'A.S. Ltd.' is a large company engaged in assembly of air-conditioners. Recently the company had conducted the 'Time' and 'Motion' study and concluded that on an average a worker can assemble ten air-conditioners in a day. The target volume of the company in a day is assembling of 1,000 units of air-conditioners. The company is providing attractive allowances to reduce labor turnover and absenteeism. All the workers are happy. Even then the assembly of air-conditioners per day is 800 units only. To find out the reason the company compared actual performance of each worker and observed through C.C.T.V. that some of the workers were busy in gossiping.
(a) Identify the function of management discussed above.
(b) State those steps in the process of the function identified which are discussed in the above paragraph.

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Solution

(a) The function of management discussed in the above case is Controlling.
(b) The steps discussed in the above paragraph are:
(i) Setting performance standards: The first step in the controlling process involves setting standards in clear, specific and measurable terms. Standards can be set in both quantitative as well as qualitative terms.
(ii) Measurement of actual performance: The next step relates to the measurement of actual performance. Performance should be measured in an objective and reliable manner. As far as possible, performance should be measured in the same units in which standards are set as this would make their comparison easier.
(iii) Comparison of actual performance with standards: This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation and noting deviations if any. If the actual performance is more than planned performance deviations are said to be positive or vice-versa.
(iv) Analysing Deviation: With the comparison of actual performance with the set standards, deviations in performance are identified.
(v) Taking corrective action: This is the final step involved in the controlling process. When the deviations are within acceptable limits no corrective action is required. Corrective action might involve training of employees, buying new machinery, increasing supervision and so on.

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