unit 3 management activities - control

Question 1

what is controlling ?

Answer 1

management activity of ensuring goals are met. compares actual outcomes with intended outcomes to see if it is line with targets and examines reasons for possible variations

Question 2

what is stock control ?

Answer 2

concerned with keeping optimum stock levels so the business doesn’t have too much or too little stock to satisfy consumer demand

Question 3

what is effective stock control ?

Answer 3

having optimum levels of stock in your business to meet the needs of your consumers, while at the same time keeping them to minimum. this leads to efficiencies within the business as you have the right level of stock, in the right place, at the right time to meet production requirements and to satisfy consumer demand

Question 4

how does stock control achieve efficiencies ?

Answer 4

• eliminating costs associated with carrying too much or too little stock i.e high storage + admin costs
• eliminating production stoppages due to a lack of raw materials and components for production
• eliminating lost sales orders because of a lack of finished goods for sale

Question 5

what is quality control ?

Answer 5

concerned with checking/ reviewing/ inspecting work done to ensure it meets the required quality standards of the business this could involve physical inspections, etc

Question 6

how does quality control achieve efficiencies with a business

Answer 6

constantly high quality products being sold, resulting in repeat purchasing, consumer loyalty and the ability to charge more for products

Question 7

how does a business achieve quality control - inspections

Answer 7

use trained inspectors to carry out tests on the finished goods

Question 8

how does a business achieve quality control - quality circles

Answer 8

a group of factory floor employees volunteer to become part of the quality circle. they meet to discuss quality issues

Question 9

how does a business achieve quality control= quality awards

Answer 9

awards given by independant organisatins when a business achieves an agreed quality standard
- Q mark
- bord bia quality quality mark
- ISO 9000 series

Question 10

what is financial/ budgetary control ?

Answer 10

the aim of financial control is to ensure overall profitability and liquidity of a business. financial control involves preparing cash flow budgets,ratio analysis and employing cost control measures( utilities, wages). this can provide early warning of possible financial problems

Question 11

what is credit control ?

Answer 11

this means controlling the amount of credit and payment period given to customers. good credit control ensures payments are made in full and on time. it involves checking credit worthiness of customers, setting credit credit limit, credit periods and deciding penalties for late payment. it seeks to minimise bad debts

Question 12

minimising bad debts- assess customers credit worthiness

Answer 12

the credit worthiness of potential customers is checked in advance eg bank references, trade references and credit bureau

Question 13

minimising bad debts- set appropriate credit limit and period

Answer 13

draw up clear terms and conditions controlling the amount of credit and ensuring that payments are made in full and on time eg a credit limit of €5000 and a time limit of one month

Question 14

minimising bad debts- offer incentives

Answer 14

cash incentives such as a cash discount for early or prompt payment

Question 15

minimising bad debts- policy for late/ partial payments

Answer 15

agreeing on penalties for late payments and implementing them eg charging interest n overdue accounts

Question 16

minimising bad debts- have an efficient administrative system

Answer 16

where invoicing, payment demands and follow up phone calls and visits occur promptly to ensure payment / take legal action or threaten legal action to ensure payment. put credit facility on hold until account is cleared

Question 17

minimising bad debts- cash only

Answer 17

adopt a cash only policy with certain customers