Control is a complex concept within organizations. While it may appear old-fashioned and undesirable, it is frequently employed to manage processes and people. The balance lies in its implementation: using control to ensure operations stay within acceptable risks while preserving room for autonomy, creativity, and innovation.
Historically, as organizations grow, they’ve always felt the need for control. A Harvard Business Review article from 1995, “Control in an age of empowerment,” discussed that while multiple control mechanisms exist, many organizations only apply a few and fail to establish coherence among them [1]. This is a missed opportunity. With proper implementation, organizations can maintain adequate control while fostering a conducive environment for innovation and creativity.
Diagnostic control
In bureaucratic settings, the predominant form of control is diagnostic, focusing on efficiency and effectiveness by monitoring progress against pre-established goals. This could be related to cost, market share, operational data, or project milestones. The objective is increased predictability. However, as the world becomes more uncertain and complex, this mechanism becomes less reliable.
Control through bounderies
Another control system revolves around boundaries, defined by laws or internal “codes of conduct.” These boundaries clarify what is not acceptable, aiming to guide behavior without stifling innovation. However, awareness of which boundaries to set, strategically and operationally, and how they interrelate is rarely addressed.
Two lesser-used control mechanisms include belief systems and interactive control systems.
Control by belief systems
Belief systems guide organizational patterns and behaviors, highlighting its purpose and values. Paired with boundary systems, they serve as powerful tools to exercise control, shaping the organization’s climate.
Interactive conrol
Interactive control, on the other hand, focuses on emergent information vital for the organization’s future. It uncovers data points that challenge the organization’s vision and direction. This type of control emphasizes exploration, in contrast to the retrospective nature of diagnostic control.
When combined effectively, these control mechanisms allow for both autonomy and control, serving as catalysts for innovation and creativity. A social study cited children playing more freely within a fenced playground compared to an open one, implying that boundaries, when set right, promote freedom rather than constrain it [2].
It’s essential to realize there are various “fences” we can use, and in organizational transformation, understanding these control mechanisms plays a crucial role.