CHAPTER

8 Controlling

CHAPTER AT A GLANCE
Features of Controlling
CONTROLLING It is a goal-oriented function.
. It is a pervasive
function as it is
used in the
organisations of vary1ng types and sizes
Controlling Definition I t is considered to be a forward looking function
that activities as helps to improve the planning by providino
it
Controlling means ensuring valuable feedback tor reviewing and revisine
in an organisation are performed as per
the standards.
the plans.
It is considered to be a backward looking
function as it is like the post mortem of the
Importance of Controlling past activities to ascertain the deviations if anv
.It is not the last function ot management as
It helps in accomplishing organisational
it brings the management cycle back to the
goals by constanty monitoring the planning function.
performance of the employees and
bringing to light the deviations, if
any, and taking appropriate corrective Steps Involved in the Controlling Process
action. Setting performance standards in clear, speciic
I t helps the business managers to judge and measurable terms.
the objectivity and accuracy of the Measurement of actual performance as far as
standards. in the same units in which standards
possible
I t seeks to make efficient use of resources. are set.
with standards
I t seeks to motivate the employees and Comparing actual performance
to identify deviations if any.
helps them in giving a better performance. Analysing deviations through critical point
I t creates an atmosphere of order and control and management by exception approaches
discipline in the organisation. to identify the causes for their occurrence
the deviation
I t facilitates coordination in action by Taking corrective action whenever
limits so that
it
Occurs beyond the permissible
providing direction to all activities does not reoccur in future.
within and among departments.

216 Case Studies Mentor in BusinessStudies-XI

 Accomplishing Goal-oriented function
organisational goals
Pervasive function
Judging accuracy
of standards >Performed by the managers at all levels
I t brings back the management cycle to
Making efficient use
planning function
of resources

Improving employee
motivation

Ensures order and

discipline
Importance Relationship between planningg
and controlling
Facilitating coordination
in action They are inseparable twins.
Planning without controlling is
meaningless
Process Controlling is the process of
ensuring that events conform Controlling without planning is blind
to plans. Planning is prescriptive controlling is
evaluative
.Planning and controlling are both
forward and backward looking
functions

Measurement of actual Comparison of actual .Planning and controlling are

interrelated and reinforce each other
Setting performance performances performance with standards
standards

(feedback)
Analysing deviation
Taking corrective action Critical Point control
(if needed) Management by exception

*Not to be examined in 2021 Examination.

 PREFACE TO MNEMONICS
Kabir is he to help in memorising and easy necalling ot the points relatod
ed
onepts by telling about his deeds. key
Hapey Learning!!!!

Concept 1: Features of Controlling

Put =Pervasive function

Fifa Forward looking function
Games Goal-oriented function
In Is not the last function of
management
Box Backward looking function

Concept 2 Importance of Controling

Join Judge the objectivity and accuracy

of the standards
Martial Motivate the employees
Art Accomplishing organisational goals
Class Creates an atmosphere of order and discipline
For Facilitating coordination in action
Evening Efficient use of resources

Concept 3: Controlling Process

Saw Setting performance standards

My Measurement of actual performance
Aunt's Analysing deviations
Car omparing actual performance with standards
loday laking corrective action

218 Case Studies Mentor in Business Studies-Xll

 OBJECTIVE TYPE QUESTIONS
Board Questions
1 Previous Year's CBSE
roject at AMB consultants is running behind schedule by month. This
A n i m p o r t a r

heir
the
clients and might affect the reputation of the company in the long run.
has upsef

N o m
nagerial action like ass1gning more workers, equipment or giving overtime na
a n a

solve the problem. What managerial action may now be taken by the company
to solv
able
been
such a
situat from arising in the future?
void
the schedule
Revise
a)
(b) Assigning addition onal workers and equipment to the project
mission for furth overtime work
Get
(c)
Both () and (c) (CBSE Sample Paper 2019)
(d)
Multiple Choice Questions
Additional
is the process of ensuring that
Controllingconfirm to plans (6) Plans confirm to events
a Events
Both (a) and (b) (d) None of the above
)
2. In
an company the
controlling function is performed by
executive officer (b) Supervisor
a) Chief
c) Marketing manager ) All of the above
out
Name the function
that provides standards which are indispensable for carrying
controlling.
(a) Organising function (b) Directing function
(o) Planning function (a) None of the above

4. Deviations are said to be negative in nature when

(a) Planned performance is more than the actual performance
(6) Actual performance is more than the planned performance
) Both planned and actual performance are same
(d) None of the above
5. Which of the following is not an importance of controlling function?
(a) Facilitating coordination in action () It ensures order and discipline
) It restricts coordination in action (d) Ensures efficient use of resources
6 Which of the following statement is not true with respect to controlling function?
a) It is not a forward looking function (b) Is not a backward looking function
(c) Both (a) and (b) () None of the above
7. Identify the correct sequence of the steps involved in the controlling process.

