PYQ 8

VERY SHORT ANSWER QUESTIONS ( 1 or 2 Marks)

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 BOARD 2017)

Answer. The step that is being performed by Harsh is Measurement of Actual Performance under
the controlling function of management.

QUESTION 2.
What is the formula of Return on Investment.
Answer. Net Profit
Total investment

QUESTION 3.
What do you understand by key KRAs result areas?
Answer. The areas which are critical to the success of an organization.

QUESTION 4.
What should be done while 'taking corrective action' in process of controlling, when especially
in the important areas deviations go beyond the acceptable range?
Answer. When deviations in important areas go beyond the acceptable range, immediate
managerial attention is required. In this regard, a manager can train, educate and develop
employees so that deviations can be controlled. This will lead to no or minimum level of
deviations.

QUESTION 5.
Why planning is an empty exercise without controlling function?
Answer. Planning is an empty exercise without controlling because implementation of plans and
monitoring of plan depend upon controlling.

QUESTION 6.
Which two steps in the process of controlling are concerned with compelling events to conform
to plan?
Answer.
a) Comparison of actual performance with standards.
b) Taking corrective actions.

QUESTION 7.
If you want to control everything you may end up controlling.
Answer. Management by exception.

QUESTION 8.
Define Management Audit.
Answer. Management audit refers to systematic performance appraisal of the management of
an organisation.

QUESTION 9.
Why is controlling considered to be a backward looking?
Answer. Controlling involves evaluation of past activities to find out deviations from standards
so it is a backward looking function.

QUESTION 10.
Name two types of profitability ratios?
Answer.
a) Gross Profit Ratio
b) Net Profit Ratio.

QUESTION 11.
What do you call the sales volume at which there is no profit, No loss?
Answer. Breakeven Point (BEP).

QUESTION 12.
Give 2 examples of Corrective Action.
Answer.
a) Provide training
b) Revive standards.

QUESTION 13.
Give two examples of responsibility centers.
Answer. Cost Centre, revenue center etc.

QUESTION 14.
Marketing department comes under which type of responsibility center.
Answer. Revenue Centre.

SHORT ANSWER QUESTIONS (3 or 4 Marks)

QUESTION 15.
'Planning is looking ahead and controlling is looking back'. Comment.
Answer :
Planning is looking ahead and controlling is looking back. This statement is partially true.
Planning is a psychological process of 'thinking and deciding in advance' about 'what is to be
done' and 'how it is to be done'. It is a mental activity that includes deciding the goals and also
the actions through which they are to be accomplished. Thus, it is said that planning is looking
ahead as it involves predicting the future.
Controlling on the other hand, involves an assessment of the past performance and evaluating
them against the set standards. In this sense, controlling is said to be a backward-looking
function.
However, both these statements are only partially true. Though planning is a futuristic concept
but it is based on past actions and experiences. Planning for future cannot take place without
peeping into the past. Similarly, though controlling involves assessment of past performance, it
also aims at improving the future performance by taking the required corrective actions. Hence,
we can say that planning and controlling are backward looking as well as forward looking
functions.

QUESTION 16.
Write a short note on budgetary control as a technique of managerial control.
Answer:
Budgetary control is a technique of controlling that involves preparing plans in the form of
budgets. Budget refers to a financial or a quantitative statement that defines the targets to be
achieved and the policies to be followed in a specific period of time. The actual performance is
then compared with the budgetary standards. This comparison helps in identifying the deviations
and thereby, guides in taking appropriate corrective measures. Budget can be prepared for
different divisions of the organisation such as sales budget, production budget, purchase budget,
etc. However, for the budgeting to be effective, future estimates must be made carefully.
Budgeting also acts as a source of motivation for the employees by setting the standards against
which their performance will be assessed. Thus, it encourages them to achieve the set objectives.
In addition, it is also used to facilitate coordination among different divisions/departments of the
organisation. Moreover, proper budgeting ensures that resources are allocated to different
divisions as per their requirements. Thereby, it helps in optimum utilisation of the resources

