Uncontrollable external factors can create challenges in measuring the results for which managers should be held responsible. Which of the following is the best example of an uncontrollable external factor for a manager who oversees all of the operations for a business?
A)Production volumes were above normal levels so that overtime was paid to direct labour employees
B)Poor quality direct materials were purchased so more materials than usual were required in the manufacturing process
C)Raw materials prices changed because of a change in environmental laws
D)Utilities costs were higher than normal even though weather and usage were typical for that time of year

Question

Quizplus · Accepted Answer

Raw materials prices changing due to external factors such as changes in environmental laws is an example of an uncontrollable external factor. The manager has no control over these external changes and the impact they have on the business. The other options (A, B, and D) are related to internal operations and can be influenced by managerial decisions and actions.

Uncontrollable External Factors Can Create Challenges in Measuring the Results