( Setting performance standards, Measurement of actual performance, Comparison of

actual performance with standards, Analysing deviations, Taking corrective action
(b) Comparison of actual performance with standards, Setting performance standards,
Measurement of actual performance, Analysing deviations, Taking corrective action
C) Measurement of actual performance, Taking corrective action, Setting performance
standards, Comparison of actual performance with standards, Analysing deviations
) corrective action, Measurement of actual performance, Comparison of actual
Taking
performance with standards, Analysing deviations, Setting performance standards

Controlling 219
 used tor measuring actual pertormance?
actual performa
following is a technique (b) Personal observation
8. Which of the
(a) Random sampling (d) All of the above
(c) Pertormance neports ace beco.
planned performance
9. The comparison
of actual performance
with the
becomes easier i
set in
the standards are (b) Quantitative terms
(a) Qualitative terms
(d) None of the above
above
)Either of the
is based on the belief that if you
ou trtry to
control management
10.This concept of end up controlling nothing.
control
everything vou may (b) Key result areas
control
(a) Critical point (d) Deviations
(c) Management by exception
between the actual performance and the planned perfoTma.
11. When the deviations Te
within the limits
action is required b) No corrective action is required
(a) A limited corrective
(d) None of the above
c) A major corrective action required
is
the standard output set for a worker is 7 tunit. nits
12. In a shoe making manufacturing unit
In the given case the value of deviation i
dav. Dinesh produces 5 units in one day.
(b)+2 c) 12 (d) None of the above
(a)-2
controlling function is felt in
13. The need for the
(a) Business organisations (b) Political organisations
() Social organisations
d) All of the above
14. Sugandha Limited is small scale business unit manufacturing incenses. The standard
a worker engaged in packaging of
incenses cones is 100 units in one day. But
output for
it is noticed that all the workers are able to pertorm at a much higher level as compared
to the standard set. Therefore, the supervisor decided to revise the standards. Identify the
of
point 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 coordination in action
15. Reducing the workers absenteeism in a factory by 10% is an example of
(a) Quantitative standard (b) Qualitative standard
(c) Deviation (d) None of the above
16. Yash runs a logistic company. The tour incharges of each trip in the company are expected
to submit a report to the event manager on the completion of every trip. Identify the step
in the controlling process being described in the above lines.
(a) Setting of standards (b) Measurement of actual performance
) Taking corrective action (d) Analysing the deviations
17. In a marketing firm, the financial manager pays more attention towards an increase
in the dentify
3o marketing
cost as compared to a 15% increase in the courier
the concept being used by the
expenses.
manager.
(a) Management by exception () Critical point control
(c) Corrective action (d) None of the above
18. In order to ensure that the classroom
teaching is effective, Mrs. Anju
herself. the
of Golden Public School carries out classroom teaching observationsKapoor, Tdenu) he

220 Case Studies Mentor in Business Studies-XII

 step involved
nd in the controlling process being described
of standards in the above lines.
Setting 6)
a) Taking correctiv action Measurement of actual performance
(d) Analysing the deviations
blanks
the
Fillin
. 1. is the process of
ensuring that
***** ....
...

events confirm
tag function brings back the
to
plans.
management cycle
2 Controlli

function.
back to the
of IS
concept
. . .

. .
based on the belief that, if
3.The control everytng
you m a y
end up ntrolling nothing. you try to

4. Control
is not a one time
activity. This statement
, *'''****°**** process. highlights that contro
ntrolling is a

is
* * * ' ' ' *

pre-requisite for
controlling.
the controlling process, the
deviation between actual and desired results is revealed in
thestep....
7.When the deviations g0 beyond the acceptable range
... action is required.
State whether true or talse. (Give reason in
support of your answer).
he controlling function is pertformed only by Top level
Deviations are said to be pOsitive in nature when the planned performance is less than
management.
the actual performance.
3. Planning without controlling is
meaningless, controlling without planning is blind.
4. Controlling function is not a forward looking function.
5. Performance reports is technique
used for measuring actual
a
performance.
6. The comparison of actual performance with the planned performance becomes easier if
the standards are set in qualitative terms.
7. When the
deviations between the actual performance and the
within the limits,
a limited corrective action is
planned performance are