LONG ANSWER TYPE QUESTIONS (5 OR 6 MARKS)

QUESTION 17.
'I-phone India Ltd.' is a manufacturer of advanced category of mobile phones. The company
trained its engineers from Japan. It markets its mobile phones domestically as well as
internationally. The company had a substantial market share and had a loyal customer
following because of quality of its i-phone. From the last financial year the company had been
unable to achieve its targets because of competition in the market. The company is planning
to revamp its controlling system,
(i) Identify the concepts of management involved in the above para.
(ii) State the steps of the revamped controlling process to be followed by the company to solve
this problem.
(iii) Also, state any one value, which the company wants to communicate to the society.

(CBSE BOARD 2015)

Answer.
(i)Staffing and Controlling.
(ii) The two steps which must be followed by the company to solve this problem are:
(a) Analysing deviations.
(b) Taking corrective action
(iii)Value which the company wants to communicate to the society:
(a) Serving the society by providing quality products.
(b) Growth and development.

QUESTION 18.
State any five points that highlight the importance of controlling.

(CBSE BOARD 2016)

Answer. Controlling is an important and an indispensable function of management. It aims at
managing the managerial actions by setting standards and identifying the deviations of actual
performance as against the set standards. It also ensures optimum utilisation of resources while
taking corrective measures for the deviations. The following are the factors that highlight the
importance of controlling.
1. Controlling helps in achieving organizational goals: The controlling function measures
progress towards the organizational goals and indicates deviations if any to take corrective
action.
2. Judging accuracy of standards: An efficient control system enables management to verify
whether the standards set are accurate or not by carefully checking the changes taking place in
an organizational environment.
3. Making efficient use of resources: Efficient utilization of resources through controlling process
enables a manager to reduce wastage of resources.
4. Improving employees motivation: An efficient control system ensures that employees know
well in advance what they are expected to do & also the standards of performance. It thus
motivates & helps them to give better performance.
5. Ensuring order and discipline: Controlling function creates an atmosphere of order and
discipline in the organization by keeping a close check on the activities of its employees.
6. Facilitating Coordination in action: Predetermined standards are set for governing each
department and employee in an organisation.

QUESTION 19.
Describe briefly the relationship between controlling and planning.

(CBSE BOARD 2017)

Or
'Planning and Controlling are inseparable twins of management.' How?
Answer. Planning and controlling are closely interrelated functions of management. On one
hand, Planning refers to the psychological process of thinking and deciding about what is to be
done and how it is to be done. That is, planning decides the objectives to be achieved and the
course of action to be followed. On the other hand, controlling refers to the process of managing
and evaluating the work done in accordance with the standards and taking corrective measures,
if there are any deficiencies. These standards that form the basis of controlling are provided by
planning. The various objectives and policies as formulated under planning serve as standards
against which the actual performance is evaluated. Controlling without planning is meaningless.
If there are no standards, no objectives, there is nothing to control. That is, if the managers do
not know what the final objective is, they do not have any standard against which they can judge
the current performance and deficiencies. Similarly, planning without controlling holds no
meaning. Once the plans are formulated, it becomes necessary to monitor and evaluate whether
the performance is as per the desired plans. If there is no controlling, planning cannot be
accomplished. Thereby, planning without controlling is of no use. Thus, it can be said that both
planning and controlling complement each other.
Both the concepts of planning and controlling are interlinked in a way as they are forward looking
as well as backward looking. Though it is said often that planning is looking forward and
controlling is looking backward, however, the statement is only partially true. Though planning is
a futuristic concept dealing with preparing plans and setting standards in advance, it is also based
on past experiences and actions initiated in the controlling function. Thus, planning besides being
forward looking, is backward looking as well. Similarly, although controlling is based on the past
actions and deals with comparing the current actions with the pre-defined standards, it also
focuses on taking the corrective actions to improve the future performance of the management.
Thus, controlling besides looking back also looks forward.
Hence, while on one hand, planning is a prerequisite for controlling, on the other hand,
controlling is incomplete without planning. Both are inseparable functions that support each
other towards the achievement of the goals of the organisation.

