Exam 11: Foundations of Control

________ ratios assess how efficiently and effectively the firm is using its assets to generate profits.

Refer to the Scenario below to answer the questions that follow. Control Systems at Statco (Scenario) Statco is a statistical software company based in British Columbia.This publicly traded firm has grown dramatically over its 25-year history,and it now has more than 12 000 employees worldwide.As it has grown,the company has adopted a hierarchical structure,which emphasizes organizational authority.Management relies heavily on administrative rules,regulations,and policies in order to meet its goals.However,the company has struggled to meet projected revenues for each of the past 10 quarters.While it is true that world financial markets have been very turbulent over the past three years,demand for the firm's products has typically been recession-proof in the past.Now,the board of directors is growing increasingly impatient with the management team.The firm's president,Susan Wong,is concerned that recent performance may indicate that management has lost control of the work force.She has hired Mark Adams,an expert in control system design,to evaluate Statco and offer suggestions to improve the firm's performance. -Statco's traditional approach to control system design could best be described as ________ control.

A manufacturer of pesticides developed a training video to show customers how to handle the potentially dangerous products.They hoped this form of ________ control would reduce the risk of injury associated with their products.

"Putting out fires" is an example of basic corrective action.

Refer to the Scenario below to answer the questions that follow. Control Systems at Statco (Scenario) Statco is a statistical software company based in British Columbia.This publicly traded firm has grown dramatically over its 25-year history,and it now has more than 12,000 employees worldwide.As it has grown,the company has adopted a hierarchical structure,which emphasizes organizational authority.Management relies heavily on administrative rules,regulations,and policies in order to meet its goals.However,the company has struggled to meet projected revenues for each of the past 10 quarters.While it is true that world financial markets have been very turbulent over the past three years,demand for the firm's products has typically been recession-proof in the past.Now,the board of directors is growing increasingly impatient with the management team.The firm's president,Susan Wong,is concerned that recent performance may indicate that management has lost control of the work force.She has hired Mark Adams,an expert in control system design,to evaluate Statco and offer suggestions to improve the firm's performance. -Susan asks how management will know whether the new control system is working.Mark tells Susan that the ultimate effectiveness of a control system is determined by ________.

Productivity refers to the overall output of goods or services produced divided by the inputs needed to generate that output.

Refer to the Scenario below to answer the questions that follow. Information Controls (Scenario) Computing Solutions,Inc.,is a high-tech consulting firm that focuses on helping companies to implement and adapt new technological developments in daily operations.Ted is the department head and needs to train John and Kelly,both project managers,on the proper applications of technological solutions for businesses. -During the training session,John is overwhelmed by the quantity of raw,unanalyzed facts that are being presented to him.These numbers and names are typically called ________.

________ control is an approach that emphasizes authority and relies heavily on administrative rules,policies,and procedures.

When data are analyzed and processed,they become ________.

Keeping a public list of items that were stolen is an example of feedforward control.

Refer to the Scenario below to answer the questions that follow. Types of Control (Scenario) Sam has not been receiving the information that he needs from his current control system.By the time Sam receives his reports,the activity has been completed and mistakes have already been made.Direct supervision is used extensively on the production floor now,so some activities are corrected before they become costly mistakes.But Sam would like to do better.Ideally,he would like to fix mistakes before they happen and anticipate more of the problems before they occur. -Direct supervision is the best-known form of ________ control.

At its most fundamental level,________ means learning from others.

Nokia supplies a wide range of products throughout the world.The various divisions are evaluated according to the profits each generates.This is an example of market control.

In the ________ approach to control,employee behaviours are regulated by shared values,norms,traditions,rituals,and other aspects of the organization's culture.

The balanced scorecard approach to performance measurement was introduced as a way to evaluate organizational performance from more than just the financial perspective.

Define control within an organization.List and describe characteristics of the three approaches to designing control systems that have been identified.What determines the effectiveness of a control system?

Michelle's restaurant gives customers a questionnaire to rate the quality of their dining experience.The restaurant is using ________ control.

________ ratios examine the organization's use of debt to finance its assets,and considers whether it's able to meet the interest payments on its debt.

Judy's job requires her to handle unexpected problems that always seem to require a quick decision.She seems to spend most of her day "putting out fires" by taking ________ corrective action.

________ control is an approach that emphasizes the use of external market mechanisms such as price competition and market share to establish the standards used in the control system.