Definition and Meaning of Leadership Research Paper

Definition and Meaning of Leadership - Research Paper Example Moreover, Kurt Lewin defined leadership as the "manner and approach of providing direction, implementing plans, and motivating people" (271-299). In the Army, leadership is defined as "influencing people by providing purpose, direction, motivation while operating to accomplish the mission and improving the organization." According to Patterns of Aggressive Behaviours, there was a group of researchers that identified different styles of leadership (271-299). Lewin's study recognized there major styles of leadership that have been very influential: 1) autocratic, 2) democratic, and 3) delegate. Groups of school children were allotted to one or three groups where researchers have observed their behaviors in response to the different styles of leadership. The autocratic or authoritarian leadership is well applied to conditions where there is limited time for group decision-making and the leader is the most educated and experienced member of the group (Lewin, 271-299). There is a clear distinction between the role of the leader and the followers. Authoritarian leaders make independent decisions with very little or no input from the rest of the group of what needs to be done when it should be done, and how it should be done. Thus, it was concluded by researchers that decision-making in authoritarian leadership was less creative. Lewin stated that moving from an authoritarian style to a democratic style is more difficult than vice versa. The abuse of this kind of leadership is viewed as controlling, bossy and dictatorial. The authoritarian style is usually used by leaders when employees need close supervision to carry out certain tasks. It occurs when leaders tell their employees what they want doing and accomplished, without getting the opinion of their followers. According to Lewin, participative leadership or the democratic kind, on the other hand, has a leader who encourages group members to participate and give their inputs (271-299). Lewin observed that members of the participative group were less productive than the members of the authoritarian group through the inputs were of higher quality and the members feel much more motivated and creative. A participative leadership style is where the leader, including one or more employees, are engaged in the decision-making process. Normally, this happens when the leader has a part of the information and the employees have the other parts. The leader and the employees work closely together to accomplish certain tasks. However, the leader maintains the final decision-making authority which the employees must learn to respect. Â  

Business valuation Essay Example for Free

Business valuation Essay †¢One of your friends uses the terms ethics and morality interchangeably. You do not think this is correct. How would you explain the difference between ethics and morality? Provide an example of morality and one of ethics in your explanation. Ethics are more about a set of rules for a specific class of people, or a situation. They are more of a set of rules. While morals are more about an individuals’ set of rules for them, what they hold to be right or wrong that they follow to make decisions or take actions. A good example would be a lawyer who is defending a person who has committed a robbery. The lawyer’s morals tells him that the person is guilty, but his ethics tells him that he must defend the person. †¢Select two major ethical theories covered in your readings for Week One. What are the major differences between these two theories? Which one of these theories best aligns with your personal beliefs? Explain. I choose utilitarian theory and deontological theory. Utilitarian theory is to maximize utility as well as maximize happiness while deontological theory refers to following rules or regulations. Utilitarian can be a scenario where it benefits the individual or group say be given a weekend off even though there is still much work to be done, while within the same scenario the employees could almost be forced to work the weekends, even though they are tired and would like to spend time with their families. I prefer utilitarian as maximizing my happiness is important to me. I have worked with companies predominantly the Navy, whose type of theory is deontological. Duty within the Navy is huge, rules create the structure. Knowing that the happiness of myself and my family are a huge part of my determination when making the decision to take a job. †¢What are examples of virtues, values, and moral concepts? How do each of these relate to one another? In what ways are they separate and in what ways are they connected? Virtues are a person’s thoughts and/or actions that are guided by are morals, are morals are what we hold to be true ranging from honesty to being faithful, while are values are simply what he hold to be valuable. They all go together like cogs, working together to reach the same goal, but if one is not there then the whole thing will not work. They are separate because they’re all slightly different, say like parts of a car engine, and yet they are all required in order for the engine to work. If one is not present the engine will not work. †¢In Ch. 6 of Basic Ethics, the author discusses the relationship of religion as it relates to morality and ethics. Using your own personal experiences as a resource, what, if any, relationship exists between religion, morality, and ethics? Explain your answer. †¢Select a public figure from politics or business. Select an ethical theory that seems to best fit this person. Why does this theory seem best? Which theory seems to least suit this person? Why? Hilary Clinton, she would highly appear to follow a deontilogical ethical theory. It seems to suit her and her political career nicely, it just does not seem to be in the best interest of the citizens. Following utilitarianism she would be putting the happiness of the voters and citizens either above her own or at the very least equally. †¢If a person is described as virtuous, is this the same as saying that person is moral or ethical? Why or why not? How would you explain the relationship between these three concepts? Provide examples. If one has to be called ethical or moral I would not say that it means that they are virtuous, but I would say that if someone has to be called virtuous that they would be both ethical and moral. Being virtuous means having or showing high moral standards, so to be virtuous means one would have to have high ethics and high morals. The three work together, morals is doing what is right, ethics is moral principles that govern a persons or groups behavior, and being virtuous is a combination of these two as well as going above and always being moral.