required.
8. The need for the
controlling function is felt only in the business organisations.
9. In the
controlling process, forcomparing actual
performance with standards certain units
are checked at random for quality sample checking.
as
10.
According to the concept of 'Management by Exception' controlling activities within an
organization should focus on key result areas (KRAs) which are critical to its success.
V. Match the
following by choosing the correct option.
Column A Column B
) Postmortem of
past activities (a) Quantitative standards
(i) Looking ahead (b) Qualitative standards
ii) Production cost ()Planning8
per unit
io) Improving goodwill (d) Controlling
ac) 0a); (i)-b); (ii)-(c); (iv)-{d) (b) ()-(b); (i)-(a); (ii)-(d); (iv)-(¢)
(-(o); (i)-Hd); (ii)-a); (iv)-(6) (d) i-d); (in)-(¢); (in)-(a); (v)>l6)
Controlling 221
 Column A Column B
() Critical point control
) Sample checking
(b) Taking corrective
(i) Focus on key result areas
action
(c) Measurement of
(ii) An attempt to control everything
performance
Actual
results in controlling nothing
(iv) Permission for overtime work
(d) Management by Exception
(a) ()-a); (in-(b); (ii)--c); (iv)-4d)
b) (0-b): Gi)-o); (in-d;(io)-tH
d) -4); (n-©; (i)-(b); (iv)-(a)
(c) OHc). ()-a): (ui)-4d); (pHb)
Column B
3. Column A
(a) Alteration the quality
() Faulty machinery specification
(6) Deputing additional workers
Production target not achieved
(i)
(ii) Substandard material (c) Repair or replace the
machinery
schedule (4) Training of workers
(iv) Project is running behind
(b) (-c); (ii-td); (ii)-ta); (iv)-(b)
(a) (i-a); (i-(b); (im)-4c); (iv)-4)
(d) ()-d); (i)-c); (ii)-(6); (iv)-(a)
(c) (9-c); (i)Ad); (ii)-6); (iv)-{a)
Column B
Column A
(a) Pervasive function
(9 Prescriptive
(b) Judging accuracy of standards
(i) Evaluative
(i) Feature of controlling (c) Planning
(io) Importance of controlling () Controlling
(a) (iHc); (iHd): (iüi-ta); (iv-b) (b) ()-(6); (irn-a); (i)-td); (iv)-(c)
(d) (9-d); (i)-¢); (in)-D); (iv)-(a)
c-c;: (i)-ta); (ii)-d); (iv-b)
ANSWERS
I. Previous Year's CBSE Board Questions
the company to avoid
1. () Revise the schedule is managerial action may
now be taken by
such a situation from arising in the future.

II. Additional Multiple Choice Questions

1. (a) 2. (d) 3.(C) 4. (0) 5. () (It facilitates coordination in action)
10. (c) 11. (b) 12. (0) 13. (d)
6.(C) 7.(a 8. (d) 9.(b)
14. (a) 15. () 16. (b) 17. (b) 18. (b)
IIL Fill in the blanks
1. Controlling 2. Planning
3. Management by ex.ception 4. Continuous/on going
5. Planning 6. Comparing Actual Performance with Standards

7. Corrective

222 Case Studles Mentor in Business Studiles-XIl

 T u e o rl a l s e

the
levels) 2. True 3. True
(all 4. False 5. True
False Quantitative terms)
6 False( Q
la corrective action is required)

of organisations)
F a l s e

se (all types ofactual

& ( M e a s u r e m e n t

performance)
Point Control
False

(Critical

False
the following
Match

2. (c) 3. (b) 4. (a)

LATEST CBSE QUESTIONS

QUESTION 1:
cloth merchant
in Karol Bagh. His
grandsons are requesting him to let
but on the condition that them
B a n w a r i

diversify the. iness into bridal wear. Banwari Lal has agreed they
divew the function management he has always followed, which helps an
of
organisation
W ing track of the progress of activities and ensures that the activities conform to the
andards set in advance so that the organisational goals are achieved. Name the function
fmanagemer
ement which Banwari Lal is asking his grandsons to follow. List any two reasons

why
s considered an indispensable function of management.
ANSWER:

Controlling is the function of management which Banwari Lal is asking his grandsons
o fllow. The two reasons for controlling being considered an indispensable function of
management are as follows:
() Accomplishing organisational goals: The controlling function facilitates constant
monitoring of the actual performance in comparison to the predetermined standards.
It brings to light the deviations, if anyj and indicates corrective action.
) Improving employee motivation: An effective control system motivates the employees
by informing them well in advance about (a) the level of performance expected from
them and (b) what are the standards of performance on the basis of which their
performance will be evaluated.

QUESTION 2:
IaS was the Chief Operating Officer of "Yalet Ltd." as company providing advanced
S0rware solutions to indian defence services. They had been carrying on business successfully
the last twelve years and earning enough profits. But from the last one year, they realized
hough the business is getting big orders, which are being fulfilled in times, even then
t u e s kept on decreasing. Vikas was not able to find out where the problem was. He
Naeping a close check on the progress of activities as he could sense that something
Was
l e wanted to take some action before any major damage could be done to the
ndf a s appointed a Cyber Security Expert who monitored the company's processes
found out that ththe computer operator was deleting the entries from the computer and

