GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 7 Controlling

Gujarat Board GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 7 Controlling Important Questions and Answers.

GSEB Class 12 Organization of Commerce and Management Important Questions Chapter 7 Controlling

Short Answer Type Questions

Question 1.
Define controlling in general terms.
Answer:
In layman language, controlling means to decide the activities to be carried out, evaluate, the same and if required, take corrective measures so that they are done – in conformity with plan developed by the organization.

Question 2.
State the definition of controlling as given by Drucker.
Answer:
According to Peter F. Drucker, “Controlling is to maintain a balance between efforts and results and between resources and objectives.”

Question 3.
At which level of management is controlling needed?
Answer:
At every level

Question 4.
What is the objective of controlling function?
Answer:
To see that errors, wastage and losses which occurred in the past are not repeated or take place in controlled manner.

Question 5.
Why it is said that controlling never ends?
Answer:
It is wrong to believe that once control is exercised on the activities of the enterprise, work will always be done according to the plan. Deviations from the set plan can occur at any level and at any time. Hence, controlling has to continue at all stages and it never ends.

Question 6.
Why is it said that controlling is an act for future?
Answer:
The core objective of control is to minimize deviations and errors in processes so that end product or service comes out as planned. In this sense, it can be said that control is related to future.

Question 7.
What misbelief do people have with respect to controlling?
Answer:
People believe that under controlling a person is always monitored and hence his freedom is lost.

Question 8.
How is controlling beneficial to the workers?
OR
What is the real purpose of controlling in terms of workers?
Answer:
The real objective of control is to see that workers work as per the plan and that they are guided properly to overcome mistakes and deviations. This helps the workers to improve their precision and hence efficiency.

Question 9.
Although controlling is a planned activity, it is also called dynamic. How is this possible?
Answer:
If the organization identifies deviations in its processes, it takes quick decision in its control methods to normalize these processes. Hence, although controlling is a planned function, it is a dynamic process.

Question 10.
Why controlling is called barometer of efficiency of the business?
Answer:
In business enterprises if control is exercised efficiently, management becomes more efficient. So controlling is called the barometer of efficiency of management.

Question 11.
How does controlling help against external changes?
Answer:
Taking into consideration the effect of external factors, controlling decides whether activities are being carried out according to plan or not. If not, it suggests the organization to modify the plan and processes.

Question 12.
What is pre-requisite for executing control?
Answer:
Setting standards for parameters to control.

Question 13.
Give few examples for which standards can be set.
Answer:
Standards can be set for cost price, income, capital, profit targets, production targets, cost targets, etc.

Question 14.
What is done in the gathering information stage of controlling?
Answer:
Information is gathered for the business processes.

Question 15.
Which is the last stage of controlling?
Answer:
Taking corrective measures.

Question 16.
When can there arise a situation of changing the standards?
Answer:

• If the standards are not met continuously and
• If the organization over-achieves the standards.

Long Answer Type Questions

Question 1.
Explain point-wise the relation between planning and controlling.
Answer:
Below given points will clarify the relation between the two:
1. Planning and controlling are two sides of the same coin:

• Planning and controlling are two very important and interdependent functions of the management process. The success of planning depends on Controlling.
• The function of controlling identifies deviations, takes necessary corrective action and hence keeps the business activities on the decided direction.
• Looking from other perspective, the role of controlling comes only when something is planned. So, if there is no planning, there is no controlling.
• Thus, planning and controlling are two sides of the same coin.

2. Protection against change:

• How well will the programmes of a plan executed depends on internal as well as external factors. Internal factors are factors related to organization work procedures, policy, human resource, etc. External factors include government policy, competition, inflation, depression, scarcity of raw materials, change in the choices of people, change in fashion, etc.
• Taking into consideration the effect of external factors, controlling decides whether activities are being carried out according to plan or not. If not, it suggests the organization to modify the plan and processes.
• Thus, planning and controlling give protection against changes.

3. Planning is a pre-condition for controlling:

• The function of planning is to make programmes to achieve the objectives of the business enterprise. On the other hand, the function of controlling is to see whether the activities are performed according to the plan or not.
• Additionally, controlling also compares the actual performance with the set standards. If deviations are found, corrective action is taken.
• Thus, controlling begins only after planning is done or say planning is the pre-condition of controlling.

4. Planning is the father of controlling:

• Controlling exists because of planning. Controlling keeps a check on activities decided in planning.
• In short, controlling does not exist without planning.
• Hence, it can be said that planning is the father of controlling.

Question 2.
What changes can organizations face due to internal and external factors? How does controlling works as a shield against these changes?
Answer:
Protection against change:

• How well will the programmes of a plan executed depends on internal as well as external factors. Internal factors are factors related to organization work procedures, policy, human resource, etc. External factors include government policy, competition, inflation, depression, scarcity of raw materials, change in the choices of people, change in fashion, etc.
• Taking into consideration the effect of external factors, controlling decides whether activities are being carried out according to plan or not. If not, it suggests the organization to modify the plan and processes.
• Thus, planning and controlling give protection against changes.