Business Level Strategy In The Market Commerce Essay

Business Level Strategy In The Market Commerce Essay Business level strategy concentrates on developing a firm specific model that will allow the firm to gain competitive advantage over its rivals in the industry such as in which it operates. Business strategy would focus on improving its competitive position of a companys or business units products within the specific industry or market segment that the company and/ or its business units serve. The question explored in business level strategy is: How a company can best be competed in the industry that they are in? For an example Honda motors, Japan has a domestic market for its products and also it operates internationally. Thus business strategy should be crafted focussing on the ways of how it out beat the domestic competitors who operates both in the domestic market and as well as the in the international market like Mazda, Mitsubishi, Daihatsu, Suzuki, Toyota and Nissan and competitors in the international market like General motors, Chrysler, Ford Motors etc. In formulating business level strategies, firm should consider how best it can compete in each of the industries it operates in. Thus business level strategies require crafting the strategy and positioning the firm in each of its business. For an example Honda should formulate a separate business strategy for its motor cycle production section that attempts to add build competitive advantage over rival, motorcycle manufacturers. And there should be another business level strategy for its auto mobile manufacturing division that addresses the ways and means of competing against rival automobile manufacturers and a separate strategy for power products (engines, portable generators, lawnmowers, outbound motors) manufacturing division that attempts to build competitive advantage over power product manufacturers in the industry. Corporate Level Strategy Corporate strategy is to a firms survival and success and it is largely about the choice of the direction for the firm as a whole. I.e. Corporate level strategy describes companys overall direction in terms of its general attitude towards growth and the management of its various business and product lines. Corporate strategy is concerned with two key questions, What business should the company be in to maximize the long term profitability of the organisation? What strategies should it use to enter into and exist from the business area? This is true whether the firm is a small, one product company or a large multi national corporation. Corporate strategy in a multinational company is all about managing various product lines and business units for maximum value. In this instance, corporate head quarters must play the role of the organisational Parent in that it must deal with various products and business unit Children. Even though each product line or business unit has its own competitive or corporative strategy that it uses to obtain its competitive advantage in the market place, the corporation must coordinate these different business strategies in order to be succeeded. For an example Honda Motors, even though there are various competitive or corporative business strategies at various business unit levels, it is the top management that decides the overall direction and goals for the entire organisation. i.e. even though there are several business segments as motor cycle manufacturing, auto mobile manufacturing and power product manufacturing and different competitive or corporative strategies adopted by each of these segments at business level, corporate level strategy for each of these segments all the same. Critically evaluate the process of reconciling dichotomies at Honda Motors with reference to the product-related core competencies versus process -related core capabilities dichotomy. Hondas underlying innovative strategic management process is described as reconciling dichotomies There can be seen number of dichotomies that encompasses management thinking and pass through all the functions and as well as aspects such as buyer supplier relations (e.g. Vertical integration and market relations), work organisation, (efficient and humane), product development processes (simultaneous and sequential development), business strategy (cost and differentiation) etc. These are concerned as paradoxes that should be solved implicitly by the west where as Hondas way of thinking is very different. A dichotomy reconciliation approach exemplifies both the philosophy behind the actual product design and the mental process of technology research. When considering about the product related core competencies in Honda, its adherence to the principle of build in quality has brings forth the competitive advantage to Honda. The build-in quality principle focuses on ensuring the effectiveness of the performance outcome of sub transformation activities. The measure of effectiveness is customer defined standards of performance that can be achieved by breaking down