Controlling
Chapter 8
Very Short Answer Type
1. State the meaning of controlling.
Ans: Controlling is the process of ensuring that what is planned actually happens. It involves measuring performance, comparing it to goals, and taking corrective action if needed.
2. Name the principle that a manager should consider while dealing with deviations effectively. State any one situationin which an organisation’s control system loses its effectiveness.
Ans: 1. Principle for effective deviation management: Management by Exception (MBE)
This principle suggests focusing on significant deviations from set goals or standards, allowing managers to prioritize their attention and avoid being overwhelmed by minor variations.
2. Situation where control system loses effectiveness: Lack of clearly defined standards or goals
Without clear benchmarks, it becomes difficult to assess deviations and understand which variances are significant enough to require attention. The control system becomes ineffective as it's unclear what exactly needs to be controlled.
3. State any one situation in which an organisation’s control system loses is effectiveness.klately it has been experiencing problems because its targets have not been met with regard to sales and customer satisfaction. Also mobile market in India has grown tremendously and new players have come with better technology and pricing. This is causing problems for the company. It is planning to revamp its controlling system and take other steps necessary to rectify the problems it is facing.
a. Identify the benefits the company will derive from a good control system.
Ans: Company Facing Challenges: Revamping Control System
Based on the provided information, the company is facing challenges due to missed sales and customer satisfaction targets, likely triggered by a growing mobile market with better technology and pricing from new players. Let's delve into this further:
Benefits of a Good Control System:
*Early Warning of Deviation: Identify issues like missed targets or changing market dynamics before they significantly impact the business.
*Improved Performance: Continuously monitor progress and take corrective actions to ensure plans are on track and goals are met.
*Enhanced Efficiency: Allocate resources effectively by monitoring resource usage and identifying areas for optimization.
*Increased Accountability: Foster responsible action by establishing clear performance expectations and tracking individual and team contributions.
*Boosted Confidence: Provide reliable data and insights to make informed decisions and increase organizational confidence in achieving goals.
b. How can the company relate its planning with control in this line of business to ensure that its plans are actually implemented and targets attained.
Ans: Relating Planning & Control:
*Align Control Measures with Key Performance Indicators (KPIs): Define measurable KPIs for sales, customer satisfaction, and market share, linked to overall strategic goals.
*Regular Monitoring & Performance Reviews: Analyze sales data, customer feedback, and market trends frequently to track progress towards KPIs.
*Implement Feedback Loops: Use control data to inform future planning, adjust strategies based on deviations, and ensure continuous improvement.
*Employee Engagement: Involve employees in setting targets, monitoring progress, and implementing corrective actions for greater ownership and motivation.
c. Give the steps in the control process that the company should follow to remove the problems it is facing
Ans: Control Process Steps for Revamp:
*Set Clear Goals & Objectives: Define specific, measurable, achievable, relevant, and time-bound (SMART) goals for sales, customer satisfaction, and market share.
*Establish Standards & Performance Parameters: Determine acceptable performance levels for each KPI based on past data, industry benchmarks, and strategic objectives.
*Choose Control Techniques: Implement appropriate control techniques like budget analysis, customer surveys, market research, and production line monitoring.
*Gather & Analyze Data: Regularly collect data through various channels and analyze it against established standards to identify deviations.
*Take Corrective Action: When deviations occur, investigate the root cause and implement corrective actions to address the issue and get back on track.
*Communicate & Adapt: Effectively communicate control data and adjustments to all levels of the organization, encouraging adaptation and continuous improvement.
6. Mr Shantanu is a chief manager of a reputed company thatmanufactures garments. He called the production managerand instructed him to keep a constant and continuouscheck on all the activities related to his department so thateverything goes as per the set plan. He also suggested himto keep a track of the performance of all the employees in the organisation so that targets are achieved effectively and efficiently.
a. Describe any two features of Controlling highlighted in the above situation.(Goal Oriented, continuous and pervasive – any 2).
Ans: Mr. Shantanu's instructions highlight two key features of Controlling:
1. Goal Oriented: Mr. Shantanu emphasizes the need for the production manager to ensure all activities align with the set plan. This means controlling is not just about monitoring, but also about steering activities towards achieving established goals, like production targets and deadlines.
2. Continuous and Pervasive: Mr. Shantanu calls for constant and ongoing monitoring of activities and employee performance. This emphasizes the continuous nature of controlling, where deviations from plans are identified and addressed as they occur, not just at the end of a process. Additionally, the focus on all activities and all employees underlines the pervasiveness of controlling, which applies to every aspect of the organization's operations.
b. Explain any four points of importance of Controlling.
Ans: Four points of importance of Controlling:
1. Improved Performance: By identifying and addressing deviations from plans, controlling helps ensure that the organization operates efficiently and effectively, leading to better overall performance in terms of quality, productivity, and cost control.
2. Early Warning System: Controlling acts as an early warning system, detecting potential problems before they escalate and cause significant damage. This allows for timely corrective action and prevents losses or missed opportunities.
3. Enhanced Decision Making: Reliable data and insights from control systems provide valuable information for informed decision-making at all levels of the organization. This leads to better strategic planning, resource allocation, and risk management.
4. Motivation and Accountability: Effective control systems foster a culture of accountability and responsibility within the organization. By tracking individual and team performance, employees are motivated to achieve their goals and contribute to the overall success of the company.
Questions And Answer Type By: Himashree Bora.
Post ID: DABP006905
