Deck 11: Foundations of Control

Question 1

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

Answer 1

False

Question 2

The major drawback of feedback control is that by the time the manager has the information,the problem has already occurred.

Answer 2

True

Question 3

When performance is below standards,a manager's options are to do nothing or revise the standard.

Answer 3

False

Question 4

How we measure is more critical than what we measure.

Question 5

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

Question 6

The range of variation is used to compare performance against a standard.

Question 7

Management by walking around (MBWA)is a good example of feedforward control.

Question 8

Control is important because it is the second link that sets the stage for the organizing and planning functions.It's the best tool for managers to understand what motivates employees.

Question 9

Concurrent control implements controls before an activity begins.

Question 10

Setting goals is the first step of the control process.

Question 11

Bureaucratic control uses mechanisms such as price competition and market share.

Question 12

The only criterion that determines the effectiveness of a control system is how well it reduces unnecessary costs.

Question 13

Josh,a manager at Bombardier,spent the morning reading the company's most recent annual report.This document serves as a source of feedback control.

Question 14

Control is the process of monitoring activities to ensure that they are being accomplished as planned.

Question 15

Written reports provide detail coverage of activities,but are time consuming and distracting when it comes to employees.

Question 16

Benchmarking is more effective for external comparisons than for internal comparisons.

Question 17

Market control is an approach to control that emphasizes the use of external market mechanisms to establish the standards used in the control system.

Question 18

The selection of criteria to measure control is not important.

Question 19

Bureaucratic control emphasizes adherence to organizational authority and relies primarily on unwritten social norms to control employee behaviour.

Question 20

Clan control is often used by organizations in which teams are common and technology is changing rapidly.

Question 21

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

Question 22

The standards that managers use as specific performance indicators in the control process are developed in the ________ function.

A)planning
B)organizing
C)leading
D)delegating
E)controlling

Question 23

________ is the process of monitoring activities to ensure that they are being accomplished as planned and correcting any significant deviations.

A)Planning
B)Organizing
C)Delegating
D)Leading
E)Controlling

Question 24

A management information system is defined as a system used to provide management with needed information on a regular basis.

Question 25

Unionized employees have less privacy with respect to their computers than non-unionized workers.

Question 26

Which common source of information for measuring performance is obtrusive,time-consuming,and most subject to personal biases?

A)personal observation
B)statistical reports
C)financial reports
D)written reports
E)oral reports

Question 27

Economic value added is calculated by taking after-tax operating profit minus the total annual cost of capital.

Question 28

________ is the end result of an activity.

A)Productivity
B)Control
C)Execution
D)Performance

Question 29

According to the textbook,studies have shown that market value added is a predictor of economic value added.

Question 30

________ determines the acceptable parameters of variance between actual performance and the standard.

A)Clan control
B)A statistical report
C)Range of variation
D)A written report
E)Market control

Question 31

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

Question 32

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.

Question 33

Sales data from the same date exactly one year ago are an example of ________.

A)effectiveness
B)a statistical report
C)efficiency
D)benchmarking
E)market control

Question 34

In the final stage of the control process,managers can choose among three possible courses of action: do nothing,correct actual performance,or revise the standard.

Question 35

Basic corrective action corrects problems at once to get performance back on track.

Question 36

An effective control system ensures that activities are completed in ways that ________.

A)motivate employees
B)maximize profits
C)lead to the attainment of organizational goals
D)minimize conflict
E)maximize production output

Question 37

When information is analyzed and processed,it becomes data.

Question 38

________ is the final link in the four management functions.

A)Planning
B)Organizing
C)Leading
D)Delegating
E)Controlling

Question 39

Employers have the legal right to monitor employees' email,telephone conversations,and computer usage at work.

Question 40

Mary's job is to compare each department's monthly budget to its actual expenditures.Mary is performing part of the ________ function.

A)planning
B)organizing
C)delegating
D)leading
E)controlling

Question 41

Tim has been asked to investigate last month's production shortfall and correct the problem.This is the third shortfall this year,and this time Tim wants to get to the source of the problem and fix it for good.Tim will take ________ corrective action.

A)basic
B)remedial
C)concurrent
D)conditional
E)intensive

Question 42

________ 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.

A)Market
B)Environmental
C)Economic
D)Clan
E)Bureaucratic

Question 43

Control that takes place while an activity is in progress is known as ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 44

Financial statements are an example of ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 45

Canadian Credit Corp.advises telephone customers that their calls may be monitored to help improve the quality of customer service.This monitoring is a form of ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 46

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

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 47

The three different approaches to designing control systems are ________.

A)market,production,and administrative
B)economic,environmental,and autocratic
C)market,bureaucratic,and clan
D)clan,bureaucratic,and economic
E)bureaucratic,clan,and environmental

Question 48

The key to ________ control is taking managerial action before a problem occurs.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 49

________ is the search for the best practices among competitors or noncompetitors that lead to their superior performance.

