Read the following passage and answer the question.

Raj is working on the post of manager in a big company of Pune. He has fixed standards for all the workers in his department. All the workers know the basis on which their future promotion will be done. For higher chances of promotion, they continue make efforts to give better performance. Raj personally observes the subordinates to evaluate the performance. When Raj was controlling his department, he was aware that controlling all the activities was neither easy nor economical. So, he focussed his attention only on the key result areas. After measurement of performance of all departments, his department's performance turned out to be the best of all. The company honoured Raj for his good performance.

After measurement of performance of all departments, his department performance turned out to be the best of all.

Identify the stage of controlling process at which performance is measured?

2nd

The correct answer is option 2- 2nd.

At the 2nd stage of controlling process performance is measured.

Controlling is a systematic process involving the following steps.

1. Setting performance standards- : The first step in the controlling process is setting up of performance standards. Standards are the criteria against which actual performance would be measured. Thus, standards serve as benchmarks towards which an organisation strives to work.

2. Measurement of actual performance- Once performance standards are set, the next step is measurement of actual performance. Performance should be measured in an objective and reliable manner. There are several techniques for measurement of performance.

3. Comparison of actual performance with standards- This step involves comparison of actual performance with the standard. Such comparison will reveal the deviation between actual and desired results. Comparison becomes easier when standards are set in quantitative terms.

4. Analysing deviations- Some deviation in performance can be expected in all activities. It is, therefore, important to determine the acceptable range of deviations. Also, deviations in key areas of business need to be attended more urgently as compared to deviations in certain insignificant areas.

5. Taking corrective action- The final step in the controlling process is taking corrective action. No corrective action is required when the deviations are within acceptable limits. However, when the deviations go beyond the acceptable range, especially in the important areas.