the total standard of performance measures as expected by the customers to number of sub activities where value adding can be realized at every stage of the process in a way that it gives a bigger accrued value by the time of operations process reaches its end. This leads to a reduction in costs and as well as exceed expectations of the customers. In that sense build in quality principle highly emphasis regarding product related capabilities which are measured by the customers eventually. The advance internal combustion engines which power the entire range of Honda products is being regarded as a core competency, which is also a successful reconciliation of dichotomies, deliver direct and immediate competitive advantage for Honda. The right-the-first principle constitute that the result of any process should be free of errors. An error occurred in a particular task necessitate re-working on it before it passed on to next stage of the production process, which may resulted in delaying the entire production process and as well as increasing the operational costs, costs of lost opportunities of sales earned from customers who prefer not to wait and switch to other brands. As such right- the- first principle adopted by Honda, will enhance its operational efficiency by not wasting time and other resources by increasing productivity. More over its introduction of Just In Time production and logistic system leads to more accurate inventory control that save cost further. It can be pointed out as a dichotomy reconciliation that permits both product variety and productive efficiency. Western flawed assumption of management thinking was that the right-first time and the build-in quality is only a dichotomy that takes places only if a substitution of getting the benefits from one at the disbursement of the other is assumed as it is viewed only from a manufacturers perspective, which has to be at least concentrated from a dual perspective, the manufacturer and the customer. If it should be considered from a multiple perspective, taking all partners in the supply chain in to account. Doing things right the first time is a cost savings approach as it helps to eliminate waste and reduce the necessity of reworking. Lower operating costs can transform into higher margins, which will be helpful in attracting customers by offering them the products at a reasonable price and it too will avoid customers from switching to rival brands. Customers not judged a product by concerning only on its quality, but its entire combination that brings forth the benefits and there fore value to them. Thus the features and attributes like delivery time and cost of purchase and ownership are too considered up on. Quality is there fore both process and product dependent. For an example the value of high product quality because of its superior features, characteristics and attributes can be ignored by slow delivery times if things are not done right the first time. Through its wide array of management strategies Honda has shown that the notice of right- first time and build- in quality is not different in nature and does not exist in isolation but are rather similar and complementary processes if the pull strategy is adopted placing customers ahead of else. Question Two: Global Mergers and Acquisitions (MA) Too much Debt and Risk of Bankruptcy Mergers and acquisitions have been the focus of corporate strategies over the last few decades, with an increasing number of mergers across the globe, especially in the automobile industry. A merger or acquisition is a combination of two companies where one corporation is completely absorbed by another corporation. The less important company loses its identity and becomes part of the more important corporation, which retains its identity. Mergers and acquisitions can occur for number of reasons. One such is to overcome too much debt or to avoid bankruptcy situations. Supplier bankruptcies make up the first wave of restructuring and the rate of bankruptcy fillings will continue to accelerate in the near term. As credit becomes more widely available and companies are able to safe and sound liquidity, there will be a wave of Mergers and acquisitions. If a particular company is undergoing enormous debts and finds it difficult to beat competition or even to survive in the industry, management may make a decision to go for a divesture. As a result company may sell out to another corporation or may go for a merger. If a company is suffering from a bankruptcy situation, perhaps it may come to a decision to move for a sell out strategy. Financially viable competitors in the same industry may interested in merging with or acquiring another corporation in the same industry even with huge debts or under a bankruptcy state if there is any potential advantage of merging or acquiring is witnessed. Some times it may be because of the companys ability to produce goods efficiently if they combined their efforts and facilities. These efficiency gains may come simply by