Question 3.
List out the stages of controlling process.
Answer:
Stages of controlling process:

1. Setting standards
2. Gathering information
3. Measuring performance
4. Comparing actual performance with set standards
5. Corrective measures

Question 4.
How does an organization set its standards for executing the control process?
Answer:
Setting standards:

• The first stage of controlling is to set standards. Standards measure efficiency of the processes and people.
• By setting standards, the organization can compare if the activities are taking place according to the set standards.
• Unless standards are set, it is not possible to decide what to control and how to control.
• These standards can be both qualitative and quantitative.
• The standards could be set for cost price, income, capital, profit targets, production targets, cost targets, etc.
• Standards may be set for long term or short term.
• Standards are decided at the top level management. Employees and subordinates are informed about the same.
• The employees then plan their work according to the given targets and they constantly strive to maintain these standards.

Question 5.
What is a measurement of performance?
Answer:
Measuring performance:

• After gathering information about the performance of business performance, the set parameters are measured.
• The objective of measuring is to obtain data from the various processes of the organization so that it can be later compared with the set standards.
• Measurement can be either qualitative or quantitative or both.

Question 6.
State the measures that can be taken under corrective measures.
Answer:
Corrective measures:

• Corrective measure is the last stage of the controlling process.
• In the fourth stage, the activities are compared against set standards to find out deviations.
• If deviations are present, necessary corrective measures can be taken.

Question 7.
When does a company come under the need of changing standards and adopting new standards?
Answer:
Corrective measures:

• Corrective measure is the last stage of the controlling process.
• In the fourth stage, the activities are compared against set standards to find out deviations.
• If deviations are present, necessary corrective measures can be ‘ taken.

Question 8.
What role does corrective measure play in controlling process?
Answer:

• Corrective measure is the last stage of the controlling process.
• In this stage, the activities are compared against set standards to find out deviations.
• If the organization finds out deviations in the actual performance against the set standards, then it takes necessary corrective measures to fix the deviations and prevent them in future.
• By applying corrective measures the organization can control the output of its process. If the output is highly deviated, the organization can reject the product (or service) it created for its customers.
• Corrective measure helps the organization to know the details about the various corrections its people made, the type of corrections, the frequency and so on.
• The organization by studying and analyzing the corrective measures can . improve its future processes.

Question 9.
Enlist few benefits that an organization can derive by adopting corrective actions.
Answer:
An organization derives following benefits by adopting corrective measures:

• Time saving
• Reducing customer complaints
• Increasing efficiency of employees
• Increasing efficiency of business processes
• Saving organizational resources such as raw material, capital, etc.
• Increasing customer loyalty and trust
• Improving prestige in the market

Multiple Choice Questions

Question 1.
Controlling is the step of management process.
(A) First
(B) Second
(C) Second last
(D) Last
Answer:
(D) Last

Question 2.
_________ and controlling are the two sides of the same coin.
(A) Directing
(B) Planning
(C) Organizing
(D) Staffing
Answer:
(B) Planning

Question 3.
Controlling takes care of _________
(A) Checking the progress of managerial tasks
(B) Comparing them with the standards set by the organization
(C) Identify deviations between the organizational standards and the actual work going on in the organization
(D) All of these
Answer:
(D) All of these

Question 4.
If there is no _________, there is no scope of controlling.
(A) Organizing
(B) Directing
(C) Executing
(D) Planning
Answer:
(D) Planning

Question 5.
Controlling helps to maintain balance between _________ and _________
(A) Sales and production
(B) Drawings and capital
(C) Efforts and outputs
(D) All of these
Answer:
(C) Efforts and outputs

Question 6.
In the controlling function, is/are important activities that need to be constantly controlled.
(A) Quality control
(B) Cost control
(C) Service and quality control
(D) Both (A) and (B)
Answer:
(D) Both (A) and (B)

Question 7.
The top level management cannot delegate
(A) Authority
(B) Responsibility
(C) Company resources
(D) Accountability
Answer:
(D) Accountability

Question 8.
What do standards measure?
(A) Efficiency
(B) Capability
(C) Optimum level
(D) All of these
Answer:
(A) Efficiency

Question 9.
If the established standards are not attained continuously, it clearly means that the
(A) Standards are too high to meet
(B) Workers are inefficient
(C) Set standards might need to change
(D) Both (A) and (C)
Answer:
(D) Both (A) and (C)

Controlling – GSEB Std 12 Organization of Commerce and Management Notes

Meaning of control:
In layman language, controlling means deciding the activities to be carried out, evaluate, the same and if required, take corrective measures so that they are done in conformity with plan developed by the organization. Controlling is the last step of management process.

Characteristics:

• Related to planning
• Functions at every level of management
• Continuous process
• End activity of management
• Related to future
• Constructive activity
• Internal process
• Dynamic process
• Person-oriented
• Can be formal or informal

Importance:

• Helpful in achievement of objectives
• Controlling on activities
• Makes planning effective
• Co-ordination between various activities
• Evaluation of activities
• Removes deviations
• Necessary for delegation of authority
• Finds out errors
• Long term planning
• Helpful in directing
• Barometer of efficiency

Relation between planning and controlling:

• Planning and controlling are two sides of the same coin
• Protection against changes
• Planning is the pre-condition for control
• Planning is the father of controlling

Stages of controlling mechanism:

• Setting standards
• Gathering of information
• Measuring performance
• Comparing work done with set standards

Corrective measures:
(A) No change in condition
(B) Change the condition to remove deviation
(C) Change the condition and establish new standards