MANA3335 Ch. 14 Practice Test

Which of the following control systems is likely to be highly effective?

*A control system that provides objective information {Timeliness does not necessarily mean quickness. The control system should provide information that is as objective as possible}

Which of the following is used to summarize financial performance over a period of time?

*Income statement {Operating ratios indicate the effectiveness of specific functional areas. An income statement summarizes financial performance over a period of time}

Which of the following is one of the aspects of strategic control?

*Leadership {Bureaucratic control is an approach to organization design characterized by formal and mechanistic structural arrangements}

The local television network received a tip about a news story. Before the network shared the story, it investigated the accuracy of the information. Which type of control monitors the quality of information before it enters the organization?

*Preliminary {Operations control focuses on the processes the organization uses to transform resources into products or services}

Everyone who works at Smiles Elementary School must complete a thorough background check and drug testing before being hired. Which type of control is Smiles Elementary School using?

*Preliminary {The postaction form of operations control regulates outputs after operational transformation. The preliminary form of operations control regulates inputs prior to operational transformation}

Pallavi is determining how many units of production she has to complete each shift to make her goal this month. Which type of budget is she developing?

*Production {The space budget would show how many feet or meters of space is available for various functions}

Which of the following is a potential disadvantage of using a budget?

*The budget can be applied too rigidly {Some managers apply budgets too rigidly. Budgets are intended to serve as frameworks, but managers sometimes fail to recognize that changing circumstances may warrant budget adjustments}

Which of the following is true of organizations using bureaucratic control?

*They rely on strict rules and a rigid hierarchy {Organizations that use bureaucratic control rely on strict rules and a rigid hierarchy}

What is the goal of effective controls in organizations?

*To successfully regulate and monitor activities {Effective control, whether at the operations, financial, structural, or strategic level, successfully regulates and monitors organizational activities. To use the control process, managers must recognize the characteristics of effective control and understand how to identify and overcome occasional resistance to control}

Why is it important to provide checks and balances in control systems?

*To verify the accuracy of performance indicators {Control should be linked with planning. The more explicit and precise this linkage, the more effective the control system is}

Timeliness means providing information when necessary. When would the need for timely information be high?

*When circumstances are unstable {The control system should provide information that is as objective as possible. Measures that are objective likely result in information that does not have to be as frequent}

Control systems are more effective when they are timely, meaning that information is shared _____.

*as often as necessary {Timeliness describes a control system that provides information as often as is necessary}

Which of the following is a purpose of control?

*Coping with organizational complexity {Control provides an organization with ways to adapt to environmental change, to limit the accumulation of error, to cope with organizational complexity, and to minimize costs. Coping with organizational complexity is a purpose of control}

What is the focus of preliminary controls?

*Inputs {Costs are not one of the three areas of operations control}

Avec is writing performance standards for her sales team. Which of the following would help the team ensure their standards are being met?

*Make them clear and easy to calculate {Performance indicators are measures of performance that provide information that is directly relevant to what is being controlled. However, employees then need to be able to measure their performance}

A new employee training program represents which form of operations control?

*Preliminary {A new employee training program represents a preliminary form of operations control. Preliminary control measures focus on resources before they impact operational systems and performance}

Independent appraisals of an organization's accounting, financial, and operational systems are referred to as _____.

*audits {A budget is a plan expressed in numerical terms. Audits are independent appraisals of an organization's accounting, financial, and operational systems}

Rapher Systems and Gibson Tech recently merged. Their many different systems needed to be revised to work together, and many decisions needed to be made about suppliers, processes, and goals. While the long-term forecast for the new entity is promising, the short-term results have been disappointing. This illustrates the need for control systems that _____.

*cope with organizational complexity {Of the four functions of control, this scenario illustrates the importance of control to cope with organizational complexity}

Aaliyah is reviewing a list of the assets and liabilities that the company currently holds. What is Aaliyah looking at?

*A balance sheet {An income statement summarizes financial performance over a period of time. A balance sheet is a list of assets and liabilities of an organization at a specific point in time}

Sushil wants to ensure her employees are making enough effort to handle their responsibilities in a timely manner. To do this, Sushil set up performance standards, and employees fill in weekly control sheets that report their activities. Which element of control is Sushil implementing?

