Question 1

Edgar James, a process engineer with WMX Technologies, is concerned with the number of activities, processes, and items that are measured and controlled in his system. Edgar is concerned with

Accepted Answer

The concern about the number of activities, processes, and items that are measured and controlled in a system relates to the amount of variety in the control system. This is because variety in this context refers to the different types of elements and processes that need to be managed within the system.

Question 2

When deciding how to install "checks and balances in his new business, the firm's owner considered implementing a simple control system due to its low cost and ease of implementation. However, after much thought, the owner considered the __________, which suggests that such simple control systems may not have sufficient variety to cope with the complex systems that they are trying to control.

Accepted Answer

The correct answer is the law of requisite variety, which states that the control system must be as varied and complex as the system it aims to control. This principle is crucial in ensuring that the control system can effectively manage and respond to the complexities of the system it oversees.

Question 3

James Blum, the President of Williams Construction, is concerned that his company's control system is not adequate to cope with the complexity of its operations. Mr. Blum knows that, to maintain adequate control in his company, he must either increase the amount of variety in his control system or

Accepted Answer

According to Ashby's Law of Requisite Variety, to manage a system effectively, the variety in the control system must be equal to or greater than the variety in the system being controlled. Therefore, if increasing the variety in the control system is not feasible, reducing the variety in the system being controlled is a viable strategy to maintain adequate control.

Question 4

Lucy Mills, a production engineer at AMEX Semiconductor, is concerned with the time lags that occur between observation, reporting, instituting, and return of deviations within her system. Lucy is concerned with

Accepted Answer

The answer of Lucy Mills, a production engineer at AMEX...

Question 5

The manager of a women's shoe store in the mall recognizes that if she doesn't have the latest fashions in stock when her patrons visit the store, they will probably not return to the store later to purchase the shoes. Sales lost in this manner, between the time of recognizing the need for more shoes and ordering/receiving additional shipments of shoes, can be reduced by strengthening which of the following control system design factors?

Accepted Answer

The ability to anticipate problems allows the manager to order new stock before it runs out, thus reducing sales lost during restocking.

Question 6

In the context of control, __________ refers to the precision with which a control measure can be made.

Accepted Answer

Sensitivity refers to the precision with which a control measure can be made. It indicates how responsive a control system or measure is to changes, allowing for precise adjustments and monitoring.

Question 7

Jim Smith is worried about the reliability of the machines in his shop that measure the length of the electrical wiring that he sells. If the length of the wiring is not absolutely accurate, it must be scrapped. Jim is worried about

Accepted Answer

The concern about the reliability of machines measuring the length of electrical wiring directly relates to the sensitivity of the measuring device. If the device is not sensitive or accurate enough, it could lead to inaccuracies in measurement, resulting in the need to scrap the wiring.

Question 8

As a way of measuring customer satisfaction, many organizations ask their customers to fill out customer satisfaction surveys. The precision with which these surveys actually measure customer satisfaction is referred to as

Accepted Answer

Sensitivity refers to the ability of a measure (in this case, customer satisfaction surveys) to accurately detect or measure the variable of interest, which is customer satisfaction.

Question 9

Dr. Sandler is a no-nonsense manager who does not like to engage in a lot of small talk with his employees. In fact, he once told them in a meeting, "Don't tell me what is right with our performance system; only tell me what is wrong. Dr. Sandler is advocating the use of which of the following forms of feedback reports?

Accepted Answer

The answer of Dr. Sandler is a no-nonsense manager who...

Question 10

Gene Roberts, the CEO of Regal Sportswear, receives reports every business day that highlight only those things that fail to meet his company's established standards. From this description, we know that Mr. Roberts is interested in

Accepted Answer

Variance reporting focuses on highlighting deviations from established standards, which matches the description of the reports Mr. Roberts receives.

Question 11

Rather than addressing all of the problems of a struggling small business, the manager, Damian Leone, targets only the troubled areas that are brought to his attention. In fact, on days when nothing goes wrong, no one reports anything to Damian. This approach to organizational control that solely focuses on the elements that are not meeting the standards is called

Accepted Answer

Management by exception is a strategy where managers intervene only when there are deviations from expected performance, focusing on the areas that are not meeting standards, as described in the scenario.

Question 12

As executive vice president of Hill Enterprises, Sally Hill focuses on the trouble areas in her firm that are not meeting the company's established standards. Sally is practicing

Accepted Answer

Management by exception is a management style in which managers intervene only when their employees fail to meet their performance standards or when there are deviations from expected results. Sally Hill's focus on trouble areas that are not meeting the company's established standards is a classic example of this approach, as it involves addressing issues that are exceptions to the norm.

Question 13

To be effective in detecting and correcting unacceptable performance, a control system must satisfy all of the following criteria except which one?

Accepted Answer

A control system does not need to be composed of only objective measures to be effective. It can also include subjective measures, as long as they are relevant and contribute to assessing performance accurately. Objective measures are quantifiable and easy to compare, but subjective measures can provide insights into areas like employee satisfaction, teamwork, and customer service quality, which are also important for organizational success.

Question 14

Jeff Imelt, the CEO of GE, is concerned that his company's control systems measure what is important now and what will be important in the future. Mr. Imelt is concerned that his control systems

Accepted Answer

Control systems should align with the organizational strategy to ensure they measure what is important both now and in the future.

Question 15

Jodi Perkins, a manager for Weststar Inc., is particularly concerned that her control systems use a variety of performance measures that will measure both quantitative and qualitative things. Jodi is concerned that her control systems be

Accepted Answer

Jodi's concern for a variety of performance measures that include both quantitative and qualitative things aligns with the need for control systems to be composed of objective (quantitative) and subjective (qualitative) measures.

Question 16

Which of the following is easiest to measure with a quantitative control measure?

Accepted Answer

Profitability is the easiest to measure with a quantitative control measure because it can be directly quantified through financial metrics such as net income, revenue, and profit margins.

Question 17

__________ is the degree to which a control system provides information when it is needed.

Accepted Answer

Timeliness refers to the degree to which a control system provides information when it is needed, ensuring that data is available to decision-makers in a timely manner.

Question 18

During the busy Christmas season, Randy Thomas is particularly concerned that his control system provide feedback quickly enough for the shelves in his store to be restocked with the appropriate items. Mr. Thomas is concerned that his control system be

Accepted Answer

Mr. Thomas's concern about the speed at which feedback is provided so that shelves can be restocked quickly points to the need for the control system to be timely. This ensures that the store can respond rapidly to changes in inventory needs, especially during the high-demand Christmas season.

Question 19

The key issue pertaining to the timeliness in feedback reporting is not how fast the feedback information is provided, but whether the information

Accepted Answer

The key issue with timeliness in feedback reporting is ensuring the feedback is provided swiftly enough to allow for a response to any unacceptable deviations. This means the feedback must be timely to be actionable, allowing for corrections or adjustments to be made in response to the feedback. Options B, C, D, and E do not directly address the critical aspect of timeliness related to the ability to respond to deviations.

Question 20

As the level of control efforts __________, undesirable deviations from performance standards will __________. As a consequence, the costs associated with undesirable performance will also __________.

Accepted Answer

As control efforts increase, undesirable deviations from performance standards will decrease, leading to a decrease in the costs associated with undesirable performance.

Quiz 15: Organizational Control in a Complex Business Environment