Deck 10: Managerial Controls

Question 1

Managers should not consider the standards when measuring the actual performance of employees.

Answer 1

False

Question 2

Deviations that exceed the acceptable range of variation become significant and need a manager's attention.

Answer 2

True

Question 3

Some control criteria,such as employee satisfaction,can be used for any management situation.

Answer 3

True

Question 4

Most employees do their jobs well and never require disciplinary action.

Question 5

Organizational effectiveness is a measure of how appropriate organizational goals are and how well those goals are being met.

Question 6

Employers establish specific policies defining theft and fraud and discipline procedures.This is an example of a concurrent control measure to control employee theft.

Question 7

Managers tend to use more direct supervision and highly centralized decision making for control in less technologically advanced countries.

Question 8

Controlling is the process of monitoring,comparing,and correcting work performance.

Question 9

Having a control system reduces the scope of employee empowerment and autonomy.

Question 10

Feedforward control takes place while a work activity is in progress.

Question 11

Embezzlement and fraudulent filing of expenses are examples of employee theft.

Question 12

Benchmarks for a company must be created based on the previous performance of the company.

Question 13

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

Question 14

Using corporate hotlines or other mechanisms for reporting and investigating workplace violence is an example of feedback control.

Question 15

The balanced scorecard approach evaluates organizational performance from more than just the financial perspective.

Question 16

Managers should do nothing if the variance observed from the standard is acceptable.

Question 17

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

Question 18

Productivity decreases when an organization raises the prices of its products.

Question 19

Managers engage in controlling activities to protect the organization and its assets.

Question 20

Feedforward control is more popular and effective than the other forms of control.

Question 21

Managers should use subjective measures when ________.

A)work activities cannot be expressed in quantifiable terms
B)work activities are critical to the organization
C)organizational processes and activities are complex
D)immediate managerial action is required

Question 22

Job uncertainties and employee stress are factors that contribute to workplace violence.

Question 23

________ is the final step in the management process,which provides a critical link back to ________.

A)Organizing; planning
B)Planning; controlling
C)Controlling; planning
D)Leading; organizing

Question 24

Managers could choose to do nothing when ________.

A)an employee fails to attain the standard because of internal problems
B)the difference between actual performance and standard performance is low and acceptable
C)performance standards are acceptable,though the employees have not attained it
D)the variance observed from the expected performance is caused due to unrealistic standards

Question 25

________ is measured by the costs of acquiring and transforming organizational resources into outputs.

A)Input
B)Quality
C)Effectiveness
D)Efficiency

Question 26

The Sarbanes-Oxley Act also called for more disclosure and transparency of corporate financial information.

Question 27

The comparing step in the control process determines ________.

A)a company's relative position in the industry in terms of the standards used
B)a company's relative position in the industry in terms of performance variances
C)the ideal standard to be used in measuring organizational performance
D)the variation between actual performance and the standard

Question 28

________ refers to the process of monitoring,comparing,and correcting work performance.

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

Question 29

Which of the following sources usually provides filtered information which cannot be documented?

A)oral reports
B)personal observations
C)statistical reports
D)written reports

Question 30

Which of the following management responsibilities determines if organizational goals are being achieved?

A)designing the organization's structure
B)motivating employees
C)formulating business strategy
D)measuring firm performance

Question 31

________ corrects the problem at once to get performance back on track.

A)Basic corrective action
B)Immediate corrective action
C)Revision of standards
D)Revision of benchmarks

Question 32

Which of the following sources of information for measuring performance has the disadvantage of being subject to personal biases,and is time consuming and obtrusive?

A)oral reports
B)personal observations
C)statistical reports
D)written reports

Question 33

The first step in the control process is ________.

A)setting the desired standards
B)measuring actual performance
C)comparing performance against expectations
D)enforcing managerial control

Question 34

Which of the following refers to the overall output of goods or services produced divided by the inputs needed to generate that output?

A)Yield
B)Demand function
C)Effectiveness
D)Productivity

Question 35

Which of the following sources provides information which is comprehensive,formal,and easy to file and retrieve?

A)oral reports
B)personal observations
C)statistical reports
D)written reports

Question 36

A service profit chain is the service sequence from employees to customers to profit.

Question 37

The control process assumes that ________.

A)employees require clear directions from management
B)employees are under-qualified and require training
C)performance standards are already in place
D)employee monitoring costs are part and parcel of doing business

Question 38

If a manager investigates how and why performance has deviated beyond the acceptable range of variation,and then corrects the source of the deviation,she is using ________.

A)bureaucratic control
B)immediate corrective action
C)basic corrective action
D)concurrent control

Question 39

Which of the following observations best explains why the control function is important?

A)An effective control system facilitates employee empowerment.
B)Forming an organizational structure is a crucial control activity.
C)Human resource management is a subset of the controlling process.
D)Organizational strategies are formed during the controlling stage.