A)Factoring
B)Correlating
C)Situating
D)Benchmarking
E)Performance scanning

Question 50

Management at Giant Department Stores uses video equipment to periodically monitor their employee interactions with customers.This is a form of ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 51

Direct supervision is the best known form of ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 52

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.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 53

In anticipation of the Christmas rush,the Toys-For-Everyone store hired another 10 sales clerks.This is an example of ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 54

The third and final step in the control process is ________.

A)setting standards
B)measuring actual performance
C)comparing actual performance with the standard
D)taking managerial action
E)determining the acceptable range of variation

Question 55

________ corrective action looks at how and why performance has deviated and then proceeds to correct the source of deviation.

A)Basic
B)Remedial
C)Intensive
D)Immediate
E)Conditional

Question 56

One advantage of ________ control is that it can enhance employee motivation.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 57

________ corrective action corrects problems at once to get performance back on track.

A)Basic
B)Remedial
C)Concurrent
D)Immediate
E)Conditional

Question 58

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.

A)basic
B)remedial
C)concurrent
D)conditional
E)immediate

Question 59

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

A)performance scanning
B)correlating
C)benchmarking
D)factoring
E)competing

Question 60

Control that prevents anticipated problems is ________ control.

A)feedback
B)concurrent
C)conformance
D)progressive
E)feedforward

Question 61

Organizations that have clearly specified and distinct products and services and considerable competition typically use ________ control.

A)market
B)environmental
C)economic
D)clan
E)bureaucratic

Question 62

Budgets provide managers with quantitative standards against which to measure and compare resource consumption.By pointing out deviations between standard and actual consumption,they become ________.

A)leading indicators
B)environmental concerns
C)bureaucratic measuring sticks
D)clan controls
E)control tools

Question 63

Which of the following financial control measures adds a market dimension because it measures the stock market's estimate of the value of a firm's past and expected capital investment projects?

A)economic value added
B)market value added
C)principle value added
D)real value added
E)return on investment

Question 64

Beta Corporation has turned each of its divisions into profit centres and evaluates each division by the percentage of total corporate profits that it generates.Beta uses ________ control.

A)market
B)environmental
C)bureaucratic
D)clan
E)economic

Question 65

________ ratios measure an organization's ability to meet its current debt obligations.

A)Liquidity
B)Leverage
C)Conformance
D)Activity
E)Profitability

Question 66

If the company's market value is greater than all the capital invested in it,the company has a positive ________,indicating that managers have created wealth.

A)market value added
B)principle value added
C)economic value added
D)real value added
E)return on investment

Question 67

Studies have shown that ________ is a predictor of ________.

A)principle value added; economic value added
B)economic value added; real value added
C)economic value added; market value added
D)market value added; principle value added
E)real value added; return on investment

Question 68

________ 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.

A)Liquidity
B)Leverage
C)Conformance
D)Activity
E)Profitability

Question 69

Global Tech Limited uses cross-functional teams to resolve organizational problems and to keep up with rapidly changing technology.They use ________ control.

A)market
B)environmental
C)bureaucratic
D)clan
E)matrix

Question 70

When the Canadian Curling Association (CCA)established a long-term financial reserve,which financial ratio was likely most important to the CCA?

A)liquidity
B)leverage
C)conformance
D)activity
E)profitability

Question 71

Acid test is an example of a(n)________ ratio.

A)liquidity
B)leverage
C)conformance
D)activity
E)profitability

Question 72

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

A)Market
B)Environmental
C)Economic
D)Clan
E)Bureaucratic

Question 73

________ control is often used in organizations in which teams are common and technology is changing rapidly.

A)Market
B)Environmental
C)Economic
D)Clan
E)Bureaucratic

Question 74

Inventory turnover is an example of a(n)________ ratio.

A)liquidity
B)leverage
C)conformance
D)activity
E)profitability

Question 75

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

A)Liquidity
B)Leverage
C)Conformance
D)Activity
E)Profitability

Question 76

In the mid 2000s,when the Canadian Curling Association (CCA)was facing a seven-figure deficit,which financial ratio was likely most important to the CCA?

A)current ratio
B)times interest earned
C)total asset turnover
D)return on investment
E)economic value added

Question 77

Although Husky Energy gives its managers some freedom to run their departments as they see fit,they must stay within their budgets and follow corporate guidelines.Husky uses ________ control.

A)market
B)environmental
C)bureaucratic
D)clan
E)democratic

Question 78

Which of the following financial control measures is calculated by taking after-tax operating profit minus the total annual cost of capital?

A)market value added
B)principle value added
C)economic value added
D)total asset turnover
E)times interest earned

Question 79

The business faculty complained that the college print shop was charging too much for materials.A local print shop could do the same work for about half the price.Apparently,the college print shop did NOT use ________ control.

A)market
B)environmental
C)bureaucratic
D)clan
E)democratic

Question 80

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

A)market
B)environmental
C)economic
D)clan
E)bureaucratic