Controlling 223
 to the Police. This
pocketing the revenues. He was caught and handed over

discipline in the organization

and helped in minimiCreata
atmosphere of order and
behaviour on the part of the employees.
(a) Identify the function of Management highlighted in the above paragraph
ishones
n.
(b) Explain any four other ways in which this function of management
gement may help
organization. (CBSE, OD 2019)e
ANSWER:
(a) Controlling is the function of management highlighted in the above Dar
managerial function of controlling refers to the process of ensuring that thPh ha
in an organisation are performed as per the plans. ties
(b) The four ways in which controlling function of management may help the
the rorganization
are described below:
) Accomplishing organisational goals: The controlling function facilitates
tes co
monitoring of the actual performance in comparison to the predetsant
standards. It brings to light the deviations, if any, and indicates correctiuned
Thus, controlling function helps to maintain a track of the work in nroCon
order to ensure that the activities conform to the predetermined standards
as
to achieve the desired goals.
(n Judging acuracy of standards: A good control system enables manageme
to
validate whether the standards set correct and objective. Moreover, it
are
to review and revise the standards in light of changes taking place with inhelps
the
the
organisation or business environment in gerneral.
(in) Making efficient use of resources: By implementing a good control system
a
manager is able to curb the wastage and spoilage of resources. This is because
each action is performed in accordance with fixed standards and norms rather than
hit and trial method. This ensures that resources are used in the most effective and
efficient manner.
(io) Improving employee motivation: An effective control system seeks to provide
motivation to the employees as they are made aware well in advance (a) about
the level of performance expected from them and (6) what are the standards of
performance on the basis of which their performance will be evaluated. This
approach inspires them to give higher performance.

QUESTION3:
Vinber Ltd. set up a manufacturing unit at Bhiwadi in Himachal Pradesh to manufacture
electric geysers and supply them to dealers all over the country. Their production target was
500 geysers per week. It was decided by the management that variation in production upo
10 units be acceptable.
At the end of the fist week, the production was 450 geysers. The next week, productio
increased to 470 geysers. A week later, production was 460 geysers. On investigation, 1t

found that fluctuation in production was due to irregular supply of electricity.

(a) The above para discusses some of the steps in the process of one of the functio
management. Explain these steps.
(6) Also, state the step(s) that have not been discussed in the above para.
(CBSE, Delhi, 2019)

224 Case Studies Mentor in Business Studies-XIl

ANSWER:
ious steps involved in the
process of
performance standards: The first controlling
are described below:
Setting step in the controlling process involves
standards in clear, specific and
measurable terms. Standards can be set
quantitative as well
qualitative.
as
It is important that
ible enough
flexible enough toi
to be modified with the changes taking placestandards shoulaand
in the internal
oxternal business environment.
mparison of actual pertormance with standards: This step involves comparison
(i) Comparison

of actual performance with the standard. Such comparison will reveal the
ac

and noting viations if any. If the actual deviatior

is more than planned
erformance viations are said to be
devia performance
P e r

positive or vice-versa.
(in) Analysing ations: Once the deviations are identified it is aportant to analyse
them through:
m Critical pointcontrol: All the
deviations may not be significant.
may not be either economical nor easy to monitor each and
Moreover
every activity in
ne
organisation. Iherefore, 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.
(1) Management by exception: Management by exception is the principle of
management control which is based on the belief that if you try to control
everythin8 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.
() ()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.
(i) 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
new machinery, increasing supervision and so on.
trainingof employees, buying
QUESTION 4:
Mahima Jain is the Senior Manager in the Advisory Services Department of Kodes Ltd. She
glarly prepares performance reports of her subordinates as a part of the appraisal.
her. (CBSE, OD, 2019)
APntity the step of the controlling process performed by
ANSWER:
of actual performance is the step of controlling process being performed by
rement
her.
Controlling 225
 QUESTION 5:
urth quarter ended
Textile manufacturer Super textiles reported 43% fall in its profits in the fourth oa
25% decided by the compar
31 March 2017, which is beyond the acceptable range
of demonetization. The cohis
due to higher fuel cost and lower yield on account
to implement cost saving measures by restructuring contracts and its busin
usiness mpany
processesaims
meet its targets in the future. to
above.
(a) Name the function of management discussed
(b) Also identify and explain the steps of the funchon of management discussed
ed above.
(CBSE, Sample Paper,
2018)
ANSWER:
(a) Controlling is the function of management discussed above.
(6) The steps of controlling process discussed above are stated below:
Analysing deviations: Once the deviationsare identiñed it is important to analu
them through:
1. Critical point control: All the deviations may not be significant. Moreor
may not be either economical nor easy to monitor each and every activihr
n the
organisation. Therefore, every organisation identifies and states its speci
ke
result areas (KRAs) or critical points which require tight control are likel
have a significant effect on the working of the business. Any deviations on tho
points are attended to urgently by the management. Like if the expenditure thesen
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.
2. 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.
(i) Taking corrective action: This is the final step involved in the controlling proces
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 6:
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 describea.

