Explore topic-wise InterviewSolutions in .

i. Wastage of time. 

ii. Union not to make unnecessary pressure of officials. 

iii. Threatening to strike on small matters is unhealthy practice.

(a)  Authority

(b) Fixing standard

Controlling the process of ensuring that actual activities conform to planned activities.

Various steps in the controlling process:

i. Setting performance standards: The standards of performance are set which serve as the criteria against which actual performance will be measured.

ii. Measurement of Actual Performance: The measurement of actual performance is done on the basis of pre-determined standards. It tells the manager whether the work has been done according to the plan or not.

iii. Comparing actual performance with the standards: Actual performance is compared with the standards to find out the deviation.

iv. Analysing deviations: Deviations are analysed for their causes through Critical Point Control and Management by Exception.

v. Taking corrective action: Corrective action is taken if deviations go beyond the acceptable limits.

i. Zero Deviation

ii. Positive Deviation.

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.

• 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.

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.

i. Accomplishing Organisational Goals: The controlling process is implemented to take care of the plans. With the help of controlling, deviations are immediately detected and corrective action is taken. Therefore, the difference between the expected results and the actual results is reduced to the minimum. In this way, controlling is helpful in achieving the goals.

ii. Judging Accuracy of Standards: While performing the function of controlling, a manager compares the actual work performance with the standards. He tries to find out whether the laid down standards are not more or less than the general standards. In case of need, they are redefined.

iii. Making Efficient Use of Resources: Controlling makes it possible to use human and physical resources efficiently. Under controlling, it is ensured that no employee deliberately delays his work performance. In the same way, wastage in all the physical resources is checked.

iv. Improving Employee Motivation: Through the medium of controlling, an effort is made to motivate the employees. The implementation of controlling makes all the employees to work with complete dedication because they know that their work performance will be evaluated and if the progress report is satisfactory, they will have their identity in the organisation.

v. Ensuring Order and Discipline: Controlling ensures order and discipline. With its implementation, all the undesirable activities like theft, corruption, delay in work and uncooperative attitude are checked. As a result, discipline is established in the organisation.

Correct option is (D) Both (A) and (C)

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.

According to Philip Kotler, “Control is the process of taking steps to bring actual results and desired results closer together.”

Deviation refers to the difference between actual performance and standard work.

'Critical Point Control' means focusing on key result areas which are critical to the success of an organisation.

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

Steps in Controlling Process:

(i) Setting Performance Standards: The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Standards can be set in both quantitative as well as qualitative terms. For instance, standards set in terms of cost to be incurred/ revenue to be earned, product units to be produced and sold, time to be spent in performing a task, all represents quantitative standards. Sometimes standards may also be set in qualitative terms. Improving goodwill and motivation level of employees are examples of qualitative standards.

(ii) Measurement of Actual Performance: Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner. There are several techniques for measurement of performance. These include personal observation, sample checking, performance reports, etc. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier.

(iii) Comparing Actual Performance with Standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms. For instance, performance of a worker in terms of units produced in a week can be easily measured against the standard output for the week.

(iv) Analyzing Deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Also, deviations in key areas of business need to be attended more urgently as compared to deviations in certain insignificant areas. Critical point control and management by exception should be used by a manager in this regard.

(v) Taking Corrective Action: The final step in the controlling process is taking corrective action. No corrective action is required when the deviations are within acceptable limits. 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.

Steps in Controlling Process:

(i) Setting Performance Standards: The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Standards can be set in both quantitative as well as qualitative terms. For instance, standards set in terms of cost to be incurred/ revenue to be earned, product units to be produced and sold, time to be spent in performing a task, all represents quantitative standards. Sometimes standards may also be set in qualitative terms. Improving goodwill and motivation level of employees are examples of qualitative standards.

(ii) Measurement of Actual Performance: Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner. There are several techniques for measurement of performance. These include personal observation, sample checking, performance reports, etc. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier.

(iii) Comparing Actual Performance with Standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms. For instance, performance of a worker in terms of units produced in a week can be easily measured against the standard output for the week.

(iv) Analyzing Deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Also, deviations in key areas of business need to be attended more urgently as compared to deviations in certain insignificant areas. Critical point control and management by exception should be used by a manager in this regard.

(v) Taking Corrective Action: The final step in the controlling process is taking corrective action. No corrective action is required when the deviations are within acceptable limits. 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.

Steps in Controlling Process:

(i) Setting Performance Standards: The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Standards can be set in both quantitative as well as qualitative terms. For instance, standards set in terms of cost to be incurred/ revenue to be earned, product units to be produced and sold, time to be spent in performing a task, all represents quantitative standards. Sometimes standards may also be set in qualitative terms. Improving goodwill and motivation level of employees are examples of qualitative standards.

