Chapter 14—Control
TRUE/FALSE
1. Control is achieved when behavior and work procedures conform to set standards and that the
company goals are accomplished.
2. The control process begins when managers set goals.
3. Companies may determine standards by evaluating their capacity to enable goal achievement, by
listening to customers, by observing competitors, or by benchmarking other companies.
4. Benchmarking is the process of setting corporate norms.
5. Control is an intermittent activity that requires periodic attention from managers once or twice a
month.
6. Feedback control is a mechanism for gathering information about performance deficiencies before they
occur.
7. Concurrent control seeks to prevent or minimize performance deficiencies before they occur.
8. Feedforward control provides information about performance deficiencies by monitoring inputs, not
outputs.
9. Sometimes the costs of control exceed its benefits.
10. Control loss usually has no effect on goal achievement.
11. Control loss occurs when behavior and work procedures merely meet minimally acceptable standards
rather than exceeding those minimal standards.
12. Implementing controls is always worthwhile.
13. Cybernetic feasibility refers to the extent to which it is possible to implement each step in the control
process.
14. While the bureaucratic control model is designed to make companies more efficient, effective, and
fair, it frequently has the opposite effect.
15. The objective control approach to managerial control manifests itself as either behavior control or
output control.
16. In the behavioral approach to managerial control, a company’s widely shared values and beliefs guide
workers’ behavior and decisions.
17. Concertive control produces less stress for workers than bureaucratic control.
18. When self-control is used, leaders and managers provide workers with clear boundaries within which
they may guide and control their own goals and behaviors.
19. The Balanced Scorecard approach to control emphasizes measurement of organizational performance
in three equally important areas. These areas are finances, internal operations, and innovation and
learning.
20. The Balanced Scorecard method of control minimizes the chance of suboptimization.
21. Budgets are used to project costs and revenues, to prioritize and control spending, and to ensure that
expenses don’t exceed available funds and revenues.
22. The term excessive value appropriated (EVA) refers to the amount by which profits (after expenses)
exceed the cost of capital in a given year.
23. One significant advantage of economic value added (EVA) is that it clearly states what specific actions
managers should or should not take in order to improve financial performance.
24. Customer satisfaction surveys are an accurate and effective way to answer the Balanced Scorecard
question: “How do customers see us?”
25. The only dimension needed to measure quality is conformance to expectations.
26. The three levels of waste minimization are waste disposal, waste reduction, and recycling.
MULTIPLE CHOICE
1. The basic control process of business begins with ____.
a.
either benchmarking or keystoning
b.
the establishment of clear standards of performance
c.
the comparison of actual performance to expected performance
d.
problem identification
e.
determining what corrective action will be if actual performance does not equal or exceed
expected performance
2. ____ is the regulatory process of establishing standards that will achieve organizational goals,
comparing actual performance to those standards, and then, if necessary, taking corrective action to
restore performance to those standards.
a.
Implementation
b.
Goal-setting
c.
Control
d.
Suboptimization
e.
Benchmarking
3. ____ are a basis of comparison for measuring the extent to which organizational performance is
satisfactory or unsatisfactory.
a.
Standards
b.
Potentials
c.
Autonomous goals
d.
Degrees of centralization
e.
Resource goals
4. The objective of the company that manufactures liqueur is to grow its international business. To
determine its success, it compares its current export sales to 1998, the first year it had double digit
growth in exports. For this company, the 1998 exporting data provide a(n) ____.
a.
autonomous measurement
b.
standard
c.
value ratio
d.
dependence measurement
e.
performance predictor
5. In October 2005, Cadbury Schweppes losses caused it to scale back its financial projections for the
remainder of the year. These financial projections were ____ for the beverage company.
a.
autonomous measurements
b.
standards
c.
value ratios
d.
dependence measurements
e.
performance charts
6. Companies may determine standards by ____.
a.
benchmarking other companies
b.
implementing vertical loading
c.
using outsourcing
d.
taking corrective action
e.
doing all of these
7. A report calling for a company to set clear targets to improve fuel economy and to cut factory
emissions would want the company to establish emission control ____.
a.
autonomous measurements
b.
standards
c.
value ratios
d.
dependence measurements
e.
performance predictors
8. ____ allows a trucking company not only to compare its safety performance with other companies but
to also adopt those practices found to be superior.
a.
