Chapter 16 Management

Installing quality-control procedures that can be audited by independent quality-control experts is fundamental to A. ISO 9000. B. restructuring. C. reduced cycle time. D. the RATER system. E. statistical process control.

A. ISO 9000.

Which of the following is an example of an informational resource control? A. a competition analysis B. a delivery-tracking system C. a debt-repayment schedule D. a leadership survey E. a personality test

A. a competition analysis

Michele manages employees at Maui Tours and Lodging. She has noticed that one of her employees submits via the computer system the same suggestions for continuous improvement multiple times, knowing that performance is evaluated on the number of suggestions only. This problem is typical of ______ control. A. bureaucratic B. market C. decentralized D. autocratic E. functional

A. bureaucratic

Which kind of organization is most likely to try to exert too much control? A. bureaucratic B. market C. employee-driven D. decentralized E. matrix

A. bureaucratic

Which of the following is part of Deming's PDCA cycle? A. check B. direct C. apply D. process E. decide

A. check

Managers can increase overall productivity by increasing the efficiency of all the following except A. goals. B. energy. C. materials. D. labor. E. capital.

A. goals.

A sales forecast is an example of an organizational control from the _____ area. A. informational B. physical C. human resources D. financial E. capital

A. informational

Smith Commercial Development has effective control processes, allowing its managers to discover ______ in bookkeeping right away, before a would-be embezzler could seriously affect its business. A. irregularities and errors B. a potential merger C. competence D. team problems E. tax breaks

A. irregularities and errors

Recruiters for Mountainview College were under extreme pressure to increase an enrollment goal by 10 percent. As a result, they admitted many students who were marginally qualified and who performed poorly in classes. This is an example of which problem associated with control systems? A. overemphasis on means instead of ends B. overemphasis on paperwork C. overemphasis on one instead of multiple approaches D. too much control E. too little participation

A. overemphasis on means instead of ends

Before the fall term began, professors at Hillview College were required to fill out numerous forms, including performance objectives, surveys, and lists of their summer contacts with prospective students. Many professors complained that their time would be better spent preparing for their courses. This situation is an example of which barrier to successful control? A. overemphasis on paperwork B. overemphasis on one instead of multiple approaches C. too much control D. overemphasis on means instead of ends E. too much flexibility

A. overemphasis on paperwork

According to Kaplan and Norton, _______ maps are "visual representations of a company's critical objectives and the crucial relationships among them that drive organizational performance." A. strategy B. positioning C. multidimensional D. customer E. graphic interface

A. strategy

Jimmy's supervisor noticed that he was struggling with the computerized setup for production runs at his new job. The supervisor observed him while he tried it again and gave suggestions for improvement. The supervisor is doing which step of the control process? A. taking corrective action B. establishing standards C. comparing performance to standards D. measuring performance E. controlling productivity

A. taking corrective action

Which of the following is not a principle of Deming management? A. Quality should be aimed at the needs of the consumer. B. Companies should determine which workers are to blame for problems. C. Improved quality leads to increased market share and employment. D. Quality can be improved on the basis of hard data. E. Companies should aim at improving the system.

B. Companies should determine which workers are to blame for problems.

Kim, a customer service manager, tracks monthly complaints and has been trying over the past six months to reduce complaints to less than 0.2 percent through additional training for her staff. She is engaged in A. organizing. B. controlling. C. measuring. D. leading. E. planning.

B. controlling.

Typically, operational control is accomplished through reports issued A. weekly. B. daily. C. monthly. D. annually. E. randomly.

B. daily.

Which of the following is not a perspective of the balanced scorecard? A. internal business B. external processes C. financial D. innovation and learning E. customer

B. external processes

Productivity equals A. labor, capital, energy, and materials, divided by goods and services produced. B. goods and services produced, divided by labor, capital, energy, and materials. C. labor, energy, and capital, divided by goods, services, and materials. D. goods and services and energy and materials, divided by labor and capital produced. E. energy and materials, divided by labor and capital.

B. goods and services produced, divided by labor, capital, energy, and materials.

A(n) _________ represents the profits or losses incurred by an organization. A. expense budget B. income statement C. ratio analysis D. capital expenditures budget E. balance sheet

B. income statement

Which balanced scorecard perspective helps top management focus on what the organization must excel at to effectively meet its financial objectives and customers' expectations? A. operational perspective B. internal business perspective C. customer perspective D. financial perspective E. innovation and learning perspective

B. internal business perspective

Which of the following is not characteristic of an external audit? A. performed by CPAs B. primarily used when management suspects embezzlement C. performed by an independent organization D. verifies that generally accepted accounting principles have been followed E. verifies the accuracy and fairness of financial statements

B. primarily used when management suspects embezzlement

Standards are best measured when they are A. broad. B. quantifiable. C. narrow. D. efficient. E. ethical.