virtue of the size of the combined company; it may be cheaper to produce goods on a large scale. Collaborating or sharing expertise may achieve gains in efficiency, or a company might have underutilize assets that the other company can better use or else because of the technology or the brand image or any other unique attribute available to the bankrupt company. Through such merger or an acquisition, the company which suffered from financial difficulties will lessen its burden as it has the ability to overcome its debts as the change in the management may make the company more profitable Potential Product Synergies Automotive mergers and acquisitions act as means of increasing market share, improving reach attaining economies of scale and augmenting product ranges. Automotive mergers are turning into a strategic option for companies looking to accelerate growth. Through mergers or acquisitions companies intended to maximize synergies through their complementary strengths in product line-up, procurement, RD, marketing and personal training which would result in cost reductions, greater global market penetration and other benefits through corporation. As a result of a merger or an acquisition a corporation would get the access to up to the minute technology, a worldwide network and advanced managerial expertise. In addition substantial cost savings have been achieved through a common purchasing strategy and by setting up a common supplier base. Common platforms will be developed to reduce time for new product introduction. Achieving of synergies is the ideal sought in corporate mergers and acquisitions. Synergy refers to an increase in the level of performance of a combined enterprise that will exceed the previous individual performance when it was operated separately. For an example managerial economies such as the increased opportunity of managerial specialisation, technical economies such as technical know how, purchasing economies due to increased order size and associated bulk buying discounts. In automobile industry there are several synergies that can be achieved through mergers and acquisitions. For an example in 1990 Honda entered in to an agreement with Rover under which Honda acquired minority shareholding in Rover in order to begin European production of Honda Accord. And also once Honda rewind its formal relationships had with Rover, BMW acquired Rover Company from its parent company with the expectation of expanding its capacity from 600,000 to 800,000 by 1999 with 150,000 of these vehicles exported. Access to New Technologies and Emerging Markets Mergers and acquisitions bring forth several technology and platform sharing agreements, enabling companies to reduce product development time and costs. Further it will be helpful in stepping in to new markets Through mergers and acquisitions corporations will be able to obtain technology economies. I.e. Mergers and acquisitions will result in enhancing the level of technology sharing and utilisation than earlier. As such in automobile industry there can be seen major acquisitions or mergers. For an example in 1979 Honda Motor company signed technical collaboration with British Leyland (Now Rover Group), covering British Leyland production of Triumph Acclaim cars in the United Kingdom. It was a step taken to enter in to the European market and also to obtain the technology of Rover Group. As mentioned earlier, mergers and acquisitions can be seen as a way of entering into strange, emerging markets. Some countries in the emerging markets such as India, China, and Thailand are growing at a spectacular rate. Thus this amazing growth rates are attracting global automotive majors to these markets in increasing numbers. Companies are resorting to acquisitions or mergers to gain foothold in these markets due to certain cultural reasons or to accommodate differences in two cultures. Question Three: Corporate Social responsibilities Competitiveness Using information from relevant literature on Corporate Social Responsibility (CSR) and appropriate examples from global automotive makers and suppliers; explain the impact of CSR on organisational performance in both financial and non-financial areas Corporate Social Responsibility (CSR) has permeated management practice and theory up to a point where CSR can be referred to as the latest management fad (Guthey, Langer Morsing, 2006). However, so far CSR integration in to business processes has been very uneven. (Hockerts, 2008) CSR is also known as Corporate Citizenship, Responsible Business, Sustainable Responsible Business (SRB), or Corporate Social Performance. The concept of social responsibility proposes that a private corporation has responsibilities to society and also to the environment that extended beyond making a profit. It is a form of corporate self regulation integrated in to a business model that functions as a built-in, self-regulating mechanism whereby business would monitor and ensure its support to law, ethical standards, and international