Closing the Loop
Controlling makes planning honest: measure results, compare against the plan, correct the gap. Without it, planning is fiction.
The control cycle has four beats:
| Beat | Action | Failure mode |
|---|---|---|
| Set standards | Derive targets from the plan | Vanity metrics |
| Measure | Gather actuals at frequency | Late data |
| Compare | Compute variances, filter noise | Chasing wiggles |
| Correct | Fix process or standard | Blaming people |
Management by exception says investigate variances beyond threshold. Common pitfall: Investigating only unfavorable variances. A cost 20% under budget can mean skipped maintenance; exception cuts both ways.
Timings and Scorecards
Three timings control operations:
| Timing | When | Example |
|---|---|---|
| Feedforward | Before work | Input inspection |
| Concurrent | During | Live dashboards |
| Feedback | After | Monthly closes |
Feedback is cheapest to build but arrives after errors ship.
Goodhart's law warns that when a measure becomes a target, it stops measuring.
The balanced scorecard tracks four perspectives: financial, customer, internal process, and learning & growth. They form a causal chain where leading indicators warn before money moves.
Control paradox: too little causes drift; too much strangles work.