CBSE Class 12 Case Studies In Business Studies – Controlling

CONTROLLING
Controlling: Definition
Controlling means ensuring that activities in an organisation are performed as per the plans.

Importance of Controlling

  • It helps in accomplishing organisational goals by constantly monitoring the performance of the employees and bringing to light the deviations, if any, and taking appropriate corrective action.
  • It helps the business managers to judge the objectivity and accuracy of the standards.
  • It seeks to make efficient use of resources.
  • It seeks to motivate the employees and helps them in giving a better performance.
  • It creates an atmosphere of order and discipline in the organisation.
  • It facilitates coordination in action by providing direction to all activities within and among departments.

Features of Controlling

  • It is a goal-oriented function.
  • It is a pervasive function as it is used in the organisations of varying types and sizes.
  • It is considered to be a forward looking function as it helps to improve the planning by providing valuable feedback for reviewing and revising the standards.
  • It is considered to be a backward looking function as it is like the post mortem of the past activities to ascertain the deviations if any.
  • It is not the last function of management as it brings the management cycle back to the planning function.

Steps Involved in the Controlling Process

  • Setting performance standards in clear, specific and measurable terms.
  • Measurement of actual performance as far as possible in the same units in which standards are set.
  • Comparing actual performance with standards to identify deviations if any.
  • Analysing deviations through critical point control and management by exception approaches to identify the causes for their occurrence.
  • Taking corrective action whenever the deviation occurs beyond the permissible limits so that it does not reoccur in future.

Relationship between Planning and Controlling

  • Planning without controlling is useless and controlling without planning is blind.
  • Planning provides the basis of controlling by setting the standards in advance. In the absence of these standards, managers will not know what all activities have to be controlled.
  • Planning is prescriptive in nature whereas, controlling is evaluative.
  • Thus, planning and controlling are interrelated and interdependent. As planning is based on facts, it makes controlling easier and effective whereas controlling helps to improve future planning by providing valuable information derived from the past experiences.

MIND MAP
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LATEST CBSE QUESTIONS

Question 1.
Hina Sweets is a renowned name for quality sweets since 1935. Harsh the owner of Hina Sweets was worried as the sales had declined during the last three months. When he enquired from the Sales Manager, the Sales Manager reported that there were some complaints about the quality of sweets. Therefore Harsh ordered for sample checking of sweets.
Identify the step taken by Harsh that is related to one of the functions of management.
(CBSE, Delhi 2017)
Answer:
Measurement of actual performance is the step in controlling process being described.

Question 2.
State the steps in the process of controlling. (CBSE, Delhi 2017)
Answer:
The various steps involved in the controlling process are described below:

  1. Setting performance standards: The first step in the controlling process involves setting standards in clear, specific and measurable terms. Standards can be set in both quantitative as well as qualitative terms. It is important that standards should be flexible enough to be modified with the changes taking place in the internal and external business environment.
  2. Measurement of actual performance: The next step relates to the measurement of actual performance. Performance should be measured in an objective and reliable manner. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier. Depending upon the nature of work various techniques for measurement of performance like personal observation, sample checking, performance reports, etc. may be used.
  3. Comparison of actual performance with standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation and noting deviations if any. If the actual performance is more than planned performance deviations are said to be positive or vice-versa.
  4. Analysing deviations: Once the deviations are identified it is important to analyse them through:
    • Critical point control: All the deviations may not be significant. Moreover, it may not be either economical nor easy to monitor each and every activity in the organisation. Therefore, every organisation identifies and states its specific key result areas (KRAs) or critical points which require tight control are likely to have a significant effect on the working of the business. Any deviations on these points are attended to urgently by the management. Like if the expenditure on refreshment of workers goes up by 10% it can be ignored but if the production cost goes up by 5% it may call for managerial action.
    • Management by exception: Management by exception is the principle of management control which is based on the belief that if you try to control everything, you may end up controlling nothing. Therefore, only significant deviations which go beyond the permissible limits should be brought to the notice of the management. Like the output defects upto 2% may be considered acceptable but if goes up by 5% it may call for managerial action.
  5. Taking corrective action: This is the final step involved in the controlling process. When the deviations are within acceptable limits no corrective action is required. However, when the deviations go beyond the acceptable range, especially in the important areas, it demands immediate managerial attention so that deviations do not occur again and standards are accomplished. Corrective action might involve training of employees, buying new machinery, increasing supervision and so on.