Benchmarking
b.
Data decentralization
c.
Information processing
d.
Mirroring
e.
Comparative criterion
9. When Marriott decided to improve the quality of service offered to customers, it asked special
corporate guests to comment on the good and bad issues of their stay and also to tell what the
competition is doing that is better than Marriott. The Marriott acted accordingly. In other words, it
used ____.
a.
benchmarking
b.
data decentralization
c.
information processing
d.
mirroring
e.
comparative criterion
10. A chain of specialty fashion stores has interviewed a sample of its female customers and learned that a
customer can be expected to visit the store looking for new merchandise on average every two weeks.
The chain of stores was able to set this standard through ____.
a.
evaluating the standard’s capacity to enable goal achievement
b.
benchmarking competitors
c.
listening to customers
d.
outsourcing
e.
value communications
11. 14–1a
Control is a(n) ____ process.
a.
standardized, periodic, and cybernetic
b.
flexible, intermittent, and automated
c.
standardized, periodic, and robotic
d.
continuous, flexible, and automated
e.
continuous, dynamic, and cybernetic
12. Control is a cybernetic process because it ____.
a.
has a feedback loop
b.
is an intermittent process
c.
is the first management function
d.
uses automated benchmarks
e.
can be a completely automated process
13. The three basic control methods are ____.
a.
feedback control, feedforward control, and symmetry control
b.
balance control, vertical control, and symmetry control
c.
concurrent control, feedback control, and feedforward control
d.
feedforward control, presumptive control, and stasis control
e.
stasis control, feedback control, and simultaneous control
14. A manufacturer of automatic locking devices shipped 20,000 devices to a car manufacturer that was
unable to use them because of a design flaw. If the manufacturer of the devices waited until the parts
were returned before determining why it created unusable component parts, it would be using ____
control.
a.
feedforward
b.
feedback
c.
balanced
d.
dynamic
e.
concurrent
15. An accident at a U.S. refinery killed two workers. By gathering information about how the men died in
order to prevent a recurrence, the company used ____ control.
a.
concertive
b.
normative
c.
feedback
d.
concurrent
e.
bureaucratic
16. A car manufacturer ordered 20,000 window assemblies from a supplier. To make sure the assemblies
were made to specifications, the supplier of the window assemblies shipped a sample to the car
manufacturer for testing. This is an example of ____ control.
a.
feedback
b.
contiguous
c.
suboptimal
d.
feedforward
e.
synergistic
17. ____ control is a method of gathering information about performance deficiencies after they occur.
a.
Feedback
b.
Stasis
c.
Concurrent
d.
Feedforward
e.
Preemptive
18. ____ control is a method of gathering information about performance deficiencies as they occur.
a.
Feedback
b.
Simultaneous
c.
Concurrent
d.
Feedforward
e.
Stasis
19. ____ control is a method of gathering information about performance deficiencies before they occur.
a.
Feedback
b.
Stasis
c.
Preemptive
d.
Feedforward
e.
Concurrent
20. Which approach to control monitors inputs rather than outputs?
a.
feedforward control
b.
feedback control
c.
concurrent control
d.
stasis control
e.
all of these
21. ____ costs are the costs associated with implementing or monitoring control.
a.
Cybernetic
b.
Heuristic
c.
Regulation
d.
Benchmarked
e.
Targeted
22. McDonald’s fast-food restaurants have a well-designed training program for all new employees. Each
new employee is supposed to learn how to perform standardized tasks. Due to labor shortages in some
areas, these new employees begin work as soon as they are hired and do not receive any off-the-job
training. This nonconformity to standards creates ____.
a.
ambiguous group norms
b.
motivational grapevines
c.
negative benchmarks
d.
control loss
e.
monitoring valences
23. Which of the following factors can help managers determine whether more or different control is
worthwhile?
a.
regulation costs
b.
customer flows
c.
channelization
d.
synergy
e.
subordinate empathy
24. Imagine a manufacturer that has a 99 percent error-free production rate and decides it wants 100
percent error-free production. Its management needs to examine ____ to determine if the costs of
increased controls outweigh the benefits of error-free production.
a.
cybernetic costs
b.
benchmarks
c.
financial ratios
d.
regulation costs
e.
feedback loops
25. ____ is the extent to which it is possible to implement each step in the control process.
a.