QUESTION 20.
A company was manufacturing solar panels for charging of mobiles, which were in great
demand. It was found that the largest of producing 500 solar panels a day was not being met
by the employees. On analysis it was found that the workers were not at fault. Due to nonavailability
of raw materials 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 66 additional workers were required out of which 6
would work as heads of different department and 10 would work as subordinates under each
head. The required qualifications and job specifications were also enlisted. It was also decided
that necessary relaxation should be given to encourage women, persons from backward and
rural areas and persons with special abilities to assume responsible positions in the
organisation. All efforts were made to match the ability of the applicants with the nature of
work.
a. Identify the functions of management discussed above.
b. State the two steps in the process of each function discussed in the above para.
c. List any two values which the company wants to communicate to the society.

(CBSE BOARD 2015)

Answer
a. The functions of management discussed above are staffing and controlling.
Quote for ‘staffing’: To meet the increased demand the company assessed that approximately
66 additional workers were required out of which six would work as heads of different
department and 10 would work as subordinates under each head.
Quote for ‘controlling’: It was found that the largest of producing 500 solar panels a day was not
being met by the employees. On analysis it was found that the workers were not at fault. Due to
non-availability of raw materials and shortage of workers, the company was not able to achieve
the set targets and alternative arrangements were needed.
b. Steps in Staffing Function
i. Estimation of Required Manpower: As a first step, the number of persons and the kind of
persons required in the organisation must be estimated properly.
It involves the following two steps:
1) Workload Analysis: It refers to the number of persons and the kind of persons required in an
organisation.
2) Workforce Analysis: It refers to estimating the existing number of persons in the organisation.
ii. Recruitment/Searching: It refers to searching for prospective candidates and convincing them
to apply for job vacancies. For the recruitment process, internal sources (transfers and
promotions) and external sources (advertising and placement agencies) can be used.
Steps in Controlling Function
i. Comparing Performance: After the actual performance is measured, it can be compared with
the pre-defined standards. This helps in assessing whether there are any deviations/deficiencies
in performance. Accordingly, it helps in identifying the required corrective actions to be taken.
ii. Analysing Deviation: With the comparison of the actual performance with the set standards,
deviations in performance are identified.
c. Values which the company wants to communicate to society:
i. Use of environment-friendly methods of production
ii. Women empowerment

QUESTION 21.
Explain the various steps in the process of controlling
Answer:
Controlling refers to the process of evaluation and assessment of the work done. Under the
process of controlling, standards are set for various tasks and activities. Accordingly, the various
tasks and activities are evaluated against the set standards.
Steps involved in the controlling process:
i. Setting Standards: The first step is setting Standards are the criteria against which actual
performance can be measured. The standards can be in both qualitative terms and quantitative
terms. It must be kept in mind that the set standards should facilitate easy comparison.
ii. Measuring Actual Performance: The next step in the controlling process is to measure the
performance of various activities. For this, various techniques can be used such as personal
observation and performance reports. This measurement should be exact and reliable such that
it facilitates easy comparison with the set standards. Moreover, the measurement of
performance can be at various stages in the activity or at the completion of the activity.
iii. Comparing Performance: This step involves comparison of actual performance with the
standard. Comparison will reveal the deviation between actual and desired performance. If the
performance matches the standards, it may be assumed that everything is under control.
Accordingly, it helps in identifying the required corrective actions to be taken.
iv. Analysing Deviation: With the comparison of the actual performance with the set standards,
the deviations in performance are identified. For analysing deviations, the following methods can
be used:
(a) Critical Point Control: Control should focus on key result areas (KRAs) which are critical to
the success of an organisation. These KRAs are set as the critical points.
(b) Management by Exception: Management by exception is often called as control by
exception, is an important principle of management control, based on the belief that an
attempt to control everything results in controlling nothing. In short, everything cannot be
controlled at the same time.
Deviations should be identified and their causes must be recognised. Some causes for deviations
can be infeasible standards, deficiencies in process and dynamic business environment.
v. Taking Corrective Action: In case deviations are beyond the acceptable range, it becomes
necessary to take corrective action. It must be ensured that the deviations do not occur again.
No corrective action is required when the deviation are within the acceptable limits.