*Accountability {An organization that instructs its employees when to come to work, where to park, when to have morning coffee, and when to leave for the day is exerting considerable control over people's daily activities}

Raj has been hired to review the financial records for a mid-sized company in the area. The company hired Raj to ensure the organization's accounting proceed and financial statements are compiled accurately, and information can be verified. What has this company asked Raj to conduct on its behalf?

*An external audit {Whereas external audits are conducted by external accountants, an internal audit is Handled by employees of the organization}

Which of the following shows a list of assets and liabilities of an organization at a specific point in time?

*Balance sheet {A financial statement is a profile of some aspect of an organization's financial circumstances. The balance sheet lists the assets and liabilities of the organization at a specific point in time, usually the last day of an organization's fiscal year}

Which type of control has the goal of employee compliance?

*Bureaucratic {The goal of decentralized control is employee commitment to the organization. The goal of bureaucratic control is employee compliance}

Which organizational design uses a tall structure with top-down influence?

*Bureaucratic {The organizational design of bureaucratic control is a tall structure with top-down influence}

RadTrek focuses rewards on individual performance. It insists that employees meet minimally acceptable levels of performance and allows limited and formal employee participation. These are aspects of which approach to organization design?

*Bureaucratic control {Financial control is concerned with the organization's financial resources. In companies that use bureaucratic control, employees meet minimally acceptable levels of performance. They focus their rewards on individual performance and allow only limited and formal employee participation}

Gnomatics relies on numerous rules to regulate employee travel, expense accounts, and other expenses. Its performance appraisal system precisely specifies minimally acceptable levels of performance for everyone. These are characteristics of which approach to organizational design?

*Bureaucratic control {Rules to regulate employees' behavior and clearly defined minimum standards are characteristics of bureaucratic control}

What is the best way to integrate planning and control?

*By accounting for control as plans develop {Control should be linked with planning. The more explicit and precise this linkage, the more effective the control system is. The best way to integrate planning and control is to account for control as plans develop. In other words, as goals are set during the planning process, attention should be paid to developing standards that will reflect how well the plan is realized}

How can a manager help to overcome resistance to control?

*By developing verification procedures {Resistance to control can be overcome by increasing employee participation. Resistance to control can be overcome by developing verification procedures. Multiple standards and information systems provide checks and balances in control and allow the organization to verify the accuracy of performance indicators}

Managers at Sparky's Auto Parts decided to broaden their product line beyond spark plugs. They decided on the level of sales they wanted for each product for each of the next five years. How has Sparky's linked their control system?

*By integrating it with planning {Control should be linked with planning. The more explicit and precise this linkage, the more effective the control system is. The best way to integrate planning and control is to account for control as plans develop}

Under which system of strategic control will managers from the home office visit foreign branches to observe firsthand how the units are functioning?

*Centralized {Bureaucratic control is an approach to organization design characterized by formal and}

Which control strategy allows the home office to stay better informed of the performance of foreign units and have more control over how decisions are made?

*Centralized {Organizations that use a decentralized control system require foreign branches to report less often and in less detail}

EMCW is a large international business with interests in most developed nations. In order to meet certain benchmarks, there must be a certain level of consistency throughout the operations, as well as regular reporting to the home office. Which type of strategic control function should be used here?

*Centralized {Preliminary is not one of the strategic control perspectives. The need for consistency calls for a centralized approach to strategic control}

During a review, Zereth found that the established standards were too difficult to reach without sacrificing quality. What should Zereth do about the current standards?

*Change the standard {Sometimes performance that is higher than expected may also cause problems for organizations. When this happens, the organization must look at what is causing the deviation and make adjustments}

While testing new computer code, Software Is Us found the program does not work the way it intended. Which step has it reached in the control process?

*Considering corrective action {The second step in the control process is measuring performance. Performance measurement is a constant, ongoing activity for most organizations}

How do organizations describe the regulation of organizational activities in such a way as to facilitate goal attainment?

