Page 4 - Lesson Note 2

It is necessary to identify the exactcause(s) of deviations, failing which; an appropriate corrective
action might not be possible. The deviations and their causes are then reported and corrective
action taken at appropriate level.
Step 5: Taking Corrective Action:

The final step in the controllingprocess is taking corrective action.No corrective action is
required when the deviations are within acceptable limits. However, when the deviations go
beyond the acceptable range, especially in the important areas, it demands immediate managerial
attention so that deviations do not occur again and standards are accomplished.

Corrective action might involve training of employees if the production target could not be met.
Similarly, if an important project is running behind schedule, corrective action might involve
assigning of additional workers and equipment to the project and permission for overtime work.
In case the deviation cannot be corrected through managerial action, the standards may have to
be revised. The table below cites some of the causes of deviations and the respective corrective
action that might be taken by a manager.

Some examples of Corrective Action