(ii) Measurement of Actual Performance: Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner. There are several techniques for measurement of performance. These include personal observation, sample checking, performance reports, etc. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier.

(iii) Comparing Actual Performance with Standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms. For instance, performance of a worker in terms of units produced in a week can be easily measured against the standard output for the week.

(iv) Analyzing Deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Also, deviations in key areas of business need to be attended more urgently as compared to deviations in certain insignificant areas. Critical point control and management by exception should be used by a manager in this regard.

(v) Taking Corrective Action: The final step in the controlling process is taking corrective action. No corrective action is required when the deviations are within acceptable limits. 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.

Steps in Controlling Process:

(i) Setting Performance Standards: The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Standards can be set in both quantitative as well as qualitative terms. For instance, standards set in terms of cost to be incurred/ revenue to be earned, product units to be produced and sold, time to be spent in performing a task, all represents quantitative standards. Sometimes standards may also be set in qualitative terms. Improving goodwill and motivation level of employees are examples of qualitative standards.

(ii) Measurement of Actual Performance: Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner. There are several techniques for measurement of performance. These include personal observation, sample checking, performance reports, etc. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier.

(iii) Comparing Actual Performance with Standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms. For instance, performance of a worker in terms of units produced in a week can be easily measured against the standard output for the week.

(iv) Analyzing Deviations: Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Also, deviations in key areas of business need to be attended more urgently as compared to deviations in certain insignificant areas. Critical point control and management by exception should be used by a manager in this regard.

(v) Taking Corrective Action: The final step in the controlling process is taking corrective action. No corrective action is required when the deviations are within acceptable limits. 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.

Planning and controlling are mutually interrelated and inter-dependent activities because:

1. Controlling is based on planning: Planning provides standards used in controlling to compare with actual performance.

2. Planning without controlling is meaningless: Controlling ensures that commitments under the plans are fulfilled and events confirm the plans.

3. Planning is prescriptive and controlling is evaluative: Planning prescribes the most appropriate course of action for achieving objectives while controlling evaluates whether decisions have been translated into desired actions.

4. Both are forward looking: Planning is looking ahead as it is based on forecast about future and prepared for future only. Controlling aims also to improve future performance, if found any deviations.

5. Both are looking back: Controlling is looking back as it measures and compares actual performance with standards fixed in the past. Planning is also a backward looking function as plans are guided by the past experiences.

The Class 12 Business Studies MCQ Questions of Controlling with Answers are provided for the students to help them score better marks in the examination. By following and practicing these important MCQ Questions for class 12, Students will already master the important topics for their Class 12 board examinations. The MCQ Questions of Controlling set of business studies consists of all the chapter-wise important questions which give them a proper guide of how to make the preparation properly.

You can learn different ways of questions for each chapter from this MCQ of Business Studies Class 12 with Answers along with a detailed explanation to grasp the concept behind it. With the help of our provided Class 12 Business Studies MCQ Questions, you can answer any type of questions in the final exams and competitive exams. Practice Class 12 MCQ Questions for Business Studies Controlling with Answers to improve score high in exams.

1. Controlling function finds out how far __________ deviates from standards.

(a) Actual performance
(b) Improvement
(c) Corrective actions
(d) Cost

2. Which of the following is not a limitation of controlling?

(a) Little control on external factors
(b) Costly affair
(c) Ensuring order & discipline
(d) Difficulty in setting quantitative standards

3. “Planning is theoretical whereas controlling is practical”

(a) True
(b) False
(c) Cannot say

4. Which of the following is not a process of controlling?

(a) Analyzing deviations
(b) Integrates employees efforts
(c) Taking corrective measures
(d) Setting performance standards

5. Which of the following is a traditional technique of managerial control?

(a) Personal observation
(b) Breakeven analysis
(c) Budgetary control
(d) All of the above

6. Write the full form of PERT :-

(a) Performance evaluation report technique
(b) Personnel enquiry retrieving technique
(c) Programme evaluation and review technique

7. Remedial actions taken to prevent deviation in future is called

(a) Measurement of actual performance
(b) Taking corrective actions
(c) Analyzing deviations
(d) Setting performance standards

8. Assembling of facilities and personnel for collecting, processing, information that is required by managers is called

(a) PERT
(b) CPM
(c) Ratio analysis
(d) Management information Technique

9. Which of the following is not a technique of controlling?

(i) Break-even analysis
(ii) Budget
(iii) Managerial Audit
(iv) Cash Flow Statement

10. Budgetary control requires the preparation of

(i) Training schedule
(ii) Budgets
(iii) Network diagram
(iv) Responsibility centres

11. Controlling is

(i) Forward looking
(ii) Backward looking
(iii) contineous process
(iv) All of these

12. It is the process of ensuring that events confirm to plans.

(i) Planning
(ii) Controlling
(iii) Organising
(iv) Directing

13. What will be the corrective action for defective material?

(i) Change in Quantity
(ii) Change in Price
(iii) Change in Quality Specifications for the material used
(iv) None of the above

14. Which of the following is not an importance of controlling function?

(a) It ensures order and discipline.
(b) It restricts co-ordination in action.
(c) It helps in judging accuracy of standards.
(d) It improves employee motivation.