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.

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.

Q. 1. Babita Ltd. is engaged in manufacturing machine components. The target production
is 250 units per day per worker. 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 200-210 units per worker.
1. Name the function of management and identify the step 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 (a) and to ensure the
performance as per set targets, explain what further steps a manager has to take.
(5 marks)
Ans.
1. The management function is Controlling.
“Comparing actual performance with standards” is the step involved in the process of
controlling which helped in finding out that the actual production of a worker is less than the
set target.
1. A manager has to take the following two further steps to complete the process of
controlling:
1. Analysing deviations
2. Taking corrective action

Q. 2. Rajeev and Sanjeev are managers in the same organization having different units.
While discussing about the function of management, Rajeev says “Planning is looking
ahead whereas controlling is looking back.” But Sanjeev says, “Planning is looking back
whereas controlling is looked ahead.” Both are giving reasons in favour of their statements.
Explain the possible reasons given by both and justify who is correct. (6 marks)
Ans. Rajeev who says, “Planning is looking ahead whereas controlling is looking back” must
be giving the following reason:
Sanjeev who says, “Planning is looking back where as controlling is looking ahead” must be
giving the following reasons.
Conclusion: Planning and controlling are both backward looking and forward looking
functions. Hence, both of them are partially correct.

Q. 3. ‘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 managements 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.
Ans.
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:
1. Rural development:
2. Sense of responsibility:

Q. 4. 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 materials 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, the 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.
Ans.
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
planning 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 of development to an organization 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.

Q. 5. Atul and Ajay are good friends. They decide to set up a digital printing press together
as both of them are compute wizards. They plan to offer various types of printed products
including labels, manuals, marketing material, memo pads, business order forms, T-shirts,
mugs etc. They set standards for every aspect of their work in order to create an efficient
working environment. As per the standards, an average person types between 38 and 40
words per minute. Keeping this in mind, they engage two typists Bitto and Raju and assign
them work accordingly. Within two days, they realize the output in terms of typing work done
by Raju is too less as compared to the desired output. On inspecting, Atul finds out that
Raju’s typing speed is between 18 and 20 words per minute only. But Raju exhibits great
skills in designing work and is a good human being. Hence, Atul and Ajay decide to retain
him for doing creative work and appoint a new typist.
In context of the above case:
1. Identify and explain the function of management being discussed here.
2. List the steps involved in the function of management as identified in part (a).
Also, quote the liens from the paragraph relating to each step.
Ans.
1. Controlling is the function of management being discussed here.
2. The steps involved in the process of controlling which are discussed in the above
paragraph are:
1. Setting standards of performance:
2. Measurement of actual performance:
3. Comparison of actual performance with the standards:
4. Analyzing deviations:
5. Taking corrective action:

Q. 6. D & D Ltd. is a large manufacturing unit. Recently, the company has conducted the
‘time’ and ‘motion’ studies and concluded that on an average a worker could produce 120
units per day. However, it has been noticed that average daily production of a worker is in
the range of 80-90 units.
Which function of management is needed to ensure that the actual performance is in
accordance with the performance as per ‘time’ and ‘motion ‘studies? State four features of
this function of management. (5 marks)
Ans. Controlling
Features of controlling:
1. Controlling is a goal-oriented function
2. Controlling is a pervasive function
3. Controlling is a continuous process
4. Controlling is both a backward looking as well as forward looking function.