Control feasibility
b.
Cybernetic feasibility
c.
A quasi-control assessment
d.
A Balanced Scorecard assessment
e.
Information management
26. According to the text, which of the following factors can help managers to determine whether more
control is possible?
a.
task downsizing
b.
cybernetic feasibility
c.
outsourcing
d.
channelization
e.
synergistic intelligence
27. Which of the following is a method managers can use to achieve control in their organizations?
a.
bureaucratic
b.
self-control
c.
concertive
d.
normative
e.
all of these
28. ____ control is top-down control in which managers try to influence employee behavior by rewarding
or punishing employees for compliance or noncompliance with organizational policies, rules, and
procedures.
a.
Bureaucratic
b.
Normative
c.
Concertive
d.
Objective
e.
Administrative
29. Companies that rely on bureaucratic control tend to ____.
a.
have no contingency plans
b.
rely on group norms rather than formalized rules and regulations
c.
value their human resources above all others
d.
be extremely responsive to their customers’ needs
e.
be highly resistant to change
30. When the local fast-food restaurant manager caught one of her employees giving free food to his
friends, she fired him on the spot. When another employee stayed late after work one night to help a
woman start her car, the manager rewarded him. What type of control did the restaurant manager use
in these two instances?
a.
bureaucratic
b.
objective
c.
self-control
d.
autocratic
e.
connotative
31. An organization that relies heavily on ____ controls is likely to be highly resistant to change and slow
to respond to customers and competitors.
a.
behavior
b.
bureaucratic
c.
subjective
d.
normative
e.
output
32. ____ controls should be used when it is necessary to standardize operating procedures and establish
limits.
a.
Bureaucratic
b.
Normative
c.
Concertive
d.
Input
e.
Output
33. The two types of objective controls managers use are ____.
a.
output and input
b.
administrative and participative
c.
self-control and organizational control
d.
autonomous and individualized
e.
behavior and output
34. A sales manager requires each member of his sales force to make three calls per day on current
customers, to call on two potential customers every week, and to sell a minimum of $10,000 worth of
merchandise weekly. Which of the following control methods does this indicate the sales manager is
using?
a.
normative
b.
market-oriented
c.
industrial betterment
d.
objective
e.
administrative
35. ____ control regulates workers’ actions and routines on the job, while ____ control measures the
results of their efforts.
a.
Input; behavior
b.
Motivation; output
c.
Concertive; normative
d.
Behavior; output
e.
Input; output
36. Marriott’s top management decided that there was need for a serious effort to “put democracy back in
the company” and make employees feel “involved in the success of the company.” Employees asked
special corporate guests to comment on the good and bad issues of their stay and also to tell what the
competition is doing that is better than Marriott. Then the employees acted accordingly. Marriott
adopted ____ control.
a.
autonomous
b.
concertive
c.
normative
d.
control
e.
focus
37. ____ should be used when it is difficult to create good measures of worker behavior and output and
when organizational culture, values, and beliefs are strong.
a.
Bureaucratic control
b.
Normative control
c.
Concertive control
d.
Self-control
e.
Input control
38. Normative controls should be used when ____.
a.
cause-and-effect relationships are clear
b.
workers have been taught self-control skills
c.
responsibility for task accomplishment is given to autonomous work groups
d.
it is necessary to standardize all operations
e.
organizational culture, values, and beliefs are strong
39. Which of the following statements about normative control is true?
a.
Normative control tends to create an organization that is highly resistant to change.
b.
With normative control, managers focus on work behavior or outputs.
c.
Normative control leads to an emphasis on very selective hiring.
d.
