Introduction To find out whether or not Mr. Gonzales should implement the new compensation plan, we will initiate with a valuation of the proposed bonus plan that he is considering. This evaluation will include an analysis of the key decisions and the persons responsible for making the decision as well as a discussion of the proposed plan. Upon this analysis we will conclude whether it is a good idea to implement it and state our suggestions for a modification of the plan. Valuation of the proposed bonus plan Included in the new bonus plan are the store managers (SM), the regional managers (RM), and the corporate staff managers (CM). Not included are the CEO (Mr. Gonzalez) and the COO; their bonuses would be decided by the compensation committee of the board of directors. Furthermore all other employees not included in the plan would continue as before with a bonus in the range of 2%-5% of base salary. Each of the company’s 82 stores is operated by a SM, who has a lot of autonomy. The 82 store are organized into 9 geographical regions. The RMs are responsible for providing oversight and advice to the SMs, whom had little formal education. On the top of these two manager levels are the CMs, who are responsible for a range of centralized functions including purchasing, human resources, marketing, real estate, and investor relations. The proposed bonus plan consists of 4 million pesos plus 8 percent of the corporate income before bonuses and taxes in excess of 120 million pesos. The total bonus pool will be divided between the managers as following: SMs – 70%, RMs – 15%, and CMs – 15%. This year, the bonus pool will amount to 8,498,400 million pesos (all calculations: cf. the calculations for the Whiz Kids questions on the ... ... middle of paper ... ... 8.498.400 The bonus pool is then divided between the different groups: Store Managers : 70%*8.498.400 = 5.948.880,00 Regional Managers : 15%*8.498.400 = 1.274.760,00 Corporate Managers : 15%*8.498.400 = 1.274.760,00 To find the average amount per manager we divide the pools by the number of managers in the specific group Store Managers : 5.948.880/82 = 72.547,32 Regional Managers : 1.274.760/9 = 141.640,00 Corporate Managers : 1.274.760/5 = 254.952,00 The bonus pool for the top performing store managers: Total units in the bonus plan 6*1+9*2+11*3+20*4+15*5+8*6+4*6+3*6 = 302,00 Average pay per unit : 5.948.880/302 = 19.698,28 Store top performing managers (6 units) = 118,189,68
The company offers a Store Manager position in a boutique. He/she should drive a goal oriented team. The vital purpose is to do all the processes such as store operation. Hence, to lead, control and mentor assistant managers, visual managers, and all the employees.
M&S are one of the UK's leading retailers of clothes, food, home products and financial services. Some 10 million people shop with us each week in over 375 stores. In addition M&S have 155 stores managed under franchise in 28 territories mostly in Europe, the Middle East, Asia and the Far East, stores in the Republic of Ireland, nine wholly owned stores in Hong Kong and M&S own the US supermarket group, Kings Super Markets. The main objectives of marks and Spencer's are as follows:
The emergency rescue of the Royal Bank of Scotland in 2008 has cost the UK government thus the British taxpayer a huge amount of money. Many people are upset about the high bonuses the RBS management board have received, both because of the outrageously high amount and because the performance of the bank on the long-term was not good at all. According to the agency theory managers do not always act in the interest of the shareholder, but often act in the interest of themselves. The downfall of RBS could have been prevented if managers were not paid out a bonus based on their performance of one year, but rather a combination of a bonus based on their performance of multiple years and a bonus ...
Employees protested, “that supervisors should have received a reduced bonus because they were not working as hard as they are and the company might be playing with the numbers” (Beer & Collins, 2008 p.6). A beneficial system for the new Scanlon Plan is to rearranged payout count. This will help to regain trust amongst employees and management. Equity Theory stresses integrity to all compensation arrangement and if this is effectively executed, then this will resolve the mistrust issue that employees have with their management team. The rewards should not be paid on a consistent month-to-month basis, instead, on a settled proportion plan, which gives rewards "each nth time the right behavior is demonstrated" (Bauer and Erdogan, 2013, p. 112). Traditionally, this would imply that workers are paid reward each time a specific measure of cash in permitted payroll is met. “The current permitted payroll is at 38% of sales value” (Engstrom, 2008). This requires no change. Instead, when Engstrom comes to a permitted payroll of one million dollars, then 10% of that sum should naturally disbursed to workers as rewards. This tackles numerous past issues with the Scanlon
What amount of compensation expense should Murray recognize in the years ended December 31, 2008, 2009, and 2010?
