Chapter 10 Flashcards
(26 cards)
What is the primary purpose of the controlling management process?
- Linked to PLO
- Adapt to environmental change
- Limits error
- Cope with increasing organsational size and complexity
- Minimises cost
True or False: Controlling is the final step in the management process.
True
Fill in the blanks: The controlling process involves setting ______, measuring _________ performance, evaluating __________, and taking ________ action.
- standards
- actual
- deviations
- corrective
What are the four main steps in the controlling process?
Setting performance standards, measuring actual performance, evaluating deviations and taking corrective actions
Explain the steps in control:
Establishing standards
Establish standards
- set performance standards at strategic points, derived from plans, planned target
- performance standard should be relevant, realistic, attainable and measurable
- strategy => comprehensive plans => appropriate performance standards
- profit standards, market-share standards, productivity standards, staff development standards
- standards determined through benchmarks and feedback
Explain the steps in control:
Measure actual performance
Measure actual performance
- activities must be quantifiable
- measurement should be reliable
- measurement must be carried out at strategic points
- how much information and which information and to whom
- control by exception = only NB information is reported to top management
- time between performance and measurement must be minimised
Explain the steps in control:
Evaluate deviations
Evaluate deviations
- determine performance gap
- nature and scope of deviation must be determined
- are the deviations genuine, are they large enough to justify, identify the reasons
Explain the steps in control:
Take corrective action
Take corrective action
- ensure that deviations do not occur
- improve performance
- revise strategies
- lower performance standards
Areas of control
- Key areas of control are usually physical, human, information, financial
- Physical - inventory and quality control
- Human - selection/placement of employees, control over training
- Information - market forecasting, environmental scanning, economic forecasting
What is the relationship between planning and controlling?
Controlling is based on the plans established during the planning process.
True or False: Control systems should be rigid and not allow for adjustments.
False
What is the importance of timely feedback in the controlling process?
It allows for quick adjustments to stay on track with goals.
What is the role of technology in modern control systems?
Technology enhances data collection and analysis for more effective control.
