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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.
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