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CSEET · Business Laws and Management · Management Knowledge for Company Secretaries

At Sundaram Textiles, the production head found that actual output for the month was 8,000 units against a standard of 10,000 units. He investigated, found that machine breakdowns caused the shortfall, and had the machines serviced and a maintenance schedule introduced. Which steps of the control process did he carry out after measuring actual performance?

He compared actual output with the standard, analysed the deviation, and took corrective action. The 2,000-unit shortfall was traced to machine breakdowns and addressed by servicing and maintenance scheduling. Standards were already set and were not revised, so the other options are wrong.

  1. ASetting standards and then measuring performance
  2. BComparing actual with standards, analysing deviations and taking corrective actionCorrect
  3. COnly taking corrective action, since the deviation was obvious
  4. DRevising the standard downwards to match actual output

Explanation

After measuring actual output, he compared it with the standard of 10,000 units and found a 2,000-unit deviation. He then analysed its cause, machine breakdowns, and took corrective action through servicing and a maintenance schedule. Standards had already been set, and he did not lower them.

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