Item 6.b. Discuss and Action Director’s Compensation. After discussion, there was a motion by Director Cooke and seconded by Director Wilson to approve increase of stipend to $200 per meeting, annual meetings increased to 72 annually and 6 meetings per month maximum. In addition, on an annual basis the board would like to increase stipends based on the Consumer Price Index (CPI) rate but not more than a 5% increase. The District attorney will verify if this can be done. The vote was as follows:
Management should share the responsibility with employees to calculate how fast bonuses are generated and earn. This may be a sensible strategy explained by the Vroom 's Expectancy theory; which suggest that people will be motivated to accomplish an objective if they feel it benefits them and also help accomplish the objective. Thus, the employees feel a significant worth of respect, and their sense of liberty increases. The modification to the Scanlon Bonus Plan directly relates to the motivation of employees and has them embrace the social system they operate in at the organization. These adjustments of the Scanlon Bonus Plan straightforwardly identifies with the motivation of employees and how they embrace the social
Contemporary management of the business. 7 ed. of the book. New York, NY: McGraw-Hill. McComb, S., Schroeder, A., Kennedy, D., & Vozdolska, R. (2012).
...ast years. It is important to establish a well-designed performance measurement system and employee bonus plan at BTH. A good bonus/incentive plan will not only increase the productivity but also improve the quality.
Johnson, Sam T. "Plan your organization’s reward strategy through pay for performance dynamics: Compensation & Benefits Review 30, Number 3: (May/June 1998): 67-72
Within the sales division of Frito-Lay the management system runs as a chain of command with the sales representative being the last line of defense between the company and the customer. The sales representative receives his sales plans and product placement orders form the district sales leader who receives his orders from the zone sales manager and so on up the chain. Ultimately the role of increasing sales and product recognition rest on the shoulders of the sales representative.
The committee must be given authority to establish remuneration packages for directors within the upper and lower limits. These ceilings and floors must be duly approved by the shareholders in AGM in advance.
...lexibility and is geared towards adaptation and change. The environment is constantly changing and is very unstable so a structure that provides ease of customer service is one to adopt. With making the choice I risk once again the produce and meat managers possibly operating as a separate entity, but I have also empowered my store manager to make all decisions so it will be his responsibility to communicate and remind everyone that even though there are departmental groupings at the end of the day everyone one is a part of that C & C store. It is also his duty to enforce customer service because all they see if the final output. For instance, C & C customers are accustomed to superior quality of meat and produce and that is what their loyalty is centered around. Adopting a better structure is to generate healthier internal environment but not decrease on output.
Managerial decisions are an important component in achieving the objectives of the organization. The success or failure of a business depend upon the decisions made by managers (Jurina, 2011). Today’s increasing complexity in the world of business brought forth greater challenges for both the firm and its managers. The rapid rate of technological and digital advance as well as greater focus product innovation and processes that influence marketing and sales techniques have contributed to the increasing complexity in the business environment.
This report will give us a clear perspective as to what the optimal organizational structure that suits Rendell Company plus some additional control system in attaining the company’s main objectives. We will be also tackling the roles, functions and responsibilities of a controller in an organization. This case takes us into Rendell Company which is currently having problems between the corporate controller and the divisional controller. We assessed the advantages and disadvantages of the organization structure of Martex whether it can be applied and be implemented to Rendell Company in order to resolve the problem. Through the frameworks and issues, we concluded that while current setup would cause some budgetary discrepancies because of the lack of loyalty between the divisional controllers to the corporate controller, changing the organization structure of Martex would cause a disparity between the division manager and the divisional controller thus resulting in an anxiety in their working environment which is too costly as compared to maintaining the current setup.