team reflection

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Page 1© University of Phoenix 2014 Controls Podcast

ID: 02-AUDIO-538cbd45d04694245225a528 Controls Podcast

RECORDED ON

Jun 02, 2014

SPEAKER

Scott, Diane, Timothy Pittman

Scott: Hey everyone, welcome to the podcast where we talk in detail about management and business principles that YOU need for success.

Diane: Today we're talking about the control process – what it is and why it's important. First off, what is controlling?

Scott: I'd say “my mother-in-law,” but I don't think that's quite the answer you're looking for!

(laughs)

Diane: Not quite, no! Controlling is about keeping track of and fixing work performance, and it is a key weapon in every manager's arsenal. Without proper controls in place, determining issues and understanding how to go about fixing them will be difficult indeed.

Scott: Now, when you say “controls,” do you mean that a manager needs to be involved in every single aspect of their employees’ day?

Diane: It doesn't have to be as invasive as it sounds. It just means having routine standards in place to check work quality, worker knowledge, and performance standards. It's crucial to have controls in place because, let's face it, even the best laid plans can be foiled through human error.

Scott: And that's not even to say anything malicious. Just the fact that we're imperfect means that having controls in place can catch those things that, through no fault of someone's own, might fall through the cracks.

Diane: Exactly. Imagine an ATM that has faulty software. It gives out $100.00 for every $20.00 someone tries to withdraw. It is very possible that it would take a long time for patrons to alert the bank to the problem, and in the meantime the bank could be losing thousands of dollars. To top it off, customers might face the headache of having to return money they've already spent. All of this could be avoided with certain controls in place to make sure that the money being dispensed is accurate to the letter.

Scott: Wow! Well, with so much on the line then, obviously the process of putting controls in place is crucial. How exactly does a manager go about creating controls?

Diane: Great question, and there actually is a control process. It has three steps and it represents the best way to put controls in place. You start by measuring the performance,

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then you compare it to a standard, and then you take action to attend to anything that needs addressing.

Scott: Well, that makes sense. Observe a performance, compare it to a set of optimal performance standards, and if or when you determine any don't line up, management steps in to take whatever action is necessary to bring everything up to speed.

Diane: And although it might sound simple, there are a lot of things that go into making this process work. Take measuring, for example. This is the most important part of the process because if you measure an item incorrectly, or measure the wrong process entirely, then the rest of the process will be flawed and the results you get will be next to useless.

Scott: So, measuring is important, and I'd also assume that it's a pretty varied set of metrics – observations, oral and written reports, statistics, etc.

Diane: Precisely. And the more hard data backed up with numbers you can get, the better. However, not all important metrics are going to be easily quantifiable, and that's where more of the subjective, personal observations will come in handy.

Scott: So, after you have measured the performance, now you compare it against some set standard, correct?

Diane: Right you are, Scott! The important part here, of course, is to not jump the gun. Like anything performance based, you have to be aware of deviation. What we are looking for isn't the standard deviation. We are hoping to find big swings outside of the normal deviation, because those are the actual problems that need addressing.

Scott: Which makes perfect sense. So, now that we have looked at the performance and compared it to the standard, we can do one of three things: correct the performance, correct the standards, or do nothing at all, right?

Diane: Yes, that's exactly it. If there is a problem and it is noticeable, then things need to change so that the actions taken are the desired actions. It's possible, however, that the performance was much better or much worse than the standard, and that might mean the standard itself is to blame. Think about a typical sales job. If the quota is to sell four widgets, and everybody is selling 50 widgets, it is more than likely that the standard is far too low.

To delve more into the specifics, however, let’s talk to Timothy Pittman, who works for Honeywell IT in Continual Service Improvement. Tim, give us an example of how these processes play out Honeywell.

Tim: Well, Honeywell has what they call the “Honeywell Operating System.” It’s based on management operating systems used around the world. It developed out of the Deming process of plan- do- check-act and it has to do with say, “What are we supposed to be doing?” “Are we doing what we’re supposed to be doing?” And if not, “What do we do to get back on track?” Basically what we’re talking about here is that Honeywell has put in place what we call “critical success factors;” what does it take to be successful in any given operation. And then what we have to do is take and say, “In order to achieve those critical

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success factors, what key performance indicators are going to tell us that we’re on track to be successful?” Then the next thing is, once you have key performance indicators, is to make sure that you’re measuring those, and you’re looking at those, and you’re checking those on a daily basis, if possible. Because if you are on a daily base and you say, “Look here is where you are,” we can talk about what is happening, what’s successful and we can get feedback from the frontline people who actually work the process and can provide feedback to management. Management then can take action to improve whatever is creating a barrier to success and that completes the loop that’s required for management and labor to successfully work together to make sure that we’re moving forward and we’re keeping on track.

Scott: Thank you for that insight and all your time today, Tim. We really appreciate it!

Tim: Thank you!

Scott: And thank you all for sticking around with us. Tune in again when we talk about feed forward, concurrent and feedback controls. Until next time!

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