Q. 7. ‘A.S. Ltd.’ is a large company engaged in assembly 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 assembly of air-conditioners per day is i800 units only. To find out the reason the
company compared actual performance of each worker and observed through C.C.T.V. that
some of the workers were busy is gossiping.
1. Identify the function of management discussed above.
2. State those steps in the process of the function identified which are discussed in the
above praragraph. (3 marks)
Ans.
1. Controlling
2. Steps discussed in the above paragraph are:
1. Setting performance standards
2. Measurement of actual performance
3. Comparing actual performance with the standards
4. Analyzing deviations for their causes.

Q. 8. A company ‘M’ Ltd. is manufacturing mobile phones both for domestic Indian market
as well as for export. It has enjoyed a substantial market share and also had a loyal
customer following. But latterly it has been experiencing problems because its targets have
not been met with regard to sales and customer satisfaction. Also mobile market in India
has grown tremendously and new player have come with better technology and pricing.
This is causing problems for the company. It is planning to revamp its controlling system
and take other steps necessary to rectify the problems it is facing.
1. Identify the benefits the company will derive from a good control system.
2. How can the company relate its planning with control in this line of business to ensure
that its plan are actually implemented and targets attained?
3. Give the steps in the control process that the company should follow to remove the
problems it is facing.
Ans.
1. Explain the importance of controlling.
2. Company can relate its planning with control in this line of business by following
measure by implementing an effective controlling system and following a controlling
process.
3. Explain steps in the process of controlling system.

Q. 9. Alpha Ltd. was manufacturing Auto spare parts. To improve the efficiency of
employees the company provided training to their employees by inviting an expert who
demonstrated the whole process of manufacturing. The expert quoted that all deviations
cannot be controlled, so manager must know which deviation in key areas must be attended
urgently as compared to deviation in non-key area. He also suggested that human beings
are bound to brake mistakes as manager should not take strict action on every minute
mistake of workers, rather he can fix a range of deviation and take action if deviation is
above the specified large.
1. Identify the functions of management referred above.
2. Name the two ways of analyzing deviation mentioned above.
3. Name the method of training used by the company.
4. Identify the value being emphasized in above para.
Ans.
1. Staffing and controlling
2. (i) critical Point Control
(ii) Management by exception
1. Apprenticeship method of training
2. Value of Humanity.

Q. 10. 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 your 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 t he supplier must b e under 4 0 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
organizational goals and ensure efficient use of resources?
Ans.
1. Analyzing 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
organization, there for every organization identifies and states its specific key result
area (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:
1. Accomplishing organizational goals:
2. Making efficiently use of resources:

Q. 11. 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 realized 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.
Ans.
1. The two aspects about his business that Raghav was controlling in order to make it
successful are listed below:
1. A standard taste was maintained.
2. The orders were executed on time.
1. The two points that highlight the importance of the controlling function are listed
below:
1. Judging accuracy of standards:
2. Improving employee motivation:
1. Rohit had adopted an autocratic style of leadership. An autocratic leader expects
strict compliance form his subordinates with regard to the orders and instructions
given by him. Therefore, it involves only one-way communication.

Q. 12. 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. Mr. Nath’s behavior is good towards the employees. His attitude is
always positive. So he announced various incentive schemes for the employees like.
- installing award or certificate for best performance.
- Rewarding an employee for giving valuable suggestions.
- Congratulating the employees for good performance.
(a) Identify the functions of management highlighted in the above paragraph.
(b) State the ‘incentive’ under which the employees are motivated.
(c) State any two values which the production manager wants to communicate to the society
by his work and behavior. (5 marks)
Ans.
1. Controlling and Directing
2. Employee recognition programme (non-monetary incentive)
3. Values:
● Sensitivity to environment
● Good behavior towards employees
● Team work with employees