norms. Further more, CSR focused business would proactively uphold the public interest by heartening community growth and development, and voluntarily eliminating practices that harm the public sphere, regardless of legality. Essentially, CSR is the deliberate inclusion of public interest in to corporate decision making and the honouring of a triple bottom line; People, Planet, Profit. Where as People and Planet in the triple bottom line concept represents the non financial aspects that a firm should concentrates on when carrying out its business in addition to the financial aspect of making profits. The automobile industry at present faces challenges that extend beyond the framework of automotive technology, such as the prevention of global warming by committing to zero emissions as part of a concentrated effort toward issues concerning the global environment, eradication of wasted resources and environmental degradation through mass production, sales and disposal and the realization of fail safe transportation system. It is necessary for an organization, specially an automobile maker to be focused on preventing environmental destruction and damage when establishing its plants and as well as carrying out its manufacturing activities. A new evolution is required, where lean production can be implemented beyond the sphere of technological innovation to contribute to reforming distribution, logistics, recycling and as well as social systems. As such consumers expect automotive corporations to take an active role in the economic and social development of their country. Consumers across the world are very likely to accept or reject a corporation based on its reputation for social and environmental responsibility. CSR surveys indicate that consumers are more likely to purchase a product or a service from a corporation with responsible business practices and they would refrain from purchasing a product or service if the corporation failed to follow environmentally friendly or ethical business practices. Among the global automotive corporations BMW, Honda, Toyota and Volvo trucks ranked highest for corporate social responsibility. BMW rated highest in the Spain and as well as in Italy; Honda for United States, United Kingdom and Indonesia, Toyota for Japan, Korea and Thailand and Volvo trucks for Sweden and Netherlands. Remy Pothet, Global Director TNS Automotive, comments that Large corporations are increasingly aware that their social responsibility directly affects their image and brand equity and consequently, their business success. As such heavy investments in CSR can be seen in the markets where they are focusing on expansion. The result of our study highlights the publics growing interest in the field of CSR, and makes a direct link between this and their purchasing behaviour. Bonsi concludes, The general public is a very important stake holder for the automotive industry as a corporations reputation is often judged in the court of public opinion. Corporations that fail to engage society often suffer serious consequences when there is a crisis. However corporations that develop a strong public goodwill can use it as a social insurance to tide them over during difficult periods. The CSR champions identified by this study are already seeing the value in their investment; now other companies need to take notice. b) Compare and Contrast Japanese and Western strategic leadership models by reference to table 5 in the Honda case study. Explain which of the two models you prefer, and why? According to the management literature, there is a grand distinction between the western management style and Japanese management style in terms of overall description work processes, production organisation and logistic management techniques, organisation and labour relations etc. When concerning about the overall description western management model, Ford system of mass production which leads to standardisation and mass marketing is the fundamental paradigm for production systems in western countries that pays high attention on large lot , just in case production. Where as Japanese developed a different production system called Japanese production system or Just In Time (JIT), which is a flexible manufacturing system. A further development of this is also known as lean manufacturing. They adhered to the Pull strategy of marketing their products as oppose to the Push strategy of marketing adopted by the western countries. The significance of the Japanese manufacturing is it identified the ill effects of mass production with high volume of manufacturing that focuses sole attention towards economy of scale rather than cost reduction through elimination of wasted resources through streamlined production. JIT production and synchronized manufacturing that manufactured what, when, and how much was necessary and eliminated wasteful processes and stock. This was resulted in ending up of cycle of stockpiles and dissolved the rigidity of production where only existing products continued to