Business Studies XII Content
Chapter 12 » Process of Controlling | Business Studies – XII
1. Establishing or setting standards– the first step of controlling is to set standard against which results can be measured. For setting standard, targeted results must be identified and it should be quantitative as far as possible. Quantitative term can make controlling effective. Standards are expressed in general term as
a. Cost should be reduced
b. Orders should be executed
c. Overhead must be reduced
d. All orders must be executed in 2 days or so on.
Standards can be expressed in qualitative as well as qualitative terms. The quantitative are physical standard, cost and revenue standards, capital standards etc. the qualitative standards are related to employees morale, motivation, relations between superior and subordinates and public etc. quantitative standard should be flexible.
2. Measuring actual performance– in this step, actual performance of employees, group or units is measure. A manager should examine actual performance on the basis of given standard which id definite set of work assigned to definite employees different techniques can be used to measure the actual performance. In convenience of manager, he develops better information system to measure the actual performance. Actual performance measurement system should be a regular and constant basis so that it can provide reliable and regular feedback to the management.
a. Revision of standard if they seem to be unattainable
b. Revision of strategies, policies and procedures
c. Additional employees training
d. Greater motivation
e. Change in the existing technique of direction
f. Product design improvement