226Case Studies Mentor in Business Studies-Xl

oUESTIONz

(anythinggoes with the performance of key activities, the entire organisation suffers.
wro

hingorganisation shoula focus on them.' Explain the statement with aa suitable

Theretore
erample (CBSE, Sample Paper 2015-16)
ANSWER:
n statement
ment refers to the importance of 'Critical Point Control' in order to ensure
efectivep e r t o r m a n c e
T h e
g i v e n

key activities in an

ve P nt Control: It may not be either organisation.

economical nor easy to monitor each and every
Criticuh organisation. iheretore, every organisation identifies
t yi n
and states its specific
Areas (KRAs) or critical points which require tight control and re likely to
KeyK e s u l t A r e ;

a s i
iicant effect on the working of the business. Any deviations on these points are
g n i f i c a n t

by the management. For example, if in an organisation, the

on stationery goe:
oes up by 100, it can be ignored but if the production cost goesexpenditure
up by 5%,
managerial action.
may
call for
it
QUESTION 8:

Nath, a
recently appointed production manager of Suntech Ltd., has decided to produce
recentl

Mt
gs instead of plastic bags as these are banned by the government. He set a target or
jute 1000 jute bags a day. It was reported that the employees were not able to achieve
produ After analysis, he found that employees were demotivated and not putting in
he t
t h e ib
r est
for achieving the target. Mr. Nath's behaviour is good towards the employees. His
ive.
is always positive So, he announced various incentive schemes for the employees
tude
Ike:
nstalling awards or certificates for best performance
Rewarding an employee for giving valuable suggestions
,Congratulating the employees for good performance
Identify the functions of management highlighted in the above paragraph.

6) State the incentive under which the employee are otivated.

) State any two values which the production manager wants to communicate to society
by his work and behaviour. (CBSE, Sample Paper 2015)

ANSWER:
(a) The functions of management highlighted in the above paragraph are Controlling and
Directing.
(0) 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.
() The two values that the manager wants to communicate to the society through his
work and behaviour are:
Respect 0) for employees (i) Concern for environment

QUESTION 9:
It
pany was manufacturing LED bulbs which were in great demand. was found that
the ta On analysis, it was
get of producing 300 bulbs a day was not met by the employees.
a t the workers were not at fault. Due to electricity failure and shortage of workers,

Controlling 227
ne
company was not able to achieve
the set targets and
ternative arrangemente
alternative
needed.
assessed that approximat. wete
lo meet the increased demand, the company
workers were required out of
which 8 would work
heads of diff as

ifferent 8898departadditiona
ment
reauireslaxatalifiicoatnsionsshoaunldd ibhe
and 10 would work as subordinates under each head. The required

also enlisted. It was also decided that nece

Speciications were

to encourage women, people from

backward and rural areas and Dea
8iven efforts Wer with.
ilibes to assume responsible positions in
abi
the organisations. All Nere made to
with the nature of work.
the of
ability the applicants
discussed above.
match
(a) ldentify the functions of management
discussed in the
(6) State the two steps in the process of each function discussed the aho.
above par
two values which the company wants to communicate to the Graph.
(c) List any
society.
so.

(CBSE, Delhi 2015

ANSWER:
(a) The functions of management discussed above are staftfing and Controllina

as follows:
g
(6) The two steps involved in staffing function are
() Estimating manpower requirements: The manpower requirements of an oros
are estimated through workload analysis and worktorce analysis. The
analysis helps to determine the number and type of human resource ronoadworkl
n
the organisation to meet its present and future needs. Whereas workforc
seeks to determine the number and type of human resource available withi
he
organisation.
() Recruitment: The process of recruitment involves searching for the prospect
candidates and stimulating them to apply for jobs in the organisation. There aare
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 ifany
"It was found that the target of producing 300 bulbs a day was not met by the
employees."
(i) 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 targes
and alternative arrangements were needed."
(ii) Taking corrective action, if required "To meet the increased demand, the company
assessed that approximately..as subordinate under each head."
(c) The two values that the company wants to communicate to the society are
(i) Women empowerment
(i) Kindness.

QUESTION 10:
'AS Ltd' is a large company engaged in assembling of air-conditioners. Recently the c o e
had conducted the "Time' and 'Motion' study and concluded that on an average, a

228 Case Studies Mentorin Business Studies-XIl

 air-conditioners in a
day. The
target volume of the company in day
ambleoo units air-conditioners. The company
1,000
of
ur
a

Jabour
bling
pertioned
of
turnover
is providing attractive
turnover and aabsenteeism. All the workers ve allowances
Even then the
b l i n go f a i r - c o n a

onditioners per day are

1s 800units happy.
only. To find out the reason, the
Semblh actual formance of each worker and
observed through cCTV that some company
or tne
nwere busy
mpared
orkers were b us in gossiping
the function of management discussed
l d e n t i f y

above.
1a)
(i)State the ps in the process of the
function identified which
above paragraph.
are discussed in
the
(CBSE, 2015)

ANSWER:

of managemení discussed above

is
Thefunction
Controlling.
eps involved in the process of controlling which are discussed in the above
t ) The
paragraph are:

() Setting standara ards of

performance: "concluded that on an average, a worker can
mble ten air-conditioners in a day." "The target volume of the company in a
day is assembling ot 1,000 units of air-conditioners."

h Measurement of actual performance: "Even then the assembling of air-conditioners

day is 800 units only."
per
in Comparison of act ual performance with the standards: The company compared actual
performance of the workers with the planned performance and noted deviation of
200 units.
i) 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 gossiping8"

QUESTION 11:
QR Ltd. is engaged in manufacturing machine components. The target production is 200o
units per day. The company had been successfully attaining this target until two months
2g0. Over the last two months, it has been observed that daily production varies between
150-170 units.
0) ldentify the management function to rectify the above situation.
(b) Briefly state the procedure to be followed so that the actual production may come up
to the target production. (CBSE, Delhi 2010)
ANSWER:
(a) The controlling function of management is needed to rectify the above situation.
(6) The procedure to be followed so that the actual production may come up with the
target production is as follows:
0) Providing training to workers if the workers äie 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.
Keplacing the machinery if it is defective or has become obsolete.

Controlling229
QUESTION 12:
unit. Recently the company hahad conduc.
conducte
Kapil &Co. is a large manufacturing ti
an average, a
worker could produce 300ed
300 uce
motion studies and concluded that on
daily production per worker unitspere dayand
However, it has been noticed that the average in the range
of 200-225 units
and identity the steps in the process o l .

(a) Name the function of management

actual production of a work this funct
in out that the
finding is less
which helped than the
set target.
and to ensure the
function identihed in (0) e
process of the
(6) To complete the
as per time and motion
studies, explain what further steps manager pertorman
has to
take?
tal
CBSE, 2010)
ANSWER:
which helped in finding out that
(a) Controlling is the function of management
than the set target.
the actua
performance of a worker is less
The steps involved in the controlling function ot management which helpedd in
out that the actual
worker is less than the set target are
performance of a
finding
outli
below:
in clear, specific and measurable terms
() Setting performance standards
motion studies and concluded
"Recenthy the company had conducted time and
thot.
on an

average, a worker could produce 300 units per day."

(i) Measurement of actual performance as far
as possible in the same units in whi
standards are set.
"It has been noticed that the average daily production per worker is in the "ange
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 Der
per
worker.
and to ensure the performance as per
(b) In order to complete the proess of controlling
time and motion studies the manager has to further take the following two steps
deviations critical point control and management by exception ap
through
() Analyzing
is a deviation in output in the range of
proach: In the given situation, there the reasons for the same. The
25-50 units per worker. The manager should analyse
possible reasons for the same are
are not well versed with the production process.
.The workers
The working environment is not conducive to efficient working.
not available on time.
The raw materials and other equipment are so
attention
corrective action: The deviations require immediate management
Takingthey
(i) that do not reoccur in future. Therefore, the manager should take appropriale

corrective action after analyzing the situation like providing

training to workers
of the raw
the work environment, and ensuring timely availability
improving
materials and other equipment.

QUESTION 13: ction

K&K Co. Ltd. is engaged in manufacturing of machine components. The target of prouh
1onths
is 200 units daily. The company had been successfully attaining this target until two n

230 Case Studies Mentor in Business Studies-XIl

 the
last two months it has been
last

observed that daily production varies betwee

Over

tdentify the possible causes for the

decline in teps to be
go
- 1 7 0 u n i t s .

the esire targets. production and the

ster
chieve (CBSE, 2008)
taken

ANSWER:
hle
Thepossible
causes for decline in
production are listed below:
are well versed with the
production process.
workers

The
a) The vorking environment is not conducive to efficient working.
()

Th
materials and other
equipment are not available on time.
he machinery is defective or has become obsolete.
( a )T h e

The deviriations require immediate management attention so that they do not reoccur in
erefore, the manager should take
e appropriate corrective action after analyzing the
future
Jation like providin
ling training to workers,
situati

1ability of the raw materials and other

improving the work environment, ensuring
i m e l ya v a i l a b i

equipment or replacing the machinery.

ADDITIONAL QUESTIONS
QUESTION 1:

company known for manufacturing good quality

Bauds Ltd.' is a

tem of confectionery products.

production ensures uniformity in production and
utomated syster
quality
l i t y assurance team conducts stringent checks at all stages, records and maintenance.
analyses the
atons and takes the necessary corrective actions right from the procurement of raw
aterial to its processing production and packaging. The company has a well-equipped in-
Lse quality inspection
house
cell where
confectionery products are tested on various parameters
of quality by the team of experienced quality staff.
In context of the above case:

(a) ldentify and explain the function of management being performed by the
assurance team of Taste Buds Ltd. quality
(6) Explain the statement, "records and analyses the deviations and takes the
corrective actions". necessary