be manufactured with existing technology. When concentrating the peculiarities between western and Japanese work processes, most of the western work processes were builds upon taylorism theory which emphasis the necessity of breaking down of every action, job or task in to small and simple segments that can be easily analyzed and taught. Accordingly western employees are deemed to be Do workers and most of them are unskilled thus they are expected to be performed in a way they thought, and merely the jobs or tasks assigned to them. But Japanese employees are deemed to be Think workers where they are expected to be innovative, polyvalent and flexible rather than merely executing an assigned job or a task. As such Japanese management model is more appropriate and suitable to todays complex business context due to above mentioned grounds. Conclusion First and fore mostly the report discussed about the business level strategy and the corporate level strategy in the global business context. It was compared and contrasted the business level strategies and the corporate strategies in the global automobile industry. Then it evaluated the process of reconciling dichotomies at Honda Motors with reference to the product-related core competencies versus process -related core capabilities dichotomy. Secondly it evaluated critically the impact of certain factors such as too much debt and risk of bankruptcy, potential product synergies, access to new technologies and emerging markets on Mergers and Acquisitions (MA) in the global automobile industry, using appropriate illustrations from the global automotive industry. In current business context Corporate Social Responsibility bears an important place. As such latter part of this report focuses on the corporate social responsibility and the competitiveness, using information from relevant literature on Corporate Social Responsibility (CSR) and appropriate examples from global automotive makers and suppliers. Further it discussed the impact of CSR on organisational performance in both financial and non-financial areas. Finally it was compared and contrasted the Japanese and Western strategic leadership models and suggested the Japanese strategic leadership model as the most appropriate model owing to the unique features and strengths identified in it with compared to Western strategic leadership model.

Jimi Hendrix Essay -- History

Jimi Hendrix A legend was born on November 27, 1942 in Seattle with the conception of James Allen Hendrix. He was a true American of Black, White and Cherokee blood. As a child, James who later changed his name to Jimi, was very shy and was introverted to friends and family. He grew up in different homes that ranged from city life to living on the Cherokee reservation with his grandmother. With all of the difficulties that he struggled with in his early life he found refuge in music. His father bought him a guitar at the age of 13 and his love for music had begun. He grew up he listening to the music of the 40's and 50's and became well aquatinted with the sounds of other eras preserved in his father's record collection. There was a great influence of blues as well of R&B music that influenced his style and play. He spent what free time he had on the guitar and dropped out of school in 1959 so he would be able to further pursue his dreams. After he dropped out he enlisted in the army and! spent t his time trying to figure out who he really was. He followed his dreams and after his discharge from the army he became a musician. For the next ten years Hendrix played with a countless number of bands on the way to his notoriety. His greatest success occurred when he formed the Jimi Hendrix Experience in 66'. With this he exposed to America who he was and what he stood for. During his reign he confidently rose to success with powerful and inspiring music. He was, "a prolific and profligate creator who left almost everyone who heard or saw him with the distinct impression that the heartcenter of his work remained tantalizingly out of reach."1 Jimi Hendrix remains an enigma, an innovator that remains unparalleled in what he brought... ... believed was right. He knew no other way, but maintained his integrity. "A musician, if he's a messenger, is like a child who hasn't been handled too many times by man, hasn't had too many fingerprints across his brain. That's why music is so much heavier than anything you've ever felt."7 As stated by Hendrix in 69'. In life, Hendrix wanted the same thing as everyone else. He wanted to enjoy life and his occupation and he wanted to do something which added something positive to the world. He wanted to live life to the fullest and at the same time he wanted to have peace, an open mind, the freedom to be creative and the ability to make the world a better place for the next generations. Jimi Hendrix exemplified the Jesuit philosophy of being a man for others through his religious freedom, his opinionated political views and his positive influence on the community.