Question 40

Which of the following is one of the main advantages of using statistical reports as the source of information?

A)Statistical reports can be used to obtain firsthand knowledge.
B)Unfiltered information can be obtained using statistical reports.
C)Statistical reports are effective for showing relationships.
D)Statistical reports allow verbal and non-verbal feedback.

Question 41

When data is analyzed and processed,it becomes ________.

A)a system
B)information
C)fact
D)a structure

Question 42

Organizational ________ is a measure of how appropriate organizational goals are and how well an organization is achieving those goals.

A)productivity
B)effectiveness
C)efficiency
D)yield

Question 43

Which of the following ratios examines the organization's use of debt to finance its assets and its ability to meet the interest payments on the debt?

A)liquidity ratios
B)leverage ratios
C)profitability
D)activity ratios

Question 44

The earthquake/tsunami which hit Japan in March of 2011 highlights the contemporary need to design organizational controls for ________.

A)cross-cultural differences
B)global turmoil and disasters
C)workplace privacy
D)workplace safety

Question 45

Raw,unanalyzed facts are called ________.

A)data
B)information
C)database
D)data center

Question 46

Which of the following is considered the easiest way to increase organizational productivity?

A)increasing the price of outputs
B)increasing the amount of inputs
C)hiring more employees
D)decreasing the value of the products

Question 47

The management control that takes place while a work activity is in progress is known as ________.

A)feedforward control
B)concurrent control
C)feedback control
D)reactive control

Question 48

An organization hires additional personnel as soon as they get a major contract.The organization is using ________ control.

A)feedforward
B)concurrent
C)feedback
D)management

Question 49

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

A)Factor analysis
B)Total quality management
C)Market positioning
D)Benchmarking

Question 50

Which of the following ratios measures how efficiently and effectively the firm is using its assets to generate revenue?

A)liquidity ratios
B)leverage ratios
C)activity ratios
D)profitability ratios

Question 51

Certain organizations conduct culture audits to find out which companies are the best to work for.What is the major benefit associated with these rankings?

A)The rankings indicate the effectiveness of an organization's concurrent control.
B)The rankings indicate how well a company performs in comparison to others.
C)These rankings are used by governments to make decisions on corporate grants.
D)These rankings affect the credit rating of concerned organizations.

Question 52

________ ratios measure how efficiently the firm is using its assets.

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

Question 53

Which of the following is a performance measurement tool that looks at four areas that contribute to a company's performance?

A)market value method
B)economic value method
C)balanced scorecard approach
D)information control approach

Question 54

________ is when a manager in the work area interacts directly with employees to maintain supervision.

A)Preventive maintenance
B)Management by walking around
C)Reactive control
D)Feedforward control

Question 55

Which of the following is considered the most desirable type of control to prevent anticipated problems?

A)feedforward control
B)concurrent control
C)feedback control
D)reactive control

Question 56

Control techniques can be quite different for different countries.The differences are primarily in the ________.

A)types of tasks that employees perform in various countries
B)way employees respond to the controlling measures
C)strategic orientation of each technique
D)measurement and corrective action steps of the control process

Question 57

In order to increase the ratio of outputs to inputs,a manager would have to ________.

A)decrease the selling price
B)increase productivity
C)increase the quality of inputs
D)hire additional employees

Question 58

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

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

Question 59

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

A)market value
B)economic value
C)balanced scorecard
D)financial control

Question 60

Management by walking around is an example of ________ control.

A)feedback
B)concurrent
C)feedforward
D)reactive

Question 61

Statco's Control (Scenario)
Statco,Inc.,is a statistical software company based in Columbia,TN.This publicly traded firm has grown in a systematic fashion over its 25-year existence and now claims 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.The firm hires Mark Adams,an expert in control system design,to design a control system and offer suggestions to improve the firm's performance.
Which of the following is a key activity that the proposed control system should perform?

A)organizational planning
B)organizational structuring
C)performance measurement
D)strategic planning

Question 62

The service profit chain is the service sequence from employees to customers to profit.According to this concept,the company's strategy and service delivery system determines ________.

A)the skill development of employees
B)how the firm performs in the short run
C)the employee satisfaction in the company
D)how employees service customers

Question 63

Experts have described employee work driven by TNC as a primary contributor to workplace violence.TNC refers to ________.

A)time,numbers,and crises
B)time,number,and chaos
C)time,neglect,and crises
D)time,neglect,and chaos

Question 64

The Sarbanes-Oxley Act called for ________.

