Chapter 16: Control Systems and Quality Management

Question 1

Which management function is involved with monitoring performance, comparing it with goals, and taking corrective action as needed?

Answer 1

Controlling

Question 2

When Jensen asked his boss, “How many books do we want to sell by November?” he was trying to establish a(n) _____

Answer 2

control standard

Question 3

Samira receives a written report every six months detailing the production outputs of the warehouse. These reports demonstrate which step in the control process?

Answer 3

measure performance

Question 4

At the end of the year, Kavita compares each employee’s performance to the standards that were set at the beginning of the year. Which step of the organizational control process does this exemplify?

Answer 4

Third

Question 5

The purpose of _____ is to monitor performance and take corrective action as needed to ensure that objectives are met

Answer 5

controlling

Question 6

What is the first step of the control process?

Answer 6

Establish performance standards

Question 7

What is the second step of the control process?

Answer 7

Measure performance

Question 8

When comparing performance to standards, the acceptable amount of deviation depends on:

Answer 8

the range of variation stated in the first step

Question 9

Which management function is involved with monitoring performance, comparing it with goals, and taking corrective action as needed?

Answer 9

Controlling

Question 10

The _____ perspective of the balanced scorecard asks the question, “How do we look to our shareholders?”

Answer 10

financial

Question 11

Sonja is a barista. Her manager has been hearing reports that Sonja’s lattes taste like the milk is burned. Her manager talks to Sonja about these reports and shows her some tricks for steaming the milk to the correct temperature. This is an example of which type of control?

Answer 11

Feedback

Question 12

As a property manager for a large office complex, Alisha develops a projection of the costs that will be incurred over the next 12 months, such as landscape expenses, snow removal, insurance, and repairs. Alisha has prepared a(n) _____

Answer 12

budget

Question 13

The _____ approach gives upper management a quick but thorough view of the organization via four indicators: customer satisfaction, internal processes, innovation and improvement activities, and financial measures.

Answer 13

balanced scorecard

Question 14

Using the previous budget as a starting point and making adjustments to the funds allocated to each expense category is the budgeting approach known as _____ budgeting

Answer 14

incremental

Question 15

The perspective in the balanced scorecard approach that is concerned with the shareholders’ view of organizational performance, such as market share, revenue growth, and stock price, is known as the _____ perspective

Answer 15

financial

Question 16

A(n) _____ is a formal financial projection that states an organization’s planned activities for a given period of time in quantitative terms

Answer 16

budget

Question 17

Which type of budgeting allocates increased or decreased funds to a department by using the last budget period as a reference point?

Answer 17

Incremental

Question 18

A(n) _____ budget is where resources are allocated on a single estimate of costs, also known as a static budget, and that budget amount cannot be adjusted over time

Answer 18

fixed

Question 19

One problem with incremental budgets is:

Answer 19

inflexibility

Question 20

Nicole has enough money in her budget to allow her to hire temporary help for the holiday rush. What type of budget does this represent?

Answer 20

Variable

Question 21

A fixed budget, also known as a static budget, has resources allocated on a single estimate of costs. That budget amount _____

Answer 21

cannot be adjusted over time

Question 22

A summary of some aspect of an organization’s financial status such as a balance sheet and an income statement is a _____

Answer 22

financial statement

Question 23

A budget in which the allocation of resources fluctuates in proportion to different levels of activity during the budget period is known as a(n) _____ budget

Answer 23

variable

Question 24

Greg prepares a financial statement for his business, listing the company’s current assets, fixed assets, and the debts that are owed to suppliers and lenders. What document is Greg preparing for his business?

Answer 24

Balance sheet

Question 25

A(n) _____ summarizes an organization’s financial results (revenues and expenses) over a specified period of time, such as a quarter or a year

Answer 25

income statement

Question 26

Resources that an organization controls, such as cash, inventory, and accounts receivable, are classified on the balance sheet as _____

Answer 26

assets

Question 27

Debts or claims by suppliers and lenders against the assets of a company are classified as _____ on the company’s balance sheet

Answer 27

liabilities

Question 28

Assets resulting from the sale of goods and services are known as _____

Answer 28

revenues

Question 29

A firm’s _____ statement summarizes its financial results (revenues and expenses) over a specified period of time, such as a month, quarter or year

Answer 29

income

Question 30

Dicte has a small business making beaded jewelry. The costs of purchasing the beads, semi-precious stones, clasps, and other supplies used to make the jewelry and the rent on her store are the _____ of her business, whereas the assets resulting from the sale of her jewelry are the business’s _____

Answer 30

expenses; revenues

Question 31

The _____ perspective on the balanced scorecard approach focuses on the analysis of different types of customers, their level of satisfaction, and the processes used to deliver products and services to customers

Answer 31

customer

Question 32

Which report summarizes the overall financial worth of an organization, such as assets and liabilities, at a specific point in time?

