Chapter 11

Why is return on investment (ROI) the most commonly used financial performance measure?

It allows managers of one organization to compare performance with that of other organizations in its industry.

Is it advantageous to have subordinates participate in goal setting?

It strengthens subordinates' commitment to achieving goals and meeting budgets.

________ is the movement of an organization away from its present state toward some preferred future state to increase its efficiency and effectiveness.

Organizational change

________ control tends to be the first type of control that managers at all levels use to evaluate performance.

Output

________ calculation helps managers assess a firm's availability to meet payments to short-term creditors without impacting inventory levels.

Quick ratio

According to the force-field theory,

a wide variety of forces arises from the way an organization operates that make organizations resistant to change.

To monitor financial performance, a(n) ________ ratio is used to assess cost of goods sold relative to inventory levels.

activity

Once managers have measured actual performance, they should

compare actual performance to the standards.

In concert with quality management programs, ________ controls help monitor the quality of goods or services at each step in the production process to alert managers to problems.

concurrent

After evaluating measures of performance, managers must

decide whether to take corrective action.

What is the most instantaneous and powerful form of behavior control?

direct supervision

Mitchell regularly walks through the manufacturing floor, checking each station and guiding workers on his team. This is an example of

direct supervision.

MBO starts when top managers

establish overall organizational objectives.

A control process begins with

establishing performance standards.

At the output stage of a production process, ________ is used to detect problems and trigger management action.

feedback control

In order to anticipate problems before they arise, managers should develop a system for ________ control.

feedforward

Organizational performance can be hindered when managers

focus on only one performance standard instead of many different standards

When evaluating performance based on a revenue budget approach, on what would you advise managers to focus?

how well the organization generates earnings from goods and services sold

Each fiscal year, Dwayne is allocated an operating budget and then evaluated based on the amount of goods produced by his organization. Dwayne's performance is evaluated on a(n) budget approach.

profit

A restaurant manager routinely measures the number of customer complaints and how often customers leave negative reviews on its social media page. These controls help the restaurant improve its

quality