Feedback control
Feedback control measures actual outcomes, compares them to plan, and uses the resulting variances to trigger corrective action; the standard variance-analysis and performance-report cycle is the classic example in management accounting.
FrameworkManagement control
See it move
Feedback control runs a five-step cycle. A standard or budget is set, actual performance is measured, the variance between the two is calculated, significant deviations are investigated, and corrective action follows. Because it responds only after results are known, it is retrospective by nature: the excess hours behind an adverse labour variance have already been worked by the time the report appears.
Check yourself
A hotel group issues monthly occupancy-rate reports to its regional managers and instructs them to investigate any property that falls more than five percentage points below its occupancy target. Which characteristic of feedback control does this arrangement most clearly illustrate?