*Control {Structural control is concerned with how the elements of the organization's structure are serving their intended purpose. Control is the regulation of organizational activities in such a way as to facilitate goal attainment}

Before the control process can be implemented, a firm needs to set a target against which it will compare performance. What needs to be established?

*Control standard {The second step in the control process is measuring performance. Performance measurement is a constant, ongoing activity for most organizations}

Teresita is responsible for helping managers control activities and gathering and assimilating relevant information for decision making. Which type of position does Teresita have in the organization?

*Controller {Strategic control generally focuses on five aspects of organizations—structure, leadership, technology, human resources, and information and operational control systems. For example, an organization should periodically examine its structure to determine whether it is facilitating the attainment of the strategic goals being sought}

Maria has been analyzing the company's various financial statements, and she has some concerns regarding the company's ability to make the interest payments on its loans. What type of ratio should she calculate to fully assess this aspect of the company's financial health?

*Coverage {Liquidity ratios indicate how liquid (easily converted into cash) an organization's assets are. Coverage ratios help estimate the organization's ability to cover interest expenses on borrowed capital}

Pallavi is a manager who practices decentralized control, and she has a good detail of control over what is acceptable in terms of employee behavior, and what is not. Last week, one of Pallavi's employees wore shorts to work. While there is no formal dress code, Pallavi found this attire to be too casual and unacceptable. She is now concerned that other employees will wear shorts to work as well. What can Pallavi do to ensure this behavior does not continue?

*Deal with inappropriate attire on a case-by-case basis {In an example from a bureaucratic firm, a company made the decision to allow employees to wear casual attire to work. But a committee then spent weeks developing a 20-page set of guidelines on what was and was not acceptable}

Raul wants to determine the company's ability to meet long-term financial obligations. Which type of ratio should Raul look at to find this information?

*Debt {Coverage ratios help estimate the organization's ability to cover interest expenses on borrowed capital. Debt ratios reflect ability to meet long-term financial obligations}

Slim Pickin's is a small start-up company located in Kansas City, MO. Its owner, Shareen, developed a line of gluten- and dairy-free power bars that is gaining the attention of health-minded consumers. Slim Pickin's has very few formal job assignments or work boundaries. Everyone pitches in where needed. Shareen distributes a generous share of profits with all of the workers equally. As Shareen continues to build her organization, which type of structural control will help ensure that the organization continues to be informal with high levels of employee commitment?

*Decentralized {As Shareen continues to build her organization, a decentralized type of structural control is recommended to ensure that the organizational design is achieving its intended results. Committed employees, informality, performance above expectations, group rewards, and informal design and participation all suggest that a decentralized control system is warranted at Slim Pickin's}

Purity Water Filtration Systems (PWFS) is a large international business with interests in most emerging nations. Varying conditions in each nation require that each division be free to develop localized approaches to satisfy the unique needs of each market. Actions that grow sales in one country are not necessarily effective in the others. Which strategic control perspective should this company use?

*Decentralized {Preliminary is not one of the strategic control perspectives. When conditions suggest that adaptability is required to meet localized market needs, divisional management should be given flexibility to react. This condition calls for a decentralized approach to strategic control}

TravelTrek is an international company that specializes in the travel industry. The home office does set some standards and benchmarks, but the local offices have a lot of freedom to make their own decisions toward meeting those goals. Which strategic control perspective does TravelTrek take with their international offices?

*Decentralized {Screening is not one of the strategic control perspectives. This level of decision making on the local level reflects a decentralized approach to strategic control}

As a small business owner, Azim wants to hire only those people who will show a high level of commitment to the company. If that were the only factor to consider, which approach to organization design would be most appropriate for Azim?

*Decentralized control {A goal of decentralized control is employee commitment to the organization}

What is the focus of a strategic control strategy?

*Determining how well strategies achieve organizational goals {Decentralized control relies heavily on group norms and a strong corporate culture and gives employees the responsibility for controlling themselves. Employees are encouraged to perform beyond minimally acceptable levels}

When Mikel began the redesign of the plant floor layout, he knew some employees would resist the changes he was likely to propose. What should Mikel do to overcome this resistance?