Question 3.
Describe briefly the relationship between controlling and planning. (CBSE, Delhi 2017)
Answer:
The relationship between controlling and planning is described below:
Planning and controlling are inseparable twins of management. Planning provides the basis for controlling. The desired standards are set in the process of planning in clear, specific and terms. In the process of controlling the actual performance is measured and compared with these standards and the deviations if any are identified and appropriate corrective action is taken. However, in the absence of any standards it would not be possible to gauge the actual performance. Thus, planning without controlling is meaningless and controlling without planning is blind.
Planning is prescriptive where as controlling is evaluative. Planning is an intellectual activity which is concerned with thinking, articulating and analyzing various alternative course of actions and prescribing the best possible alternative in order to achieve the desired goals efficiently and effectively. Controlling on the other hand is concerned with ensuring that events conform to plans. Thus, it involves monitoring and measuring the extent to which the desired goals have been realized.
Planning is looking ahead and controlling is looking back. Planning is futuristic in nature as it involves chalking out the future curse of action. It bridges the gap between where we are and where we want to go. Thus, it is deemed to be a forward looking function of management. Controlling on the other hand involves postmortem of the past activities to find out deviations from the standards. Therefore, controlling is said to be a backward looking function of management. However, on closer introspection we realize that the feedback provided through the process of planning in terms of revising the standards helps to improve future performances. Hence, like planning controlling is also forward looking function.
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Planning precedes controlling and controlling succeeds planning. Thus, planning and controlling are interrelated and reinforce each other because:

  • Planning is based on facts and makes controlling process easier and adds to the effectiveness.
  • Controlling also adds to the effectiveness of planning process by providing valuable feedback based on past experiences.

Question 4.
State any five points that highlight the importance of ‘controlling’ function of management.
(CBSE, Delhi 2017)
Answer:
The importance of controlling function of management is described below:

  1. Accomplishing organisational goals: The controlling function facilitates constant monitoring of the actual performance in comparison to the predetermined standards and brings to light the deviations, if any, and indicates corrective action. All these activities ensure that organisational goals are realised efficiently and effectively.
  2. Judging accuracy of standards: A good control system enables management to verify whether the standards set are accurate and objective. Moreover, helps to review and revise the standards in light of changes taking place in the organisation or business environment in general.
  3. Making efficient use of resources: By implementing a good control system a manager seeks to reduce wastage and spoilage of resources. This is because each activity is performed in accordance with predetermined standards and norms rather than hit and trial method.
  4. Improving employee motivation: An effective control system seeks to provide motivation to the employees as they are made aware well in advance what they are expected to do and what are the standards of performance on the basis of which they will be appraised. This approach helps them to give better performance.
  5. Ensuring order and discipline: A constant check on the behaviour and work of the employees leads to creation of an atmosphere of order and discipline in the organisation.

Question 5.
How does controlling help in “Judging accuracy of standards” and “Ensuring order and discipline”? (CBSE, Sample Paper, 2017)
Answer:
Controlling helps in “Judging accuracy of standards” and “Ensuring order and discipline” as explained below:

  • Judging accuracy of standards: An efficient control system enables management to determine weather the standards set are accurate and objective. This is because it helps to helps to review and revise the standards in light the changes taking place in the organisation and in the environment.
  • Ensuring order and discipline: Controlling helps to minimise dishonest behaviour on the part of the employees by keeping a close check on their activities. Thus, it creates an atmosphere of order and discipline in the organisation.