15. Which of the following statements does not highlight the relationship between planning and controlling?

(a) Planning and controlling are separable twins of management.
(b) Planning without controlling is meaningless, controlling without planning is blind.
(c) Planning is prescriptive, controlling is evaluative.
(d) Planning and controlling are interrelated and interdependent.

16. Om Prakash has set up a small business unit for the manufacturing of detergent. In order to market the detergent in the local residential areas, he has appointed a team of ten salesmen. Each salesman is expected to sell at least 200 units of the detergent within a week’s time. Identify the point of importance of controlling being highlighted in the above case.

(a) Controlling helps in judging accuracy of standards.
(b) It ensures efficient use of resources.
(c) It helps in improving employee motivation.
(d) It facilitates co-ordination in action.

17. It is the process of ensuring that events confirm to plans.

(a) Planning
(b) Controlling
(c) Organising
(d) Directing

18. The controlling function is performed by

(a) Top level management
(b) Lower level management
(c) Middle level management
(d) All of the above

19. Controlling function brings the management cycle back to the

(a) Organising function
(b) Directing function
(c) Planning function
(d) None of the above

20. It’s the process of making sure that things go as planned.

(a) Planning

(b) Controlling

(c) Planning

(d) Directing

21. Which of the following is not a necessary feature of the controlling?

(a) It maintains order and discipline

(b) It prevents action coordination.

(c) It aids in the evaluation of standard accuracy.

(d) It boosts worker motivation.

22. The function of controlling is performed by-

(a) Senior management

(b) Management at the lower levels

(c) Management at the middle level

(d) All of the above

23. The controlling function returns the management cycle to the

(a) organising

(b) directing

(c) planning

(d) none of the above functions.

24. When deviations are good in nature, they are referred to as deviations-

(a) Expected performance exceeds actual performance

(b) Expected performance exceeds actual performance

(c) Both expected and actual performances are the same

(d) None of the above

25. Which of the following claims about the controlling function is correct?

(a)  It is a function that looks ahead.

(b)  Is a function that looks backward.

(c)  Both (a) and (b)

(d) None of the above

Answer :

1. Answer (a) Actual performance

2. Answer (c) Ensuring order & discipline

3. Answer (a) True

4. Answer (b) Integrates employees efforts

5. Answer (d) All of the above

6. Answer  (c) Programme evaluation and review technique

7. Answer (b) Taking corrective actions

8. Answer (d) Management information Technique

9. Answer (iv) Cash Flow Statement

10. Answer (ii) Budgets

11. Answer (iv) All of these

12. Answer (ii) Controlling

13. Answer (iii) Change in Quality Specifications for the material used

14. Answer (b) It restricts co-ordination in action.

Explanation: (b) It facilitates co-ordination in action

15. Answer (a) Planning and controlling are separable twins of management.

Explanation: (a) Planning and controlling are inseparable twins

16. Answer (c) It helps in improving employee motivation.

Explanation: (c) By making employees aware of the expected performance

17. Answer (b) Controlling

18. Answer (d) All of the above

19. Answer (c) Planning function

20. Answer (b) Controlling

21. Answer (b) It prevents action coordination.

22. Answer (d) All of the above

23. Answer (c) planning

24. Answer (b) Expected performance exceeds actual performance

25. Answer (c)  Both (a) and (b)

(b) Standards

i. Increase in the morale of the employees

ii. Improving the quality of production.

This makes measurement of performances and their comparison with standard, a difficult task

Management control.

According to Peter F. Drucker, “Controlling is to maintain a balance between efforts and results and between resources and objectives.”

To see that errors, wastage and losses which occurred in the past are not repeated or take place in controlled manner.

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.

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.

Personal observation, sample checking, performance reports.

Critical point control.

1. It is controlling.

2. Following are the steps of controlling process:

i. Setting Performance Standards: The first step of controlling is to set performance standards. A manager evaluates the actual performance on the basis of these standards and finds out the deviations.

ii. Measurement of Actual Performance: The second step in the controlling process is the measurement of actual performance. The measurement of actual performance tells the manager whether the work has been done according to the plan or not.

iii. Comparison of Actual Performance with Standards: At this step, actual performance is compared with the standards and deviations are found out.

iv. Analysing Deviations: At this stage, deviations are analysed.