Fundamentals of Business Economics and Management · Communication, Co-ordination, Collaboration, Monitoring and Control

Monitoring: Meaning and Role in Management

Updated 10 October 2026 · Fact-checked

Monitoring is the regular tracking of actual performance against plans, targets and standards. It shows early whether work is on course. It supplies information and feedback, and managers use it to decide on corrective action. To answer exam questions, link monitoring to planning, feedback and control.

Understand Monitoring: Meaning and Role in Management

Every plan sets targets: sales of ₹10,00,000 this month, a project finished in 90 days, rejects below 2%. A plan alone does not deliver results. Someone must check from time to time whether work is going as planned. That checking is monitoring.

Monitoring means observing and recording progress on a continuing basis and comparing it with the plan. It asks one question: are we on track? It does not by itself fix anything. It collects facts and reports them to the people who can act.

The main purposes of monitoring are:
- to spot deviations early, before they grow costly
- to give managers reliable, timely information
- to give employees feedback on how they are doing
- to check that resources are used as intended
- to give a base for decisions and for revising plans

Feedback is the information that flows back from monitoring to the manager or worker. Control is the step that uses this information to correct deviations and bring performance back to the plan. So monitoring feeds feedback, and feedback feeds control. Many textbooks treat monitoring as part of the controlling function. Others treat it as a continuous activity that supports control. For exams, remember: monitoring observes and reports; controlling corrects.

Common methods of monitoring are personal observation, written and oral progress reports, review meetings, budgets and variance reports, key performance indicators (KPIs), internal audit, and management information systems (MIS) or dashboards. A good system is timely, accurate, simple and focused on key results. It also reports exceptions, so managers see only major deviations.

Key formulas to remember

Deviation (variance): Deviation = Actual performance − Planned performance (standard); Monitoring finds this gap. Control decides what to do about it. A negative result is adverse only when higher output is better.
Achievement rate: Achievement % = (Actual ÷ Target) × 100; A simple KPI check. Below 100% means the target was not met.
Core sequence: Plan → Monitor → Feedback → Corrective action (control); Use this chain to link the terms in any theory question.

How to solve Monitoring: Meaning and Role in Management questions

Most questions on this topic ask for a meaning, a purpose, a method or a difference. Use this method.

1Read the stem and spot the key word: monitoring, feedback, control, deviation or review.
2Decide whether the question is about observing and reporting (monitoring) or correcting (control).
3If the option mentions comparing actual with plan on a continuing basis, it points to monitoring.
4If the option mentions taking corrective action or changing plans, it points to control.
5For method questions, match the tool: budget and variance reports for financial checks, progress reports for projects, observation for direct work, KPIs for results.
6For numbers, compute actual minus target, or actual ÷ target × 100, then interpret.
7Eliminate options with absolute words such as 'only' or 'never', which are usually wrong.
8Check that your final choice answers exactly what was asked.

Quickest way: Observe-or-correct test

When to use it: Use it for any MCQ that asks you to separate monitoring from control or feedback.

Ask: does the option only watch, measure and report? Then it is monitoring.
Ask: does it act to fix a gap or change a plan? Then it is control.
Ask: does it carry information back to the doer or manager? Then it is feedback.
For a calculation, find actual − target first, then convert to a percentage only if asked.

Common mistakes in Monitoring: Meaning and Role in Management

Treating monitoring and controlling as exactly the same thing.
Both deal with performance and books often discuss them together.
Fix: Remember that monitoring tracks and reports, while controlling corrects. Monitoring supports control.
Saying monitoring happens only at the end of a task.
Students confuse it with final evaluation or audit.
Fix: Monitoring is continuous or periodic during the work, so problems are caught early.
Thinking monitoring includes setting the standards.
Standards and monitoring appear in the same chapter.
Fix: Standards come from planning. Monitoring measures actual results against them.
Assuming monitoring means close supervision of people only.
The word suggests watching employees.
Fix: It covers money, time, quality, output and resources, not just staff behaviour.
Ignoring feedback in the answer.
Students stop at 'comparing results'.
Fix: Add that findings are reported back as feedback so that action can follow.

Worked examples

Example 1

A firm planned sales of ₹8,00,000 for a month. Actual sales were ₹7,20,000. Find the deviation and the achievement rate. Which function found the gap and which will act on it?

Show the solution

Deviation = Actual − Planned = 7,20,000 − 8,00,000 = −₹80,000.
Achievement rate = (7,20,000 ÷ 8,00,000) × 100.
7,20,000 ÷ 8,00,000 = 0.9, so the rate is 90%.
Finding the gap by comparing actual with plan is monitoring.
Acting on the gap, for example by changing the sales strategy, is control.

Answer: Deviation is −₹80,000 (adverse); achievement is 90%. Monitoring found the gap; control will correct it.

Example 2

Which statement about monitoring is correct? (A) It sets the standards of performance (B) It tracks actual performance against plans and reports deviations (C) It is done only after the project ends (D) It replaces the need for corrective action

Show the solution

Option A describes planning, because standards are set in plans.
Option C is wrong because monitoring is continuous or periodic during work.
Option D is wrong because monitoring only reports; action still follows through control.
Option B states the observing, comparing and reporting role of monitoring.

Answer: (B)

Exam tips

Learn the one-line difference: monitoring observes and reports, controlling corrects.
Memorise the chain plan, monitor, feedback, corrective action. Many MCQs test one link of it.
Match methods to uses: budgets and variance reports for money, progress reports for projects, KPIs for results.
In option sets, reject statements that say monitoring is only at the end or only about people.
Since there is no negative marking, answer every question, even after eliminating just one option.

Practice questions from Communication, Co-ordination, Collaboration, Monitoring and Control

Monitoring: Meaning and Role in Management: frequently asked questions

What is monitoring in management?

Monitoring is the continuous or regular tracking of actual performance against plans and targets. It collects and reports information so that managers know whether work is on course. It helps spot deviations early.

What is the difference between monitoring and controlling?

Monitoring observes, measures and reports performance. Controlling uses that information to correct deviations and bring results back to the plan. Monitoring supports control, but it does not by itself take corrective action.

What are the methods of monitoring performance?

Common methods are personal observation, progress reports, review meetings, budgets and variance reports, KPIs, internal audit and management information systems. The best method depends on what is being tracked, such as cost, time, quality or output.

How is monitoring linked to feedback?

Monitoring produces information about actual results. When this information is passed back to managers or employees, it becomes feedback. Feedback then guides corrective action and better planning.