Question 6.
‘If anything goes wrong with the performance of key activities, the entire organisation suffers. Therefore, the organisation should focus on them.’ Explain the statement with a suitable example.
(CBSE, Sample Paper 2015-16)
Answer:
The given statement refers to the importance of ‘Critical Point Control’ in order to ensure effective performance of key activities in an organisation.
Critical Point Control: It may not be either economical nor easy to monitor each and every activity in the organisation. Therefore, every organisation identifies and states its specific Key Result Areas (KRAs) or critical points which require tight control and are likely to have a significant effect on the working of the business. Any deviations on these points are attended to urgently by the management. For example, if in an organisation, the expenditure on stationery goes up by 10%, it can be ignored but if the production cost goes up by 5%, it may call for managerial action.

Question 7.
Mr. Nath, a recently appointed production manager of Suntech Ltd., has decided to produce jute bags instead of plastic bags as these are banned by the government. He set a target of producing 1000 jute bags a day. It was reported that the employees were not able to achieve the target. After analysis, he found that employees were demotivated and not putting in their best for achieving the target. Mr. Nath’s behaviour is good towards the employees. His attitude is always positive. So, he announced various incentive schemes for the employees like:

  1. Installing awards or certificates for best performance
  2. Rewarding an employee for giving valuable suggestions
  3. Congratulating the employees for good performance
    • Identify the functions of management highlighted in the above paragraph.
    • State the incentive under which the employee are motivated.
    • State any two values which the production manager wants to communicate to society by his work and behaviour.
      (CBSE, Sample Paper 2015)

Answer:

  1. The functions of management highlighted in the above paragraph are Controlling and Directing.
  2. The employees are motivated under Employee recognition programmes which is a non-financial incentive. Employee recognition programmes helps to fulfill the need of due consideration and appreciation of the people working in an organisation. It boosts their self-esteem and motivates them to work with greater zeal and enthusiasm.
  3. The two values that the manager wants to communicate to the society through his work and behaviour are:
    • Respect for employees
    • Concern for environment

Question 8.
A company was manufacturing LED bulbs which were in great demand. It was found that the target of producing 300 bulbs a day was not met by the employees. On analysis, it was found that the workers were not at fault. Due to electricity failure and shortage of workers, the company was not able to achieve the set targets and alternative arrangements were needed.
To meet the increased demand, the company assessed that approximately 88 additional workers were required out of which 8 would work as heads of different departments and 10 would work as subordinates under each head. The required qualifications and job specifications were also enlisted. It was also decided that necessary relaxations should be given to encourage women, people from backward and rural areas and people with special abilities to assume responsible positions in the organisations. All efforts were made to match the ability of the applicants with the nature of work.

  1. Identify the functions of management discussed above.
  2. State the two steps in the process of each function discussed in the above paragraph.
  3. List any two values which the company wants to communicate to the society.
    (CBSE, Delhi 2015)

Answer:

  1. The functions of management discussed above are Staffing and Controlling.
  2. The two steps involved in staffing function are as follows:
    • Estimating manpower requirements: The manpower requirements of an organisation are estimated through workload analysis and workforce analysis. The workload analysis helps to determine the number and type of human resource required in the organisation to meet its present and future needs. Whereas workforce analysis seeks to determine the number and type of human resource available within the organisation.
    • Recruitment: The process of recruitment involves searching for the prospective candidates and stimulating them to apply for jobs in the organisation. There are two sources of recruitment namely, internal and external.
      The two steps involved in controlling function are as follows:
    • Comparing actual performance with standards to identify deviations if any.
      “It was found that the target of producing 300 bulbs a day was not met by the employees.”
    • Analysing deviations through critical point control and management by exception approach to identify the causes for their occurrence.
      “On analysis, it was found that the workers were not at fault. Due to electricity failure and shortage of workers, the company was not able to achieve the set targets and alternative arrangements were needed.”
    • Taking corrective action, if required “To meet the increased demand, the company assessed that approximately … as subordinate under each head.”
  3. The two values that the company wants to communicate to the society are:
    • Women empowerment
    • Kindness.

Question 9.
‘AS Ltd.’ is a large company engaged in assembling of air-conditioners. Recently the company had conducted the ‘Time’ and ‘Motion’ study and concluded that on an average, a worker can assemble ten air-conditioners in a day. The target volume of the company in a day is assembling of 1,000 units of air-conditioners. The company is providing attractive allowances to reduce labour turnover and absenteeism. All the workers are happy. Even then the assembling of air-conditioners per day is 800 units only. To find out the reason, the company compared actual performance of each worker and observed through CCTV that some of the workers were busy in gossiping.

