Differences between control and controlling

From CEOpedia | Management online

Differences between control and controlling are huge, but most people identify these two concepts with each other. The reason for this is the fact that the concept of controlling, in the first years of its existence, was only understood in sense of control. It is necessary to remember, that the concept of controlling is broader than control. Moreover, the control is one of the components of controlling and is oriented on the past (controlling is future-oriented)[1].

Reasons of confusing these two concepts

It is possible to point out two basic reasons of identification the controlling with control[2]:

  1. The definition and the role of controlling in organizations have been changing for years. At the beginning of existence, the controlling was identified with a function of control. Those days, the controlling cells dealt only with past data, which helped to control the reality and current financial situation of the companies. However, with the development of enterprises, the concept of controlling was developing too. Today, controlling has lots of other significant functions, except the control. Unfortunately, people still identify this concept with its first function.
  2. The second reason for confusing control with controlling is usually associating these two words by people. Because of the fact, the word "controlling" is derived from "control", it may seem that they are meaning the same.

Main differences

In order to properly understand the definition of control and controlling, basic differences between these concepts should be indicated[3][4]:

Control (Oriented on the past) Controlling (Future-oriented)
  • it finds errors in past activities and decisions,
  • proposes fixes,
  • looks for the guilty in staff, unreasonable activities, bad decisions,
  • proposes changes in personnel,
  • proposes organizational changes,
  • it is oriented to goals,
  • it refers to process,
  • it relates to a lack of goal congruence,
  • it must be able to motivate people to take actions and make decisions,
  • it must provide information about the results of operations and people's performance,
  • it coordinates processes,
  • it monitors deviations from the plan and forecast,
  • it advises how to solve current problems,
  • it proposes solutions, which will improve the situation of the organization in the future,
  • it proposes measures of the enterprise's developing,
  • inspires to action
  • it uses tools, which help to avoid the business risks in the future,

Examples of Differences between control and controlling

  • Control is focused on monitoring and measuring the performance, while controlling is focused on motivating and guiding the team. For example, a supervisor can use control to measure how much time it takes his team to complete a task and compare it to the expected time. On the other hand, the supervisor can use controlling to provide feedback and guidance on how to improve the performance of the team in the future.
  • Control is oriented on the past, while controlling is oriented on the future. For example, a manager can use control to identify problems that have arisen in the past and take corrective action. On the other hand, the manager can use controlling to create strategies and plans to improve the performance of the organization in the future.
  • Control involves making sure that the rules and regulations are being followed, while controlling involves making sure that the goals of the organization are being achieved. For example, a business owner can use control to ensure that their employees are following the company’s policies. On the other hand, the business owner can use controlling to make sure that their business is achieving its goals, such as increasing its profits.
  • Control is focused on finding and correcting errors, while controlling is focused on prevention. For example, a quality control manager can use control to inspect products for defects and take corrective action if any are found. On the other hand, the manager can use controlling to improve the processes used to create the products in order to reduce the number of defects.

Advantages of Differences between control and controlling

One of the main advantages of the differences between control and controlling is that it allows organizations to make more informed decisions. The following are some of the other benefits:

  • Control is more focused on the past performance of the organization, allowing it to identify any problems that may have occurred, and to make changes to the processes or systems to prevent them from occurring in the future.
  • Controlling is more forward-looking, allowing organizations to anticipate potential problems and create plans for addressing them before they happen.
  • Control helps organizations to quickly detect errors or discrepancies, whereas controlling allows them to take proactive steps to prevent problems from occurring.
  • Control helps organizations to quickly adjust to changes in their environment, whereas controlling allows them to anticipate and prepare for future changes in advance.
  • Control helps to ensure that the organization is operating in an efficient and effective manner, while controlling helps to ensure that the organization is achieving its strategic goals.

Limitations of Differences between control and controlling

  • Control is focused on monitoring the past, while controlling is future-oriented, looking at future trends and analyzing data to make decisions.
  • Control is a tool of the controlling system, but it is not the only element of it. Controlling includes planning, analysis, monitoring, evaluation and decision-making.
  • Control is used to ensure compliance with the established standards, while controlling is focused on making decisions that will bring maximum efficiency.
  • Control is a method of ensuring consistent quality, but controlling is a process of improving overall performance.
  • Control is based solely on past data while controlling involves forecasting and strategic planning.
  • Control is used to ensure compliance with the rules, while controlling is a tool for managing the organization's resources.
  • Control is a reactive process, while controlling is proactive and looks for ways to improve efficiency.

Other approaches related to Differences between control and controlling

One of the main differences between control and controlling is the temporal orientation - control is oriented towards the past and controlling towards the future. Below are some other approaches related to the differences between control and controlling:

  • Control is a process of ensuring that standards, procedures, and policies are being followed. It is more focused on compliance and it is based on the past. Controlling, on the other hand, is a process of measuring performance in order to identify areas of improvement and set priorities. It enables the organization to reach its objectives in the most cost-efficient way.
  • Control is used to evaluate the success or failure of a certain action and it is focused on the results. Controlling, in comparison, is used to identify problems, analyze them, and suggest solutions and corrective measures.
  • Control is a corrective mechanism that focuses on ensuring the results are in line with the set standards. On the other hand, controlling is an anticipatory mechanism that focuses on the efficiency of processes and procedures, as well as on the potential risks.

In summary, control and controlling have different objectives, scopes and orientations. Control is focused on ensuring that standards, procedures, and policies are being followed, while controlling is focused on measuring performance, identifying areas of improvement, setting priorities, and finding solutions to problems.


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References

Footnotes

  1. Horváth & Partner (2019), p.6
  2. Reichmann T. (2012), p.3
  3. Flamholtz E.G. (2012), p.2
  4. Laval H. (2018), p.27

Author: Milena Kurczek