A)increased pollution control measures from the government
B)more disclosure and transparency of corporate financial information
C)limited accountability of directors and executives of corporates
D)more social contribution from companies in the United States

Question 65

Statco's Control (Scenario)
Statco,Inc.,is a statistical software company based in Columbia,TN.This publicly traded firm has grown in a systematic fashion over its 25-year existence and now claims 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.The firm hires Mark Adams,an expert in control system design,to design a control system and offer suggestions to improve the firm's performance.
Mark recommends that the managers at Statco should identify how and why performance has deviated beyond the acceptable range of variation,and then correct the source of the deviation.Here,Mark is recommending ________.

A)bureaucratic control
B)immediate corrective action
C)basic corrective action
D)concurrent control

Question 66

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
Charles interacts directly with the employees in the work area to identify problem areas.He works with various departments to obtain a holistic idea of the business.This type of direct supervision is an example of ________ control.

A)proactive
B)concurrent
C)feedforward
D)feedback

Question 67

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
Frank believes organizational effectiveness is more important to the organization than organizational productivity.What could be the rationale behind this belief?

A)Organizational productivity is not a measure of organizational performance.
B)Organizational effectiveness is a measure of how well the organizational goals are met.
C)Organizational productivity is not directly related to organizational output.
D)Organizational effectiveness is a quantitative measure of the input-output relationship.

Question 68

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
The operations manager suggests a hike in the prices to improve productivity.However,Frank rules this option out.What could be the possible reason for this?

A)Product prices are not related to organizational productivity.
B)Selling price is negatively correlated to organizational productivity.
C)The real estate business is characterized by intense competition.
D)Such an action would lead to reduced employee satisfaction.

Question 69

Fraudulent filing of expense reports is an example of ________.

A)employee theft
B)workplace piracy
C)workplace violence
D)privacy intrusion

Question 70

Factors that have been found to be linked to workplace violence include ________.

A)too much caffeine
B)employee stress
C)poor employee diet
D)poor personal hygiene

Question 71

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
Charles wants to prevent problems before their occurrence.Which of the following is the most desirable type of control to achieve this goal?

A)reactive control
B)concurrent control
C)feedforward control
D)feedback control

Question 72

Which of the following is an example of a feedforward control measure used to control possible workplace violence?

A)Clearly communicate the security policies to employees.
B)Use corporate hotlines for reporting and investigating incidences.
C)Review company policies and change,if necessary.
D)Investigate incidences and take appropriate action.

Question 73

Clinical psychologists suggest that employee theft ________.

A)occurs primarily when there are poor management-labor relations
B)is a symptom of poor planning and management control
C)happens because people find ways to rationalize this behavior as correct
D)reflects deep cultural problems in the society

Question 74

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
Charles discovers major flaws in the packaging department.He consults the production manager and formulates control measures to improve packaging.Here,Charles is using the ________ control.

A)feedback
B)proactive
C)concurrent
D)feedforward

Question 75

An organization communicates openly to its employees about violent incidences in the workplace and what's being done to handle them.This is an example of a ________ control strategy.

A)feedback
B)proactive
C)concurrent
D)feedforward

Question 76

Statco's Control (Scenario)
Statco,Inc.,is a statistical software company based in Columbia,TN.This publicly traded firm has grown in a systematic fashion over its 25-year existence and now claims 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.The firm hires Mark Adams,an expert in control system design,to design a control system and offer suggestions to improve the firm's performance.
Mark wants to use a tool which is easy to visualize and effective for showing relationships.Which of the following tools is best suited for this?

A)personal observations
B)oral reports
C)written reports
D)statistical reports

Question 77

Statco's Control (Scenario)
Statco,Inc.,is a statistical software company based in Columbia,TN.This publicly traded firm has grown in a systematic fashion over its 25-year existence and now claims 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.The firm hires Mark Adams,an expert in control system design,to design a control system and offer suggestions to improve the firm's performance.
Mark wants to formulate a control process for the organization.What should be the first step in the control process?

A)carrying out performance comparison
B)determining the actual performance
C)developing a benchmark
D)validating the performance standard

Question 78

Corporate governance ________.

A)refers to executive governance practices in companies
B)is a system used to govern a corporation so that the interests of corporate owners are protected
C)is a term that refers to legal agreements made between two or more partner firms
D)refers to the negative influence of the corporation in society

Question 79

Two areas in which corporate governance is being reformed are the role of boards of directors and ________.

A)employee stock options
B)financial reporting
C)executive compensation
D)top level management

Question 80

The Industry Leader (Scenario)
Frank,the new CEO for First Fidelity,is working hard to turn around the formerly successful real estate business.His goal is to make First Fidelity a leader in the industry.He understands the importance of improving organizational productivity in achieving his goals.Mark is keen to improve organizational performance and effectiveness.
Ruth identifies the firm's leverage ratio to be very high.What suggestion could Ruth give to help the firm reduce its leverage ratio?

A)Increase the money supply by selling a part of its assets.
B)Pay back part of its debts to improve the ratio.
C)Maintain more current assets than current liabilities.
D)Reduce the sales to total assets ratio of the firm.