  1. Identify the function of management discussed above.
  2. State the steps in the process of the function identified which are discussed in the above paragraph. (CBSE, 2015)

Answer:

  1. The function of management discussed above is Controlling.
  2. The steps involved in the process of controlling which are discussed in the above paragraph are:
    • Setting standards of performance: “concluded that on an average, a worker can assemble ten air-conditioners in a day.” “The target volume of the company in a day is assembling of 1,000 units of air-conditioners.”
    • Measurement of actual performance: ” Even then the assembling of air-conditioners per day is 800 units only.”
    • Comparison of actual performance with the standards: The company compared actual performance of the workers with the planned performance and noted deviation of 200 units.
    • Analysing deviations: “To find out the reason, the company compared the actual performance of each worker and observed through CCTV that some of the workers were busy in gossiping.”

Question 10.
PQR Ltd. is engaged in manufacturing machine components. The target production is 200 units per day. The company had been successfully attaining this target until two months ago. Over the last two months, it has been observed that daily production varies between 150-170 units.

  1. Identify the management function to rectify the above situation.
  2. Briefly state the procedure to be followed so that the actual production may come up to the target production. (CBSE, Delhi 2010)

Answer:

  1. The controlling function of management is needed to rectify the above situation.
  2. The procedure to be followed so that the actual production may come up with the target production is as follows:
    • Providing training to workers if the workers are not well versed with the production process.
    • Improving the work environment if it is not conducive to efficient working.
    • Ensuring timely availability of the raw materials and other equipments if they are not made available on time.
    • Replacing the machinery if it is defective or has become obsolete.

Question 11.
Rajeev and Sanjeev are managers in the same organisation heading different units. While discussing about the functions of management, Rajeev says that ‘Planning is looking ahead whereas controlling is looking back.’ But Sanjeev says, ‘You are wrong because planning is looking back whereas controlling is looking ahead.’ Both are giving reasons in favour of their statements. Explain the possible reasons given by both and justify who is correct. (CBSE, 2009)
Answer:
Both Rajeev and Sanjeev are correct in their statements as explained below:

  • Planning is considered as a forward looking function by Rajeev as plans are made for future.
  • Planning may be considered as a backward looking function by Sanjeev because the quality of planning can be improved with the help of valuable information provided by controlling in terms of results achieved.
  • Controlling is considered as a backward looking function by Rajeev as it is like the post mortem of the past activities to ascertain the deviations if any.
  • Controlling is considered as a forward looking function by Sanjeev as it helps to improve the future performance by providing guidance for taking corrective action so that deviations do not reoccur in future.

Question 12.
Kapil & Co. is a large manufacturing unit. Recently the company had conducted time and motion studies and concluded that on an average, a worker could produce 300 units per day. However, it has been noticed that the average daily production per worker is in the range of 200-225 units.

  1. Name the function of management and identify the steps in the process of this function which helped in finding out that the actual production of a worker is less than the set target.
  2. To complete the process of the function identified in (1) and to ensure the performance as per time and motion studies, explain what further steps a manager has to take? (CBSE, 2010)

Answer:

  1. Controlling is the function of management which helped in finding out that the actual performance of a worker is less than the set target.
    The steps involved in the controlling function of management which helped in finding out that the actual performance of a worker is less than the set target are outlined below:
    • Setting performance standards in clear, specific and measurable terms.
      “Recently the company had conducted time and motion studies and concluded that on an average, a worker could produce 300 units per day.”
    • Measurement of actual performance as far as possible in the same units in which standards are set.
      “It has been noticed that the average daily production per worker is in the range of 200-225 units”.
    • Comparing actual performance with standards to identify deviations if any.
      In the given case there is a deviation in output in the range of 25-50 units per worker.
  2. In order to complete the process of controlling and to ensure the performance as per time and motion studies the manager has to further take the following two steps:
    • Analyzing deviations through critical point control and management by exception approach: In the given situation, there is a deviation in output in the range of 25-50 units per worker. The manager should analyse the reasons for the same. The possible reasons for the same are:
      • The workers are not well versed with the production process.
      • The working environment is not conducive to efficient working.
      • The raw materials and other equipment are not available on time.
    • Taking corrective action: The deviations require immediate management attention so that they do not reoccur in future. Therefore, the manager should take appropriate corrective action after analyzing the situation like providing training to workers, improving the work environment, and ensuring timely availability of the raw materials and other equipment.

