In a marketing firm, the Financial Manager pays more attention towards an increase of 3% in the marketing cost as compared to a 15% increase in the courier expenses.

Identify the concept being used by the manager.

Critical point control

The correct answer is option 2- Critical point control.

The idea is to focus on specific areas or "critical points" that have a significant impact on the overall performance or outcomes. This approach emphasizes monitoring and managing aspects of operations that are crucial to achieving the desired objectives or maintaining financial stability.

Critical Point Control: It is neither economical nor easy to keep a check on each and every activity in an organisation. Control should, therefore, focus on key result areas (KRAs) which are critical to the success of an organisation. These KRAs are set as the critical points. If anything goes wrong at the critical points, the entire organisation suffers. For instance, in a manufacturing organisation, an increase of 5 per cent in the labour cost may be more troublesome than a 15 per cent increase in postal charges.