*Encourage employee participation {Multiple standards and information systems provide checks and balances in control and allow the organization to verify the accuracy of performance indicators. This will not encourage employees to be less resistant to the plant floor changes}

Which type of control is used for managing resources that flow into the organization, such as revenue and shareholder investments, and those resources that flow out of the organization, such as wages, salaries, and expenses?

*Financial {An operating budget is concerned with planned operations within the organization. It outlines what quantities of products or services the organization intends to create and what resources will be used to create them}

Which area of control is considered to be the most important area because it is related to the control of all other resources in an organization?

*Financial {Strategic control focuses on how effectively the organization's strategies are succeeding in helping the organization meet its goals}

One of Mikel's suppliers experienced a fire at its plant, and shipments were going to be delayed by three weeks. Which type of control system would help Mikel respond to this change?

*Flexibility {The control system itself must be flexible enough to accommodate change. Organizations that have flexible control systems are better able to adapt to the rapidly changing environment than businesses with less flexible control systems}

In a decentralized organization, where are rewards generally directed?

*Group performance {The goal of bureaucratic control is employee compliance. Organizations that use it rely on strict rules and a rigid hierarchy, insist that employees meet minimally acceptable levels of performance, and often have a tall structure. They focus their rewards on individual performance and allow only limited and formal employee participation}

Even though internal audits are more expensive than external audits, many employers do them. What is the advantage to an internal audit?

*Identification of significant aspects of accounting systems, other than technical correctness {Because the staff members who conduct them are a permanent part of the organization, internal audits tend to be more expensive than external audits. But employees, who are more familiar with the organization's practices, may also point out significant aspects of the accounting system besides its technical correctness}

One of Amina's employees reported increased customer satisfaction levels and reductions in the time it took to handle customer complaints. However, Amina's employee overinflated these claims, and they were simply inaccurate. What is the likely result of this inaccurate information for Amina?

*Inappropriate managerial action {Managers make a surprisingly large number of decisions based on inaccurate information. The result of inaccurate information is inappropriate managerial action. For example, Amina might choose to cancel a training class that might really be needed}

In an organization with bureaucratic control, where are rewards generally directed?

*Individual performance {In decentralized organizations, employees are encouraged to perform beyond minimally acceptable levels. They direct rewards at group performance and favor widespread employee participation}

Which of the following is true of an organization with decentralized control?

*It has organic structural arrangements {Organizations that use bureaucratic control allow limited and formal employee participation. Decentralized control is an approach to organizational control characterized by informal and organic structural arrangements}

Which of the following is a characteristic of an effective control system?

*It is timely {An effective control system is integrated with planning}

Which of the following is true of screening control?

*It is useful in identifying the causes of problems {Preliminary control monitors the quality of resources before they enter the organization. Screening control is useful in identifying the causes of problems}

Maria is the controller for a specialty spice company. She oversees the firm's budget process. When she first arrived at the company, top managers made resource allocation decisions as they saw fit for pursuing strategic goals. When Maria became the controller, she dissolved the committee in order to strengthen the budget process. What is the advantage of using a departmental budget instead of a top-down approach to budgeting?

*It will enable coordination and communication between divisions {Rigid control and inflexibility are shortcomings of the budget process. Eliminating the committee replaces a top-down approach that can stifle cooperation between divisions}

Ramkumar asks each division head to provide him with operational plans that forecast production levels and the human resources needed to achieve them so that he can create a budget for this. Which type of budget does Ramkumar plan to develop?

*Labor {The labor budget is a projection of workforce labor required to meet expected production levels for the upcoming period}

Kaia has been analyzing the company's various financial statements. She knows that the value of the company's assets would more than cover the purchase price of some new equipment, but she needs to determine how quickly she can turn some of those assets into cash. Which type of ratio should she calculate?

*Liquidity {Coverage ratios help estimate the organization's ability to cover interest expenses on borrowed capital. Liquidity ratios indicate how liquid (easily converted into cash) an organization's assets are}

Which type of budget is a budget for hours of direct labor considered to be?