Question 13.
K&K Co. Ltd. is engaged in manufacturing of machine components. The target of production is 200 units daily. The company had been successfully attaining this target until two months ago. Over the last two months it has been observed that daily production varies between 150-170 units. Identify the possible causes for the decline in production and the steps to be taken to achieve the desire targets. (CBSE, 2008)
Answer:
The possible causes for decline in production are listed below:

  • The workers are not well versed with the production process.
  • The working environment is not conducive to efficient working.
  • The raw materials and other equipment are not available on time.
  • The machinery is defective or has become obsolete.

The deviations require immediate management attention so that- they do not reoccur in future. Therefore, the manager should take appropriate corrective action after analyzing the situation like providing training to workers, improving the work environment, ensuring timely availability of the raw materials and other equipment or replacing the machinery.

ADDITIONAL QUESTIONS

Question 1.
‘Taste Buds Ltd.’ is a company known for manufacturing good quality confectionery products. The automated system of production ensures uniformity in production and quality maintenance. The quality assurance team conducts stringent checks at all stages, records and analyses the deviations and takes the necessary corrective actions right from the procurement of raw material to its processing, production and packaging. The company has a well-equipped in¬house quality inspection cell where confectionery products are tested on various parameters of quality by the team of experienced quality staff.
In context of the above case:

  1. Identify and explain the function of management being performed by the quality assurance team of ‘Taste Buds Ltd.’
  2. Explain the statement, “records and analyses the deviations and takes the necessary corrective actions”.

Answer:

  1. Controlling is the function of management being performed by the quality assurance team of ‘Taste Buds Ltd.’
    Controlling is the process of ensuring that events conform to plans.
  2. The statement “records and analyses the deviations and takes the necessary corrective actions” refers to the following steps involved in the process of controlling:
    • Comparing the actual performance with the standards: The actual performance is compared with the standards and deviations, if any, are recorded.
    • Analysing deviations: Once the deviations are identified, it is important to analyse them through:
      • Critical point control: All the deviations may not be significant. Moreover, it may not be either economical nor easy to monitor each and every activity in the organisation. Therefore, every organisation identifies and states its specific key result areas (KRAs) or critical points which require tight control as they are likely to have a significant effect on the working of the business. Any deviations on these points are attended to urgently by the management. Like in the above case, if the expenditure on refreshment of workers goes up by 10% it can be ignored but if the production cost goes up by 5% it may call for managerial action.
      • Management by exception: Management by exception is the principle of manage¬ment control which is based on the belief that if you try to control everything, you may end up controlling nothing. Therefore, only significant deviations which go beyond the permissible limits should be brought to the notice of the management. Like in the above case, the output defects upto 2% may be considered acceptable but if it goes up by 5%, it may cal for managerial action.
  3. Taking corrective action: The last step in controlling process involves taking corrective action whenever the deviation occurs beyond the permissible limits so that they do not reoccur in future. However, the standards may be revised if it is not possible to check deviations through corrective action.

Question 2.
Anubhav has set up an export house after completing his masters in fashion designing. As the quality of the garment depends on the quality of raw material used, he assures that the fabric meets the requirements by conducting a series of tests for the fabrics like shrinkage test, testing colour fastness to washing, colour fastness to light, colour fastness to perspiration etc through laboratory tests. Later on, at the production areas, fabric inspection is also conducted by stopping the production process. The tests help to detect the deviations and also take corrective action. Moreover, he ensures that complete training about production work was given to every worker at the time of joining his export house.
In context of the above case:

  1. Identify the function of management being performed by Anubhav by conducting tests to assure for the quality of the garments manufactured in his export house.
  2. Briefly explain the term ‘deviations.’
  3. Give any three advantages of giving training to the employees.