Normative control arises when companies give autonomous work groups complete
responsibility for task completion.
e.
None of these statements about normative control is true.
40. ____ control is associated with autonomous work groups.
a.
Objective
b.
Normative
c.
Behavior
d.
Concertive
e.
Output
41. Ironically, ____ control may lead to even more pressure for workers to conform to expectations than
____ control.
a.
concertive; normative
b.
normative; concertive
c.
bureaucratic; concertive
d.
concertive; bureaucratic
e.
behavior; concertive
42. Instead of individual sales people calling on its business customers, Cedartree Tech uses sales teams.
The sales team is given complete responsibility for developing long-term partnering relationships with
each customer. What kind of control would the company’s sales managers most likely approve?
a.
human resources control
b.
participative control
c.
self-control
d.
administrative control
e.
concertive control
43. A manager has instructed Ralph and his fellow workers to develop a daily theme such as patience,
empathy, and kindness. Each day, the workers are to try to emphasize the theme as they work with
customers, suppliers, and each other. What kind of a control system is Ralph’s manager using?
a.
self-control
b.
human resources control
c.
non-administrative control
d.
output control
e.
bureaucratic control
44. ____ is a control method that encourages managers to look beyond traditional measures to evaluate
four different perspectives on company performance.
a.
Optimization
b.
Customer churn
c.
Balanced Scorecard
d.
Customer defection
e.
Financial ratio analysis
45. Which of the following is NOT one of the four perspectives measured in the Balanced Scorecard
approach to control?
a.
financial perspective
b.
policies and procedures perspective
c.
customer perspective
d.
internal business perspective
e.
innovation and learning perspective
46. A provider of computer technical support that is using the Balanced Scorecard approach to control
would look at ____.
a.
the percentage of its employees that have received training during the last year
b.
customer defections
c.
its cash flow
d.
percentage of computer owners that requested support more than five times in a month
e.
all of these and more
47. Which of the following statements about the Balanced Scorecard approach to control is true?
a.
The customer perspective is the most important in the control process.
b.
The company’s analysis of its controllable environment is most important to the company’s
success.
c.
The innovation and learning perspective is the most important in the control process.
d.
The company’s analysis of its noncontrollable environment is most important to the
company’s success.
e.
All of the perspectives examined by the Balanced Scorecard approach are of equal
importance to a company’s success.
48. ____ occurs when performance improvement is attained in one part of an organization but only at the
expense of decreased performance in another part.
a.
Suboptimization
b.
Control loss
c.
Cybernetic infeasibility
d.
Feedforward control
e.
sacrificing
49. A large university library has decided to make it nearly impossible for all but the most renowned Civil
War experts to access their Civil War collection. The librarian in charge of this collection feels that
this new policy will adversely influence the use of the collection in research on the experiences of
everyday people during the war. This is an example of the use of control creating ____.
a.
suboptimization
b.
control loss
c.
cybernetic infeasibility
d.
feedforward control
e.
sacrificing
50. One of the advantages the Balanced Scorecard has over traditional control processes that rely solely on
financial measures is that it ____.
a.
encourages control delegation
b.
eliminates problems with regulation costs
c.
minimizes the chances of suboptimization
d.
allows companies to determine the ideal control methods
e.
creates functional independence
51. The Balanced Scorecard approach to control ____.
a.
forces managers at each level of the company to set specific goals and measure
performance in each of four areas
b.
places greatest priority on the most important aspect of control, the financial perspective
c.
maximizes the chances of suboptimization
d.
only looks at factors within a company’s controllable environment
e.
has no real advantages over traditional control techniques
52. When implementing the financial perspective, managers would use ____.
a.
financial ratios
b.
customer defections
c.
employee turnover
d.
value analyses
e.
competitive audits
53. In the traditional control systems used at most companies, ____ measures are used to assess
performance.
a.
financial
b.
customer
c.
value/quality
d.
quality/profit
e.
optimization
54. The traditional approach to controlling financial performance does NOT examine ____.
a.
financial ratios
b.
customer defections
c.
cash flow