B. quantifiable.

At UPS, delivery ______ vary according to whether a route is urban, suburban, or rural in nature, because conditions vary in each type of route. A. RATER scales B. standards C. ratio analyses D. PDCA cycles E. strategy maps

B. standards

Some managers use _____, which provides four indicators with which organizations can set goals and measure performance. A. a strategic map B. the balanced scorecard C. measurement management D. a strategic scorecard E. evidence-based management

B. the balanced scorecard

______ control is an approach to organizational control that is characterized by informal and organic structural arrangements. A. Relational B. Functional C. Decentralized D. Bureaucratic E. Market

C. Decentralized

_____ is the amount of acceptable deviation from a standard, determined when the standard was established. A. Span of exception B. Breadth control C. Range of variation D. Benchmark E. Zero-based control

C. Range of variation

Which of the following is a one of the seven challenges a manager must deal with in the 21st century? A. sustainability B. ethical standards C. economic stagnation D. globalization E. diversity

C. economic stagnation

Tactical control is performed mainly by A. the CEO. B. top managers. C. middle managers. D. first-level managers. E. team leaders.

C. middle managers.

Monitoring performance to ensure that day-to-day goals are being implemented and taking corrective action as needed is known as ______ control. A. strategic B. functional C. operational D. tactical E. managerial

C. operational

TQM is a comprehensive approach dedicated to continuous A. measurement of quantifiable goals and quick corrections. B. product innovation and organizational learning, over fast cycles. C. quality improvement, training, and customer satisfaction. D. customer input into management strategy and decision making. E. focus on components of service success: tangibles, questions, and margins.

C. quality improvement, training, and customer satisfaction.

Which of the following best describes ERP systems? A. popular recruiting systems that help maximize diversity in the workplace B. comprehensive systems for identifying and measuring changes in productivity C. software information systems that integrate all aspects of business, helping managers stay on top of the latest developments D. training systems for employees that allow self-discovery and correction of weaknesses E. control systems in which managers are made aware of all deviations from standards

C. software information systems that integrate all aspects of business, helping managers stay on top of the latest developments

Which of the following is NOT one of the reasons that control is needed in an organization? A. to adapt to change and uncertainty B. to detect opportunities C. to eliminate the need for teamwork D. to provide performance feedback E. to decentralize decision making

C. to eliminate the need for teamwork

______ is the process of instituting ongoing small, incremental improvements in all parts of an organization. A. MBO B. Reengineering C. Radical innovation D. Continuous improvement E. Productivity

D. Continuous improvement

______ is defined as establishing goals, monitoring performance, comparing it with goals, and taking corrective action as needed. A. Measuring B. Leading C. Organizing D. Controlling E. Planning

D. Controlling

Gina was recently promoted to facilities director at Wholesome Grains. Which of the following should she do immediately as she tries to improve productivity? A. Use the established technology with which her employees are most familiar. B. Rotate all personnel so that each has an opportunity to try something new. C. Hire new employees such that they are similar to those already on the team. D. Establish a system of measurement. E. Cut costs.

D. Establish a system of measurement.

Examining how the organization looks to shareholders is part of which of the balanced scorecard perspectives? A. external perspective B. customer perspective C. internal business perspective D. financial perspective E. innovation and learning perspective

D. financial perspective

A ______ budget allocates increased or decreased funds to a department by using the last budget period as a reference point. A. standardized B. fixed C. zero-based D. incremental E. tactical

D. incremental

One characteristic of incremental budgeting is that it A. allows comparison using various units, like labor hours and dollars. B. is flexible toward changing environmental demands. C. allows easy comparison of different departments doing different activities. D. locks managers into stable spending arrangements. E. requires more time from managers than zero-based budgeting.

D. locks managers into stable spending arrangements.

Which of the following is a primary function of management? A. communicating B. globalizing C. cooperating D. organizing E. influencing

D. organizing

Harbor Casino and Resort requires its casino dealers to have licenses, observes them using closed-circuit TV, and requires detailed reports at the end of each shift. This organization has overcome the control system barrier of A. too much control. B. overemphasis on paperwork. C. overemphasis on means instead of ends. D. overemphasis on one instead of multiple approaches. E. too little participation.

D. overemphasis on one instead of multiple approaches.

TQM's two core principles are A. employee commitment and customer satisfaction. B. financial health and financial stability. C. management and leadership. D. people orientation and improvement orientation. E. radical innovation and continuous improvement.

D. people orientation and improvement orientation.

At Phoenix Instruments, Claudia pulls six samples an hour from an assembly line to examine them for quality defects. If she finds any, she makes adjustments to various pieces of equipment in her area. Claudia's job involves A. feed-forward control. B. benchmarking. C. reduced cycle time. D. statistical process control. E. strategic control.