Answer:

  1. Controlling is the function of management being performed by Anubhav by conducting tests to assure for the quality of the garments manufactured in his export house.
  2. The term ‘deviations’ refers to the difference between the actual performance and planned performance. If the actual performance is more than the planned performance, it may be said to be positive in nature or vice-versa.
  3. The benefits of training and development to an organisation are as follows:
    1. Training imparts systematic learning to the employees thereby helping to avoid wastage of efforts and money and is considered better than the hit and trial method.
    2. It increases the employees’ productivity both in terms of quantity and quality, leading to higher profits.
    3. Training increases the morale of the employees and reduces absenteeism and employee turnover.

Question 3.
Raghav started a take away eating joint in a nearby market. His business was doing well. He ensured that the food was properly cooked, a standard taste was maintained, packing of food was done effectively and the orders were executed on time. But unfortunately he met with an accident and was advised three months bed rest. In his absence, his cousin Rohit took charge of his business. When he resumed his work after three months, he realised that his clientele had dropped. The people were not happy with the services as the quality of food had deteriorated and the delivery time for orders had increased considerably. All this was happening because most of his previous staff had left as Rohit used to adopt a very strict and authoritative approach towards them.
In context of the above case:

  1. List any two aspects about his business that Raghav was controlling in order to make it successful.
  2. Explain briefly any two points to highlight the importance of the controlling function.
  3. Name and explain the style of leadership adopted by Rohit.

Answer:

  1. The two aspects about his business that Raghav was controlling in order to make it successful are listed below:
    • A standard taste was maintained.
    • The orders were executed on time.
  2. The two points that highlight the importance of the controlling function are listed below:
    • Judging accuracy of standards: The controlling function helps the business managers
      to judge the objectivity and accuracy of the current standards. It also assists in reviewing and revising the standards keeping in view the forthcoming changes in both the internal and external environment of the business.
    • Improving employee motivation: The controlling function seeks to motivate the employees and helps them to give better performance. This is because it makes them aware well in advance about what they are expected to do and what the standards of performance are on the basis of which they will be judged.
  3. Rohit had adopted an autocratic style of leadership. An autocratic leader expects strict compliance from his subordinates with regard to the orders and instructions given by him. Therefore, it involves only one-way communication.

Question 4.
‘Saurashtra’ is a company involved in the export of indigenous food products like chutneys and pickles. It has tied up with the small farmers in various states for sourcing of fruits and vegetables. In this way it helps the small farmers to sell their produce at reasonable rates. The company follows a practice where only significant deviations from a budget or plan are brought to the attention of management. The degree of deviations allowed in different categories in the budget are well defined in advance, along with the appropriate levels of management who will respond to the deviations in question. For example, a deviation of Rs. 20,000 or more in purchase costs will be reported to the concerned department manager.
In context of the above case:

  1. Identify the principle of management control adopted by the company. State the belief underlying this principle.
  2. List any two values that the company wants to communicate to the society.

Answer:

  1. Management by exception is the principle of management control adopted by the company. It is based on the belief that ‘if you try to control everything, you may end up controlling nothing’.
  2. The two values that the company wants to communicate to the society are:
    • Rural development
    • Sense of responsibility

Question 5.
Shruti has established a small scale factory after completing a course in textile designing. She has tied up with the big home furnishing retail outlets in the city for supplying to them good quality designer home furnishing products like bed covers, cushions etc. She believes that controlling without planning is blind. So, every time she gets an order, she sets the standards in terms of the number of personnel required, the estimated requirements in man-hours per product, the requirements of direct materials for the projected production and the amount of normal overhead expenses required at the projected work-load. She also keeps a close watch on the activities so as to ensure that they conform to plans. Whenever the order size is too large, she hires extra workers by placing a notice on the notice-board of the factory specifying the details of the jobs available.
In context of the above case:

  1. Identify the functions of management being performed by Shruti.
  2. Do you think Shruti is right in her thinking that, “controlling without planning is blind.” Explain by bringing out the relationship between planning and controlling.
  3. Name the source of recruitment adopted by Shruti. Also, mention its type.