*Nonmonetary {A nonmonetary budget is simply a budget expressed in nonfinancial terms, such as units}

RadCycle, a bicycle manufacturer, is deciding on the quantities of each type of bicycle to produce next year and the resources it will need to create them. Which type of budget should RadCycle develop?

*Operating {An operating budget is concerned with planned operations within the organization. It outlines what quantities of products or services the organization intends to create and what resources will be used to create them}

Atmir is reviewing financial statements to understand the effectiveness of each specific functional area. Which type of ratio should Atmir review?

*Operating {Operating ratios indicate the effectiveness of specific functional areas rather than of the total organization}

At which level of an organization is a nonmonetary budget most likely to be used?

*Operating unit heads {An organizational budget is compiled for approval by the budget committee, controller, and CEO}

Which level of control is quality control considered to be?

*Operations {Quality control is not a type of strategic control. Operations control focuses on the processes that an organization uses to transform resources into products or services. Quality control is one type of operations control}

The customer service techs at LWC Co. wear uniforms so that they are easily recognizable when they go out to service accounts. Whenever changes need to be made to the uniforms, various options are assembled, and the service techs are polled to help choose the new uniforms. What is LWC Co. using to overcome any resistance to the new uniforms?

*Participation {When there is inappropriate focus, the control system may be too narrow, or it may focus too much on quantifiable variables and leave no room for analysis or interpretation}

When managing the construction of a new building, Anke has a specific schedule that must be followed. An error or backup in one aspect could delay the entire project. What can Anke use to ensure the project is on track?

*Performance indicators {A final aspect of establishing standards is to identify performance indicators. Performance indicators are measures of performance that provide information that is directly relevant to what is being controlled}

Purity Water Filtration Systems uses a reverse osmosis double pass system to purify water for industrial applications. Water purity is monitored continuously through the filtration operation to achieve 99 percent removal of total dissolved solids (TDS) and 97 percent of naturally occurring organics. This afternoon, water tested at the end of the batch run indicated TDS levels of 1.8 percent. Which form of operations control was used to determine TDS and organic content levels after the filtration process?

*Postaction {Measuring TDS and organic content after the filtration process is a form of postaction operations control. The postaction form of operations control regulates outputs after operational transformation}

Which type of control can alert managers that an employee has exceeded expectations and deserves recognition?

*Postaction {Postaction control provides a basis for rewarding employees. Recognizing that an employee has exceeded personal sales goals by a wide margin, for example, may alert the manager that a bonus or promotion is in order}

Quality assurance testing of the gold master version of a software program is an example of which type of control?

*Postaction {The screening form of operations control takes place during the transformation of inputs into outputs. The postaction form of operations control regulates outputs after operational transformation}

Hiring only qualified employees and ordering parts that meet high quality standards are two examples of which type of control?

*Preliminary {The postaction form of operations control regulates outputs after operational transformation. The preliminary form of operations control regulates inputs prior to operational transformation}

Jacob's Kosher Deli ensures that all ingredients and food products that come into the restaurant are kosher. Which type of control is Jacob's Kosher Deli using?

*Preliminary {The postaction form of operations control regulates outputs after operational transformation. The preliminary form of operations control regulates inputs prior to operational transformation}

Stan works at the receiving dock at Midwestern Textiles. He checks every bolt of fabric that is delivered to the warehouse to make sure it matches all of the specifications listed on the spec sheet before entering it into inventory. Any shipments not matching the specs are returned to the supplier. Which type of control is Stan using?

*Preliminary {The postaction form of operations control regulates outputs after operational transformation. The preliminary form of operations control regulates inputs prior to operational transformation}

L'Meese's organization has experienced rapid growth and has expanded into the South American market. Since completing the new facility three years ago, the company's South American division has struggled to meet strategic goals of growth and full-scale production. How should top management handle the strategic control variance?

*Replace the leaders of the South American division {When strategic control variables indicate a failure to attain organizational goals, a correction to one of the variables—structure, leadership, technology, human resources, or information/operational control systems—is necessary. As this facility is just three years old, it should be assumed that due diligence verified market potential and operational viability. In addition, it is too soon to completely abandon such a new investment. Replacing leaders of the South American division is the best correction option presented}

Ugar manages his budget based on forecasts provided by each department manager. The amount of income each department expects to receive from normal operations is included in these forecasts. Which type of budget is Ugar using?

