CBSE Class 12 Business Studies Controlling Important Questions

QUES 1:  Which function of management ensures that actual activities confirm to planed activities?

                                        OR

            Name the function which reviews the operations in a business unit.

Ans: Controlling

QUES 2: There are two managers rahim and pankaj. Rahim is saying that ‘controlling is forward looking’ whereas according to pankaj ‘controlling is looking back’ . Who is correct? Explain why.           

Ans:  Both managers rahim and pankaj are correct and explain controlling as forward looking and looking back.           

QUES 3: Employees know 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, which in turn help them to give better performance. Which importance of controlling is highlighted here?

Ans: Improves employees motivation.

QUES 4:  Which function of management ensures work accomplishment according to plQ? Name and explain the importance of the function.

Ans: Controlling is the function of management which ensures work accomplishment according to plans? And explain the importance of the controlling      

QUES 5: Controlling provides direction to all activities and efforts for achieving organizational goals. Which importance of controlling is referred here? Also explain two more of its importance.  

Ans: Facilitating coordination in action. Explain two more importance of controlling. 

QUES 6:  “There is close and reciprocal relationship between planning and controlling”. Explain the statement through an example.

Ans:  Yes, “there is close and reciprocal relationship between planning and controlling”. Without planning, there is no basis for controlling activities and without controlling planned activities cannot be implemented properly and there cannot be improvement in future plans.

QUES 7: Controlling is a systematic process involving a series of steps.

Ans:   Explain the process/steps of controlling.

QUES 8:  Name the concept which suggests that only significant deviations which go beyond the permissible limit should brought to the notice of management

Ans:  Management by exception.

QUES 9:   Which technique of control is concerned with the contribution of actual and planed expenditure.

Ans:  Budgetary control

QUES 10: “In ideal control system is the one that checks every bit of performance”.  Do you agree with this statement? Give reasons to support your answer.

Ans:  No, I do not  agree with this statement. Because a manager should focus on key points only and should not waste his energy in checking every bit.

QUES 11: Abc ltd. Is manufacturing auto spare parts on large scale. The company  policy is that 3% of the daily production could be defective. answer last two   months it is observed that about 10-12% of production is defective. Which function of management is reinsured to correct the above case? State the procedure to be followed to correct the things.

Ans:  The management function reinsured to correct the above case is controlling. The procedure to be followed is:

1)      Find out the causes of deviation of defective percentage from 3 to 12.

2)      Take corrective measure to control the things.

QUES 12: “Comparing the actual performance with the laid standards, finding out the deviations and taking corrective action is an important function of a function of management”. Name the function and explain the process.    

Ans:     Name of  the function is controlling and explain the process of controlling.

QUES 13:  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 equisized 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. 

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

QUES 14: Describe briefly the relationship between controlling and planning.            

Ans: 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. Controlling is a requisites for measuring whether the plan is being properly implemented, if there are any deficiencies in the work and if there is a need for taking corrective actions in order to achieve the planned goals. 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.

QUES 15: 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 analyse the reasons for the poor performance.

Namish found following problems and suggested certain solutions in the working of the business. The number of workers employed was less than what was requisites 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.

 a) Identify the functions of management being performed by the firm in the above situation. b) Name the concept and its source used by the firm to attract more workers for the firm. c) State any two values being followed by Jacob Bros.

Ans: (a) Staffing and Controlling 2 (b) Recruitment, External Source of Recruitment (Recommendations of employees) 1 Values being followed by Joseph Bros. : (i) Creating employment opportunities. (ii) Utilizing resources efficiently by using leftover clothes. (any other suitable value.)

QUES 16:.Hina Sweets is a renowned name for Quesuality sweets since 1935. Harsh the owner of Hina Sweets was worried as the sales had declined during the last three months. When he enQuesuired from the Sales Manager, the Sales Manager reported that there were some complaints about the Quesuality 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.
Ans: Measurement of actual performance is the step in controlling process being described.

QUES 17: State any five points that highlight the importance of ‘controlling’ function of management.

Ans:   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.

QUES18: How does controlling help in “Judging accuracy of standards” and “Ensuring order and discipline”? 

Ans:    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 whether 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.

QUES 19: ‘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.

Ans:    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 reQuesuire 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.

QUES 20: 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 is motivated.

•  State any two values which the production manager wants to communicate to society by his work and behaviour.

Ans:  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 fulfil 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

QUES 21: 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.

Ans: 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 reQuesuired 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.

QUES 22:  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.

Ans:  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.”

QUES 23: PQUESR 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.

Ans:  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 equipment if they are not made available on time.

• Replacing the machinery if it is defective or has become obsolete.