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Module 7 Lesson 2 Assignment 2

Sam established standards to measure performance towards his goal of increasing revenue by $100,000. He set repair quotas for mechanics and introduced customer satisfaction surveys. Sam then compared actual performance to the standards each month by reviewing receipts, income statements, and survey results. When he found deviations from the goals, Sam took corrective actions like reviewing the standards and considering other ways to increase revenue. Through this controlling process, Sam could determine if plans were working and make adjustments to keep the business on track to meet its financial targets.

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90 views2 pages

Module 7 Lesson 2 Assignment 2

Sam established standards to measure performance towards his goal of increasing revenue by $100,000. He set repair quotas for mechanics and introduced customer satisfaction surveys. Sam then compared actual performance to the standards each month by reviewing receipts, income statements, and survey results. When he found deviations from the goals, Sam took corrective actions like reviewing the standards and considering other ways to increase revenue. Through this controlling process, Sam could determine if plans were working and make adjustments to keep the business on track to meet its financial targets.

Uploaded by

Michelle Alday
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Module 7 Lesson 2 Assignment 2

Watch the video presentation on controlling. What have you learned from the video?

What I have learned in the video is that in a business there is a lot of techniques to increase the
performance of the company in terms of revenue. What Sam did was great. He followed the Controlling
Process Steps in Business Management. By using a controlling process, a company can navigate changes
to the supply chain, customer demand and other variables that impact a company’s livelihood. It’s a
critical task in keeping any business solvent. Through the process of controlling in management, a
company can accurately tell if plans are moving in the right direction and are fully implemented. If those
plans aren’t working and take the company off-track, they can right the ship and stay on course.

First, Sam he established a standard to measure performance because Sam wants to make a hundred
thousand dollars more this year than he did last year so he can replace the older equipment in the repair
shop. You need a goal for your business, but you also need guidance for your team to keep them
working towards that goal. Without such standards, it’s possible that they’ll move away from the plan,
whether intentionally or not. Standards are like goals that are tasked to a specific department or team
member. They must achieve these standards through cooperation, teamwork and a collaborative effort.
To ensure these standards are being met, though, you must-have criteria to measure them by. By setting
up rules you can measure with, you can judge or rate performance to keep the results standard. This
helps management understand how production is progressing, and whether it’s on track or needs
adjustment. Having standards to base performance on means that work doesn’t have to stop to get a
picture of how it’s progressing. There are two groups of standards: tangible (or specific) and intangible
(or abstract). The former is measurable; you can see it and count it. The latter cannot be seen nor
counted. A tangible standard would be time, cost, profit, expenditure, output, etc. Intangible standards
are a manager’s performance, worker’s attitude and so forth. Second, Sam presented a new pricing
guide to employees he explains his plan for raising much needed revenue to each employee so the
employee understands the reason for the price increase. It is important to include employees in setting
goals if Sam’s employees understand the reason for the price increase they will be more likely to buy
into the goal. Sam also introduces the customer satisfaction survey to his customers each customer will
fill out a survey in where they will rate their experience based on many factors like timeliness of repairs,
quality of work, price, friendliness of mechanics and ease of payment. Sam also has to develop a way to
measure how many cars are being repaired by each mechanic on a weekly basis to be sure that the
amount of repairs done weekly, monthly and in a year add up to the desired goal of increasing revenue
by a hundred thousand dollars set forth above. He introduces the mechanics to a repair quota system
each mechanics must fix 10 engines patch 5 tires and replace 15 windshield wipers each week that
means that each mechanic must bring in about 280 dollars in revenue each week to reach the goal once
broken down for the mechanics the goal is realistic and attainable. Setting a standard makes it possible
to measure performance using a control function. Through this measurement of performance, you can
quickly catch and correct any deviation from the plan before it goes off-track and runs production into
the ground. measurements are easier when dealing with tangible standards that can be seen and
counted. This is naturally more difficult with intangible standards. By definition, intangible performance
is difficult to measure in an information system, as you cannot quantify it. Third, Sam comparing
performance with the standard, he reviews his repair receipts and income statement each month to be
sure he is on target for his financial goal of increasing revenue by a hundred thousand dollars. Sam also
review the customer satisfaction surveys each week he documents the percentages in his worksheet he
compares each survey percentage change with that of the previous year to determine whether there are
positive changes in customer satisfaction. Once you have a baseline for how your teams are performing
when manufacturing, packaging, delivering, etc., you can compare the actual to the planned
performance and determine the extent of the deviation. This is called variance, or the difference
between actual performance and goals. Schedules can be immensely helpful when it comes to analyzing
variance. Since everything didn’t work the way the goal is set Sam needs taking corrective action. He
needs to review all the standard he sets, think other way to achieve his goal of more revenue this year.
Once you have analyzed the deviation and determined its cause, the manager will have to set up a plan
in which corrective measures, critical point control and other means are used to resolve the issue. This is
to reduce the deviation and ensure the standard is met. This might involve changes to processes and/or
behaviors. Some of the situations discovered in a controlling process might require corrective action to
save the business, while others might just be a below-standard performance that needs correcting to
improve processes and bring production back on schedule. Therefore, actions might be needed
immediately because of the urgency.

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