D. statistical process control.

Britta is trying to measure her salon's productivity during the first quarter. For this period, she should divide _______ by the costs of her staff, loans, materials, and utility bills. A. the number of clients B. the average daily receipts C. her budgeted costs D. the total salon services and products sold E. her projected revenue

D. the total salon services and products sold

At Panther Lighting Fixtures, employees were asked how the quality of the company's customer service could best be measured, and management then implemented a survey system based on the feedback. The company has overcome which of the following barriers to success of control systems? A. overemphasis on one instead of multiple approaches B. overemphasis on paperwork C. overemphasis on means instead of ends D. too little employee participation E. too much control

D. too little employee participation

A(n) ________ budget that can be adjusted over time for changing environmental conditions. A. operating B. incremental C. zero-based D. variable or flexible E. cash

D. variable or flexible

Which of the following is not a financial control? A. budgets B. financial statements C. income statement D. audits E. ISO 14000

E. ISO 14000

Which of the following is the best example of bureaucratic control? A. Southwest Airlines B. Ritz Carlton C. Monica's Diner D. Levi Strauss E. U.S. Army

E. U.S. Army

Current assets, fixed assets, and liabilities are all part of an organization's A. cash flow statement. B. capital expenditures budget. C. income statement. D. expense budget. E. balance sheet.

E. balance sheet.

Which of the following areas of control for organizations exerts informal control? A. structural B. human resources C. informational D. competitive E. cultural

E. cultural

Which of the following is a step in the control process? A. complete a job redesign B. evaluate opportunities C. compare work units to one another D. implement TQM E. establish standards

E. establish standards

Which of the following may be done as corrective action in the control process? A. establish standards B. renew standards C. compare performance to standards D. align processes with goals E. evaluate performance and take action

E. evaluate performance and take action

A _____ budget allocates resources on the basis of a single estimate of costs. A. unitary B. zero-based C. cash D. incremental E. fixed or static

E. fixed or static

Kara was required to take a word-processing test as part of her application for an executive assistant position. This control is part of the ______ area. A. structural B. physical C. financial D. informational E. human resources

E. human resources

Which of the following is not a purpose of a manager? A. plan B. organize C. lead D. control E. increase globalization

E. increase globalization

Which of the following is not a characteristic of a successful control system? A. strategic and results-oriented B. timely, accurate, and objective C. realistic, positive, and understandable D. flexible and encourages self-control E. inflexible to optimize control

E. inflexible to optimize control

Techniques for improving quality include all of the following except A. Six Sigma. B. outsourcing. C. reduced cycle time. D. statistical process control. E. market share.

E. market share.

All of the following are reasons why performance falls significantly short of the standard except A. unrealistic standards. B. changing conditions. C. insufficient resources. D. insufficient management attention. E. unawareness of performance drop.

E. unawareness of performance drop.

At Polar Sportswear, orders have significantly exceeded projections, and Chris, the operations director, has decided to hire for a third shift in the plant. Chris is clearly operating with the use of a(n) ______ budget. A. zero-based B. incremental C. cash D. fixed E. variable

E. variable

Corrective action is a control principle that states that managers should be informed of a situation only if data show a significant deviation from standards. (True/False)

FALSE

If a manager decreases the efficiency of labor and makes no improvements to the efficiency of capital, an increase in productivity will result. (True/False)

FALSE

Unlike the ISO 9000 series, the ISO 14000 series identifies standards for environmental performance. (True/False)

TRUE

A balance sheet summarizes an organization's overall financial worth, or its assets and liabilities, at a specific point in time. (True/False)

TRUE

A principle of Deming management is that quality should be aimed at meeting the needs and expectations of the ultimate user. (True/False)

TRUE

A variable budget can be adjusted over time to accommodate pertinent changes in the environment. (True/False)

TRUE

An income statement summarizes an organization's financial results over a specified period of time, such as a quarter or a year. (True/False)

TRUE

Bureaucratic control is most appropriate for an organization in which the tasks are explicit and certain. (True/False)

TRUE

Controls allow top management to decentralize decision making at lower levels within the organization. (True/False)

TRUE

Except for in rare instances, employees at George's Pro Painting take responsibility for their own work and how it is done, rather than being governed by a rigid set of rules. George's Pro Painting is using decentralized control. (True/False)

TRUE

GlobalSatellite, applying TQM, restructured its service call procedures and eliminated some steps involved so that employees can finish each call faster. Global Satellite is attempting to reduce cycle time. (True/False)

TRUE

Incremental budgeting allocates increased or decreased funds to a department by using the last budget period as a reference point; only incremental changes in the budget request are reviewed. (True/False)

TRUE

Productivity is defined by the formula of outputs divided by inputs for a specified period of time. (True/False)

TRUE

The control process begins with establishing standards. (True/False)

TRUE

Twice daily, factory workers at Mountain CopperWorks select random samples from the production runs and test them for quality, rejecting runs if too many samples fall outside a standard range of acceptability. These workers are engaged in statistical process control. (True/False)

TRUE