Q. 13. Joseph Bros. was a firm manufacturing jute lamp shades. It uses left over jute pieces
from various jute factories to manufacture economical lamp shades which are supplied to
various hotels in nearby towns: it employs men and women from nearby villages as
workers for creating good lamp shade designs.
Joseph Bros., is not able to meet its targets. Namish, the supervisor of the company, was
told to analyze the reasons for the poor performance. Namish found following problems and
suggested certain solution s in the working of the business. M the number of workers
employed was les than what was required for the work. As a result, the existing workers
were overburdened. The firm decided to search for new workers and it asked the present
employees to introduce candidates or recommend their friends and relatives to the firm.
This enabled the firm in “putting people to jobs” and assured attainment of objectives
according to plans.
1. Identify the functions of management being performed by the firm in the above
situation.
2. Name the concept and its source used by the firm to attract more workers for the firm.
3. State any two values being followed by Jacob Bros. (5 marks)
Ans.
1. Staffing and Controlling
2. Recruitment, External Source of Recruitment (Recommendations of employees)
3. Values being followed by Joseph Bros.:
1. Creating employment opportunities.
2. Utilizing resources efficiently by using leftover clothes.

Q. 14. 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 relaxation should be
given to encourage women, persons from backward and rural areas and persons with
special abilities to assume responsible positions in the organization. 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 para.
3. List any two values which the company wants to communicate to the society
(6 marks)
Ans.
1. Staffing and controlling
2. Step in Staffing
1. Estimating manpower requirements:
2. Recruitment:
1. Steps in controlling:
1. Comparison of actual performance with the standards:
2. Analyzing deviations:
3. Taking corrective action:
1. Values which the company wants to communicate to the society:
1. Using environment friendly methods of production.
2. Women empowerment.
3. Upliftment of underprivileged sections of the society.

Q. 15. Airtech Ltd. is manufacturing mobile phones both for domestic Indian market as well
as for export. It has enjoyed a substantial market share and also had a loyal customer
following. But lately it has been experiencing problems because its targets have not been
met with regard to sales and customer satisfaction. Also, mobile market in India has grown
tremendously and new players have come with better technology and pricing. This is
causing problems for the company. It is planning to revamp its controlling system and take
other steps necessary to rectify the problems ikt is facing. It also decides to offer its basis
models of mobile phones at 50% discount to the poor people.
1. State any two benefits the company with derive from a good control system.
2. How can the company relate its planning with control in this line of business to ensure
that its plan are actually implemented and targets attained.
3. Give the steps that the company should follow to remove the problems it is facing.
4. Identify any one value which the company wants to communicate to the society.
(6 marks)
Ans.
1. Two benefits which the company will derive from a good control system are:
1. Accomplishing organizational goals of increasing market share and customer
satisfaction.
2. Making efficient use of resources by controlling wastage and spoilage of resources;
and ensuring that each activity is performed according to the predetermined
standards.
1. Controlling will improve future planning by providing information to the company
derived from past experience that its targets were not met with regard to sales and
customer satisfaction.
2. The company should undertake technological up gradation of machinery, and modify
the existing process so that cost is reduced and the company can set lower price for
its mobile phones to bet its competitors.
3. Value:
● Concern about poor people
● Social responsibility

Q. 16. You are the manager of Bharti Chemicals Ltd. it is reported to you that postal
expenses have increased by 10% over standard rates and cost of raw materials has
increased by 2%. Which of the two deviations will be more critical to you? (1 mark)
Ans. Increase in cost of raw materials by 2% is more critical. (Critical Point Control)

Q. 17. Surbhi Ltd. produces safety pins on a mass scale. The company’s policy is that at
most 25 of the daily production could be defective. Over a three months period, it has been
observed that 8% - 10% of the production is defective. The cause of deviation found is
defective machinery. What corrective action should be taken by the management? (1 mark)
Ans. Repair the existing machine or replace the machine if it cannot be repaired.

Q. 18. K & K Co. Ltd. is engaged in manufacturing machine components. The target
production is 200 units daily. The company had been successfully attaining this target until
two months ago. Over the last few 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 desired targets. (5marks)