Chapter 16 - Terms

Question 1

Control

Answer 1

a regulatory process of establishing standards to achieve organizational goals, comparing actual performance against the standards, and taking corrective action when necessary

Question 2

Standards

Answer 2

a basis of comparison for measuring the extent to which various kinds of organizational performance are satisfactory or unsatisfactory

Question 3

Benchmarking

Answer 3

the process of identifying outstanding practices, processes, and standards in other companies and adapting them to your company

Question 4

Cybernetic

Answer 4

the process of steering or keeping on course

Question 5

Concurrent control

Answer 5

a mechanism for gathering information about performance deficiencies as they occur, thereby eliminating or shortening the delay between performance and feedback

Question 6

Feedback control

Answer 6

a mechanism for gathering information about performance deficiencies after they occur

Question 7

Feedforward control

Answer 7

a mechanism for monitoring performance inputs rather than outputs to prevent or minimize performance deficiencies before they occur

Question 8

Control loss

Answer 8

the situation in which behavior and work procedures do not conform to standards

Question 9

Regulation costs

Answer 9

the costs associated with implementing or maintaining control

Question 10

Cybernetic feasibility

Answer 10

the extent to which it is possible to implement each step in the control process

Question 11

Bureaucratic control

Answer 11

the use of hierarchical authority to influence employee behavior by rewarding or punishing employees for compliance or noncompliance with organizational policies, rules, and procedures

Question 12

Objective control

Answer 12

the use of observable measures of worker behavior or outputs to assess performance and influence behavior

Question 13

Behavior control

Answer 13

the regulation of the behaviors and actions that workers perform on the job

Question 14

Output control

Answer 14

the regulation of workers’ results or outputs through rewards and incentives

Question 15

Normative control

Answer 15

the regulation of workers’ behavior and decisions through widely shared organizational values and beliefs

Question 16

Concertive control

Answer 16

the regulation of workers’ behavior and decisions through work group values and beliefs

Question 17

Self-control (self-management)

Answer 17

a control system in which managers and workers control their own behavior by setting their own goals, monitoring their own progress, and rewarding themselves for goal achievement

Question 18

Balanced scorecard

Answer 18

measurement of organizational performance in four equally important areas: finances, customers, internal operations, and innovation and learning

Question 19

Suboptimization

Answer 19

performance improvement in one part of an organization but only at the expense of decreased performance in another part

Question 20

Cash flow analysis

Answer 20

a type of analysis that predicts how changes in a business will affect its ability to take in more cash than it pays out

Question 21

Balance sheets

Answer 21

accounting statements that provide a snapshot of a company’s financial position at a particular time

Question 22

Income statements

Answer 22

accounting statements, also called “profit and loss statements,” that show what has happened to an organization’s income, expenses, and net profit over a period of time

Question 23

Financial ratios

Answer 23

calculations typically used to track a business’s liquidity (cash), efficiency, and profitability over time compared to other businesses in its industry

Question 24

Budgets

Answer 24

quantitative plans through which managers decide how to allocate available money to best accomplish company goals

Question 25

Zero-based budgeting

Answer 25

a budgeting technique that requires managers to justify every expenditure every year

Question 26

Economic value added (EVA)

Answer 26

the amount by which company profits (revenues minus expenses minus taxes) exceed the cost of capital in a given year

Question 27

Customer defections

Answer 27

a performance assessment in which companies identify which customers are leaving and measure the rate at which they are leaving

Question 28

Value

Answer 28

customer perception that the product quality is excellent for the price offered