*Revenue {The expense budget anticipates expected costs for the upcoming period. The sales or revenue budget projects expected income from normal business operations}

Purity Water Filtration Systems uses a reverse osmosis double pass system to purify water for industrial applications. Water purity is monitored continuously through the filtration operation to achieve 99 percent removal of total dissolved solids (TDS) and 97 percent of naturally occurring organics. Which form of operations control is being used to monitor TDS and organic content during the filtration process>

*Screening {The preliminary form of operations control regulates inputs prior to operational transformation. The company is screening operations to regulate water quality and the performance of the filtration system}

Quality assurance testing of all alpha and beta versions of a software program is an example of which type of control?

*Screening {The screening form of operations control takes place during the transformation of inputs into outputs}

On the production line, all employees must have a quality level of 99 percent or higher. Which of the following elements of control is this?

*Standard {Strategic control focuses on how effectively the organization's corporate, business, and functional strategies are succeeding in helping the organization meet its goals}

Which type of control focuses on structure, leadership, technology, human resources, and information and control systems of organizations?

*Strategic {Strategic control generally focuses on five aspects of organizations—structure, leadership, technology, human resources, and information and operational control systems}

Which type of control is aimed at ensuring that an organization is maintaining an effective alignment with its environment and moving toward achieving its strategic goals?

*Strategic {Strategic control is aimed at ensuring that an organization is maintaining an effective alignment with its environment and moving toward achieving its strategic goals}

Rabeya developed a line of gluten- and dairy-free power bars that is gaining the attention of health-minded consumers. Brand awareness is growing rapidly. Future sales growth will depend on rapid expansion into new locations and through new types of sales channels. The extent to which Rabeya is able to meet these expansion goals should be regulated through which control measures?

*Strategic {Structural controls serve to ensure that organization and job design achieve their intended purpose. Strategic controls ensure that the organization is meeting its business goals}

When Lupita has a question about her work, she finds that she has a difficult time determining where to go for help. Sometimes she is directed to ask her manager, sometimes a client, and sometimes a coworker. Which element of control is ineffective in Lupita's department?

*Structural {Operations control focuses on the processes the organization uses to transform resources into products or services}

The new CEO of EMCW has started to initiate a number of changes to the company. One of his initiatives is to shift from a U-form to an M-form design to spur growth. This change falls into which aspect of strategic control?

*Structure {Changes of this type to the design of a company are changes to its structure}

Laura is the controller of Master Tractor Ltd., an international tractor supply and equipment company with distribution outlets located in 18 countries. She is evaluating Master Tractor's organizational design and improving the company's structural controls based on systems that will work in each country where an outlet is located. Which of the following conditions calls for Laura to use a decentralized control system?

*The company relies on group norms and a strong organizational culture {The group norms and strong organizational culture call for Laura to use a decentralized control system. When formality within the organization is defined by culture and group norms rather than strict rules and hierarchy, a decentralized control system is merited}

Bhavik has established a timetable for comparing performance to standards. What should he keep in mind when he sets the timetable?

*The complexity of the work {The second step in the control process is measuring performance. Performance measurement is a constant, ongoing activity for most organizations. For control to be effective, performance measures must be valid}

What does a screening control process rely heavily on?

*The feedback process {Preliminary control concentrates on the resources—financial, material, human, and}

Why are financial budgets considered to be critically important to an organization?

*They indicate where resources will be coming from and how they will be used {A financial budget indicates where the organization expects to get its cash for the coming time period and how it plans to use it. Because financial resources are critically important, the organization needs to know where those resources will be coming from and how they are to be used}

Marah is reviewing how well her employee, Ozlem, managed her budget this year. Why would Marah review how well Ozlem managed her budget?

*To evaluate the performance of Ozlem and her organizational unit {A balance sheet budget is a forecast of the organization's assets and liabilities in the event all other budgets are met}

What is the purpose of screening control?