ANSWER:
(a) Controlling is the function of
management being performed by the quality assurance
team of Taste Buds Ltd.'
Controlling is th oroeess of ensuring that events conform to plans.
6) The statement "reords and analyses the deviations and takes the
actions" refers to the following necessary corrective
steps involved in the of
(0) Comparing the actual
process controlling:
performance with the standards: The actual
compared with the standards and deviations, if any, are recorded. performance
is

(0) Analysing deviations: Once the deviations are identified, it is

them through: important to analyse
1. Critical point control: All the deviations
may not be significant. Moreover, it may
not be either economical nor to monitor each and every activity in the
easy

Controlling 231
 organisation identifies and states ts
organisation. Therefore, every which require tight control aeSPeci
result areas (KRAs) or critical points
working of
the usiness. Any
the busi they are likey
kely
to have asignificant effect on

these points are attended to urgently by

the the mas
management. Like in #H deviation
if the expenditure on
up by 10% it scan boveOn
refreshment of workers goes up
be case,

2.
but if the production cost goes up by

Management by exception: Management

5% it may call for mana
managerial igactnoredion
by exception is the principle of
which is basedthe belief
on
that if
you try to control. manage
only significant ever
ment control

you may end up controlling

nothing. Therefore,
limits should be brought to the
ything,
deviation
which go beyond the permissible notic of the
the above case, the output defects upto 2%
de
management. Like in
sidered acceptable but if it goes up by 5%, it may call for may be con-
managerial actior
last step in controlling Process involves takine co
(it) Taking corrective action: The ective
ocurs beyond the permissible limits so #R
action whenever the deviation
However, the standards may
in future.
be revised if it is not ne hey do
not reoccur
corrective action. to
check deviations through
QUESTION 2:
Anubhav has set up an export house after completing his masters in fashion desioni
the quality of raw material used, he assurec A s
the quality of the garment depends on
fabric meets the requirements by conductinga
series of tests for the fabrics like shrinka e
testing colour fastness to washing, colour fastness to light, colour fastness to persnirasetc
areas, tabric inspection is also conduc
through laboratory tests. Later on, at the production to detect the deviations and also tl
The tests help
by stopping the production process.
corrective action. Moreover, he ensures that complete training about production work w
as
worker at the time of his export house.
joining
given to every

In context of the above case:

(a) 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.
term 'deviations.'
(b) Briefly explain the
ANSWER:
(a) Controlling is the function of management being performed by Anubhav by conducting
to assure for the
tests of the garments manufactured in his export house.
quality
and
(b) The term 'deviations' refers to the difference between the actual performance
more than the planned performance,
planned performance. If the actual performance is
it may be said to be positive in nature or vice-versa.

QUESTION 3:
Raghav take away eating joint in a nearby market. His business was doing well.
started a
o
He ensured that the food was properly cooked, a standard taste was maintained, packing
food was done effectively and the orders were executed on time. But unfortunately he mer
with an accident and was advised three months bed rest. In his absence, his cousin kou
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 quany
A" this
food had deteriorated and the delivery time for orders had increased considerably.
was happening because most of his previous staff had left as Rohit used to adopt a e

strict and authoritative approach towards them.

232 Case Studies Mentor in Business Studies-XIl

 above case:
the
Incontext of
two
spects about his business that Raghav was controlling in order to make
any
List
itsuccessful.
)
iefly any two
in briefly points to
highlight the importance of the
Explain controlling
function.

func nd explain
the style of leadership adopted Rohit.
N N a m ea r
by
ANSWER: ects abou
two aspects about his business that Raghav was controlling in order to make it
a)The

are liste below:

ccessful

standard taste was maintained.

() A
order were executed on time.
The
m
()
The
two Doints that
points highlight the importance of the controlling function are liste
(6)
below

( accuracy of standards: The controlling function helps the business

Judging accuracy
iudge the objectivity and accuracy of the current standards. It also managers
assists in
to
reviewing and revising the standards keeping in view the forthcoming changes in
h the internal and external
environment of the business.
employee motivation: The controlling function seeks to motivate the
(i) Improving
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 pertormance are on the basis of which they will be judged.
Rohit had
had adop
adopted an autocratic style of leadership. An autocratic leader expects strict
() Rohit
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
nd pickles. It has tied up with the small farmers in various states for sourcing of fruits and
veetables. 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
ae brought to the attention of management. The degree of deviations allowed in different
ategories 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
20,000 or more in purchase costs will be reported to the concerned department manager.
In context of the above case:
(o) ldentify the principle of management control adopted by the company. State the belief
underlying this principle.
b) List any two values that the company wants to communicate to the society.