Answer:

  1. The functions of management being performed by Shruti are Controlling and Staffing.
  2. Yes, Shruti is right in thinking that, ” controlling without planning is blind.”
    Planning provides the basis of controlling by setting the standards in advance. In the absence of these standards, managers will not know what all activities have to be controlled. Planning is prescriptive in nature whereas controlling is evaluative. Thus, planning and controlling are interrelated and interdependent as planning is based on facts and makes controlling easier and effective whereas controlling helps to improve future planning by providing valuable information derived from the past experiences.
  3. The source of recruitment adopted by Shruti is Direct Recruitment. It is an external source of recruitment.

Question 6.
Vishesh works as an interior designer. He gets a contract to redesign a play school. He employs three painters on the site assuming that an average painter will be able to paint 10 desks in a day. At the end of the first day of their work, Vishesh finds that the painter A, painter B and painter C have painted 12, 14 and 15 desks respectively. On comparing the actual performance with the planned performance, he realises that the standard set by him is too low. Consequently, he decides to review and revise the standard and raise it.
In context of the above case:

  1. Identify the function of management being performed by Vishesh.
  2. “Planning and controlling are both backward looking as well as forward looking functions.” Explain the statement with reference to the above paragraph.

Answer:

  1. Controlling is the function of management being performed by Vishesh.
  2. It is appropriate to say that, “Planning and controlling are both backward looking as well as forward looking functions” as evident from the above case.
    Planning is considered as a forward looking function as plans are made for future.
    “assuming that an average painter will be able to paint 10 desks in a day.”
    Planning may be considered as a backward looking function because the quality of planning can be improved with the help of valuable information provided by controlling in terms of results achieved.
    “On comparing the actual performance with the planned performance, he realises that the standard set by him is too low.”
    Controlling is considered as a backward looking function as it is like the post mortem of the past activities to ascertain the deviations if any.
    “At the end of the first day of their work, Vishesh finds that the painter A, painter B and painter C have painted 12, 14 and 15 desks respectively.”
    Controlling is considered as a forward looking function as it helps to improve the future performance by providing guidance for taking corrective action so that deviations do not reoccur in future.
    “Consequently, he decides to review and revise the standard and raise it.

Question 7.
A critical point control (CPC) approach is followed by McDonald in the cooking and handling process so that any food safety threat can be prevented, eliminated, or reduced to an acceptable level. Hence, continuous monitoring of activities are undertaken to ensure that the process is right at each critical point control. The main principle followed for cooking at McDonald is “less amount many time” which can ensure the high quality and high fresh level of the food. For instance, if four hamburgers have to be made, a worker cannot cook all the four hamburgers at one time. The time figured out for making one hamburger is one hundred and forty-five seconds. Moreover, nearly all foods in the McDonald have the specific holding time, the holding time for hamburgers is ten minutes and for french fries is seven minutes. If it is not sold within that time it is thrown away. Also, the temperature of the milk sent by the supplier must be under 4° C, otherwise, it will be returned.
In context of the above case:

  1. Name the steps involved in the controlling process which is being discussed in the above lines.
  2. What do you understand by ‘critical point control’? Explain.
  3. How does the controlling function of management help in accomplishing organisational .goals and ensure efficient use of resources?

Answer:

  1. Analysing deviation and taking corrective action are being discussed in the above lines.
  2. Since it may neither be economical nor easy to monitor each and every activity in the organisation, therefore, every organisation identifies ar\d states its specific key result areas (KRAs) or critical points which require tight control are likely to have a significant effect on the working of the business. Any deviations on these points are attended to urgently by the management.
  3. The two points that highlight the importance of the controlling function are listed below:
    • Accomplishing organisational goals: The controlling function helps in accomplishing organisational goals by constantly monitoring the performance of the employees and bringing to light the deviations, if any, and taking appropriate corrective action.
    • Making efficient use of resources: The controlling function enables the managers to work as per predetermined standards. This helps to avoid any ambiguity in business operations and reduce wastage and spoilage of resources in the organisation.

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