Chapter 07 – Management and Leadership
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148.
Chapter 07 – Management and Leadership
Accounting and finance are important for control systems because they provide the
numbers management needs to evaluate progress.
149. External customers are those individuals or units that receive services from other units
within the same organization.
150. A customer-oriented firm should focus exclusively on satisfying its internal
customers.
151. When all is said and done, financial standards such as profit and return on investment
are the only relevant measures of how well a firm is meeting its goals.
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152. When setting standards used in controlling, it is better to simply state general goals
such as “better quality” or “higher levels of consumer satisfaction” than it is to spend a lot
of time and effort developing more specific standards.
Feedback: If standards are stated in very general terms, it becomes difficult to determine
whether the goals are being met. General and vague goals do not clearly identify what the
firm is trying to achieve.
153. Chase is a manager for World Graphic Design, Inc., a firm that designs and
manufactures greeting cards, invitations, announcements, and other event material. Chase
spends a lot of time trying to find the right people for various positions at his company.
These efforts are part of the controlling function of management.
Feedback: Controlling is concerned with checking to see whether the organization is meeting
its goals by setting standards, measuring actual performance, comparing actual results with
the desired standards, providing feedback, and taking corrective action if necessary. Staffing,
which is the process of finding the right people for various positions within an organization, is
part of the organizing function of management.
154.
Chapter 07 – Management and Leadership
Rebecca is concerned about the number of customers complaining about the poor service
provided by the department she manages for a hardware store. She is convinced that her
employees can provide better service and cut complaints significantly. Rebecca has set a
goal for her department to reduce customer complaints by 15% within six months. This
goal is an example of the type of performance standard needed for effective controlling.
Feedback: An effective standard for the controlling process should be specific, attainable, and
measurable. It is also important to establish a time period for the achievement of the goal.
Assuming that she is correct about the ability to reduce complaints significantly, Rebecca’s
standard satisfies these criteria.
155. Pro Fit, Inc., a maker of men’s sportswear, has just reported a record profit. This
proves that the firm is successfully achieving its goals.
Feedback: Although measures of financial success (such as profit) are very important
indicators of business performance, they are not the only measures. The purpose of a firm
today is to satisfy a broad group of stakeholders, including employees, customers, and the
people living in the local communities where the business has operations. The success of the
firm at satisfying the diverse interests of these groups cannot be measured by focusing on
financial criteria alone.
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156. Management is more progressive today. There is more emphasis on:
A. individual work that can be successfully measured.
B. working in teams.
C. striving to eliminate the control function of management.
D. placing greater reliance on the government for financing.
157. One of the challenges facing today’s managers is to:
A. deal with a workforce that is less educated and less self-directed than in the past.
B. find ways to encourage conformity instead of diversity.
C. work with a more educated workforce.
D. cope with the sudden and unexpected slowdown in the pace of innovation and change.
158. Today’s progressive managers:
A. prefer to use the autocratic style of leadership.
B. emphasize teamwork and cooperation rather than discipline and order-giving.
C. face fewer challenges and problems than managers in the past.
D. can rely on a much higher level of worker loyalty to the organization than in the past.