*To focus on meeting standards for product or service quality during the actual transformation process {Postaction control focuses on the outputs of an organization after the transformation process is complete. Screening control focuses on meeting standards for product or service quality or quantity during the actual transformation process itself}

Why are more and more companies adopting screening controls in the transformation process?

*To increase employee participation {More and more companies are adopting screening controls because they are an effective way to promote employee participation and catch problems early in the overall transformation process}

When are attempts to control procedures in the workplace most likely to become problematic, and when are employees more likely to resist control?

*When employees feel they are unreasonable {The control system should provide information that is as objective as possible. Many employees resist control, especially if they feel overcontrolled, if they think control is inappropriately focused on rewards inefficiency, or if they are uncomfortable with accountability}

When is a control system considered to be flexible?

*When it can accommodate change {The control system must be flexible enough to accommodate change. When a change in product line changes the number of raw materials needed, or when the required quantities of the existing materials change, the control system should be flexible enough to handle the revised requirements}

When do postaction controls occur?

*When the transformation process is complete {Preliminary control attempts to monitor the quality or quantity of financial, physical, human, and information resources before they actually become part of the system}

Moto To Go, a large rental car company, recently increased its fleet by purchasing a significant number of SUVs. Rentals have not increased as forecast because of the high cost of fuel, and many of these SUVs sit on the lots. A market review indicated that, while SUVs were quite popular the year the new vehicles were purchased, consumers are now looking for more fuel-efficient rental vehicles. This illustrates the need for control systems that _____.

*adapt to environmental change {Of the four functions of control, this scenario illustrates the importance of control to adapt to environmental change}

Bureaucratic control is an approach to organization design that is characterized by _____.

*formal and mechanistic structural arrangements {Organizations using decentralized control favor widespread employee participation. Bureaucratic control is an approach to organization design characterized by formal and mechanistic structural arrangements}

Stan works for Moto To Go, a large rental car company. Before he was able to work independently in his job, he had to complete four training courses. Stan had to pass each course with a minimum achievement level of 90 percent. Moto To Go's new employee training program is a method of control over the company's _____.

*human resources {Inventory, equipment, and quality control measures regulate physical resources. Training and development are a function of regulating the company's human resources}

LWC Co. publishes a weekly magazine. The editorial team is required to meet an exact deadline every week in order to secure the guaranteed press time. As a result, they are not always able to follow all leads or check facts in the stories they run. The magazine tends to have errors that could have been avoided. The control system at LWC suffers from _____.

*inappropriate focus {Rewards for inefficiency is not the issue in this scenario. The control system is too narrow and is focusing on only one variable}

Stan works for Moto To Go, a large rental car company. Before he was able to work independently in his job, he had to complete four training courses. Moto To Go's new employee training program serves to ensure tight control of the company's _____.

*operational processes {Training and development are important tools for ensuring consistency and accuracy in the company's operational activities. Accounting, budgeting, and financial reporting practices regulate financial resources}

Tariq finished his current project four days ahead of schedule. This is the second time this year he has beat his deadline. However, rather than turning in the completed work and securing his next assignment, Tariq holds on to the project until the due date. He is concerned that if he consistently beats his deadlines, the manager will start giving him shorter schedules on all his projects. Tariq's resistance to control is based on _____.

*rewards for inefficiency {Overcontrol is not the issue in this scenario. Tariq's resistance to control is based on rewards for inefficiency}

A capital expenditure budget shows _____.

*the costs of major assets such as a new plant, machinery, or land {A capital expenditure budget shows the costs of major assets such as a new plant, machinery, or land}

LWC Co. tracks errors made by employees on a daily basis. Any day that an employee makes three or more errors, a reprimand is entered into that employee's personnel file. At the start of each project, employees tend to make more errors. But after three or four days, most employees work error-free and do so for the remainder of the project. However, most employees at LWC have multiple reprimands in their files for exceeding the daily error allowance, which has led to a drop in morale and lower productivity. LWC is facing resistance to control because of _____.

*too much accountability {Overcontrol is not the issue in this scenario. Occasionally, organizations try to control too many things. This becomes especially problematic when the control directly affects employee behavior. The problem is too much accountability}