ANSWER:
o) 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.
) The two values that the company wants to communicate to the society are:
) Rural development (ii) Sense of responsibility

Controlling 233
 completing
a course
xtile desig
in textile, She
QUESTION 5: after

a small
scale factory
outlets in the city foror supplying h to
them
e
c u s h i o n s etc. Sho
retail
Shruti has
established

home
furnishing
like bed
covers, She believes good
that
with the big products an order,rder, she sets the
has tied up

quality designer
home
furnishing
blind. So, every
time she gets
in m.
r e q u i r e m e n t s in man-hours standadards
planning is
estimated
without the
controlling
number of personnel
required,
for the
projected
production a n d per
and the amount
of the materials
w o r k - l o a d . She also
in terms direct
requirements of projected a
product,
the at the
required #h
plans. Wheneve,
overhead expenses to
conform der size
the notice-board a
of normal that they
the activities so
as to ensure
notice on
a the factory
watch on
extra
workers by placing
she hires
is too large, available.
details of the jobs
specifying the
case:

In context of the above

being performed
by Shruti.
functions of management mention its tvne
the Shruti. Also,
(a) Tdentify recruitment adopted by
of
Name the
source
()
Controlling and S t .
a tafing,
Shruti are
being performed by
ANSWER:

functions of management Recruitment. It is an

(a) The
recruitment adopted by
Shruti is Direct external
of
(b) The source

source o f recruitment.

QUESTION is followed by McDonald

in the cooking and hand.
approach
A critical point control (CPC) threat can be prevented, eliminated, or reduced to an acceptakl
so that any
food safety undertaken to ensure that the procese
process of activities are
continuous monitoring
level. Hence, followed for cooking at McDonal
control. The main principle
critical point and high fresh level of the
is right at each
time" which can ensure the high quality
is "less amount many worker cannot cook all the four
have to be made, a
if four hamburgers
one hamburger is one hundred
food. For instance,
at one time. The
time figured out for making
hamburgers have the specific holding
Moreover, nearly all
foods in the McDonald
and forty-five seconds. french fries is seven minutes.
time for hamburgers is ten minutes and for
time, the holding the temperature of the milk sent by
sold within that time it is thrown away. Also,
If it is not
returned.
4° C, otherwise, it will be
the supplier must be under
In context of the above case:
the
which is being discussed in
(a) Name the steps involved in the controlling process
above lines.

(b) What do you understand by 'critical point control? Explain.

in accomplishing organisational
(c) How does the controlling function of management help
goals and ensure efficient use of resources?
ANSWER:
being discussed in the above
(a) Analysing deviation and taking corrective action are

lines.
it may neither be economical nor easy to monitor each and every activity
(b)Since
the organisation, therefore, every organisation identifies and states its speciic e a
result areas (KRAs) or critical points which require tight control are likely to na

234 Case Studies Mentor in Business Studies-XI

 efect on the working of the
t business. Any deviations on these poin
are
signific

attended
icanurgently by the management.
Doints
Thet w opoints that highlight the importance of the controlling function are listed below:

Accomplishing organisational goals: The controlling function helps in accomplishing

anisational goals by constantly monitoring the performance of the emplo
to light the
and bringing deviations, if any, and taking appropriate corrective
action.

Making efficient use of resources: The controlling function enables the manag
(i) to work as per predetermined standards. This helps to avoid any ambiguy
in business operations and reduce wastage and spoilage of resources im ue
organisation.

QUESTION7:

S h a g u n o W n s
export oriented unit in Faridabad. She in a typical inspection, picks up one
garment
garmen item and gets them measured at random, and all its dimensions
pieces per
orrecorded in a measurement table. This table shows each measurement for all sizes and
more

te whether or not particular dimensions are within tolerance. For example, one such
dimensid lude
might incluc "shoulder width from edge to edge" where in a small discrepancy o
allowed. Whereas a deviation up to 1/4" is allowed for "neck width from edge
all
o1/8"is
up easurement. She also ask the worker to put a garment on a model or dummy to
t oe d g e "
rrectly. Also for the aspects which are critical to the garment i.e. fasteners
fits corre
that it
check zippers a fatigue test is carried out by testing each of them 50 times to
ke buttons and

that there is
no loss of function after use.
e n s u r e

of the above case:

In context
ldentify the technique for measurement of performance being described in the
a)
paragraph above quoting lines from the paragraph.
(A)Identify the concepts related to the analysing deviation being used during inspection
lines from the paragraph.
by quoting
ANSWER:
() The technique for measurement of performance used above are stated below:
Sample checking: "She in a typical inspection, picks up one or more pieces per
garment item and gets them measured at random, and all its dimensions are recorded
in a measurement table."
(6) The concepts related to the analysing deviation being used during inspection are stated
below:
() Management by exception: "This table shows each measurement for all sizes
and will indicate whether or not particular dimensions are within tolerance. For
example, one such dimension might include "shoulder width from edge to edge"
where in a small discrepancy of up to 1/8" is allowed. Whereas a deviation up to
1/4" is allowed for "neck width from edge to edge" measurement."
(i) Critical point control: "Also for the aspects which are critical to the garment i.e.
fasteners like buttons and zippers a fatigue test is carried out by testing each of
them 50 times to ensure that there is no loss of fun tion after use.

Controlling 235