Answer 32

Balance sheet

Question 33

Which balanced scorecard perspective asks the question, “At what must we excel?”

Answer 33

The internal business perspective

Question 34

Assets not easily converted to cash, such as property, buildings, and equipment, are classified on a firm’s balance sheet as _____ assets

Answer 34

fixed

Question 35

Which balanced scorecard perspective asks the question, “How do customers see us?”

Answer 35

The customer perspective

Question 36

Productivity is defined by the formula of outputs divided by _____ for a specified period of time

Answer 36

inputs

Question 37

The _____ perspective of the balanced scorecard approach examines such metrics as productivity, efficiency, quality, and safety

Answer 37

internal business

Question 38

The costs required to produce the goods or services of the organization are known as _____

Answer 38

expenses

Question 39

The balanced scorecard perspective that assesses whether or not the organization encourages employees to make suggestions and question the status quo is known as the _____ perspective

Answer 39

innovation and learning

Question 40

Outputs divided by inputs over a specific period of time equals _____

Answer 40

productivity

Question 41

A visual representation of the four perspectives of the balanced scorecard that enables managers to communicate their goals so that everyone in the company can understand how their jobs are linked to the overall objectives of the organization is called a _____

Answer 41

strategy map

Question 42

Two ways for a company to guarantee quality of a product are quality control and quality _____

Answer 42

assurance

Question 43

Which perspective in the balanced scorecard approach addresses how the organization can continue to improve?

Answer 43

Innovation and learning perspective

Question 44

Which philosophy proposed ideas for making organizations more responsive, more democratic, and less wasteful?

Answer 44

Deming management

Question 45

A _____ map is a visual representation of the four perspectives of the balanced scorecard that enables managers to communicate their goals so that everyone in the company can understand how their jobs are linked to the overall objectives of the organization

Answer 45

strategy

Question 46

Which approach is a comprehensive approach, led by top management and supported throughout the organization, and dedicated to continuous quality improvement, training, and customer satisfaction?

Answer 46

Total quality management

Question 47

The ability of a product or service to meet customer needs refers to _____

Answer 47

quality

Question 48

Deming management proposed ideas for making organizations more responsive, more democratic, and _____

Answer 48

less wasteful

Question 49

The focus of total quality management (TQM) is _____, training, and customer satisfaction

Answer 49

continuous quality improvement

Question 50

The two core principles of TQM are _____ orientation and _____ orientation

Answer 50

people; improvement

Question 51

The four components of _____ are to make continuous improvement a priority, get every employee involved, listen to and learn from customers and employees, and use accurate standards to identify and eliminate problems

Answer 51

total quality management

Question 52

Since service industries do not produce a tangible product, often customer satisfaction may be a matter of _____

Answer 52

perception

Question 53

What is defined as the subcontracting of services and operations to an outside vendor?

Answer 53

Outsourcing

Question 54

The two core principles of total _____ management are people orientation and improvement orientation

Answer 54

quality

Question 55

Using robots to paint products on a 24-hour basis rather than using humans, who require downtime for personal breaks, would result in _____

Answer 55

reduced cycle time

Question 56

Statistical process control is a statistical technique that uses ______ from production runs to see if quality is being maintained within a standard range of acceptability

Answer 56

periodic random samples

Question 57

Halimax has recently been hired by numerous city governments to handle security at major sporting events. The hiring of Halimax rather than relying on the city police force is an example of _____

Answer 57

outsourcing

Question 58

The acceptable threshold for quality defects according to Six Sigma standards is 3.4 defects per _____ products or procedures

Answer 58

1,000,000

Question 59

Reduced cycle time is the direct result of _____

Answer 59

decreasing the steps in a work process