Hcc Industries

1. Evaluate the decision to use â€Å"minimum performance standard† (MPS) targets instead of â€Å"stretch† targets. The purpose of setting a budget system is to briefly forecast a company’s performance in the following year, and it can also be a result control system that makes people in the corporation work properly to achieve the objectives and give them incentives by bonus related to performance. From this point of view, the budget system should be reasonable, achievable, and also have some challenge to ensure the hard working. HCC Industries was using â€Å"stretch† performance targets until 1987.The main idea of using â€Å"stretch† targets was to motivate managers to perform at the highest level possible by setting aggressive targets with probability of achievement between 75 % and 80 %. In order to motivate the managers, incentive system was directly related to the budget targets. The bonus potential for division managers was 30% of base sal ary and was equally based on profit before taxes (PBT) and subjective rating of performance depending on the degree of accomplishment of the targets in all seven performance areas.In case that only few of performance areas were not met, but the management considered them important, no subjective bonus would be provided. Objective bonus based on profit before taxes was provided as following: if 60 % of the budget was achieved, 80 % of the bonus potential was paid; if 100 % of the budget was achieved, 100 % of the bonus potential was paid; and if 140% of the budget was achieved, 150 % of the bonus potential was paid. Bonuses were paid quarterly at the level of 80 % of what was earned in order to prevent paying the bonuses that were not earned.However, philosophy of using â€Å"stretch† performance targets in HCC Industries did not work very well, since it encouraged thinking optimistically that pushed employees to perform at a higher level leading to innovation. This philosophy is advantageous for particular companies with a certain size that have an understanding of the markets and have an ability to influence them. HCC Industries was a small publicly held corporation which was just taking orders and not doing marketing. For this reason, there was little probability for the employees to enlarge the market and achieve an aggressive growth in sales every year.Performance targets were set too high and optimistic, they were unrealistic, unachievable, and not suitable for a company which could not make a sustaining growth by influencing the market. One of the main disadvantages of â€Å"stretch† targets was that they were set too high. This led to the situation that for the last four years HCC Industries never achieved its targets. As a result, employees lost their motivation and commitment to achieve the targets; they were discouraged, and exert less effort by giving up trying, as they felt that â€Å"stretch† concept was causing the corporatio n not to achieve its plans.If a division keeps missing the budgets, employees feel like a failure. Taking into account that the employees could not achieve the targets for already four years, they had lost their confidence and became used to missing the budget and the enthusiasm to strive for the objectives was weakened. Although the targets were set at an unreachable level, the control system was not that tight. Even if the managers failed to achieve the targets, they may also be paid the bonus. For example, the managers were still paid 80% of objective bonus potential based on profit before taxes if they had just achieved 60% of the budget.So if a manager was not so ambitious, he did not have to worry about meeting the budget. Moreover, important constraint to motivation of division personnel was that they did not know their bonus potential and the bases on which the bonus awards were made, as division managers did not want to disclose division-level financial information to their personnel. As a result, being unaware of the main objectives of the corporation and its incentive system, employees did not exactly know what they are expected to do and how they would be rewarded for their efforts.As a result of the lack of communication between division managers, middle managers and employees, division personnel became discouraged and demotivated. In addition, if employees are systematically undercompensated, the corporation may suffer from losing key employees. Another disadvantage of â€Å"stretch† performance targets was subjectivity of incentive system. According to the information, provided from the case study, bonuses were paid only to employees included in the bonus plan. It can be concluded that not all employees were included in this plan.Moreover, half of the bonus potential was based on subjective evaluation of top management. However, there is a concern whether top management could judge each division in appropriate way, taking into account all the differences between them. The aforementioned subjective aspect influences performance and motivation of employees. In addition, important demotivating factor was that awards had to be paid quarterly at the level of 80% of what was earned. It took three to four months before they actually were paid because the necessary approvals by several levels were needed before the payments could be made.The remaining 20 % was paid at the end of the year based on annual performance. Taking into account aforementioned challenges of using â€Å"stretch† performance targets, the management of the corporation had taken a decision to change the philosophy to â€Å"minimum performance standard† (MPS) targets from the fiscal year 1988 onwards. The philosophy provided a two-level budget standards. The first level included the minimum performance standard that determined the basic financial target that divisions should reach. The second level included the targets that were set more cha llenging, and had some incentive effect.The main objective of this decision was to submit budgets with realistic targets with an achievement probability of 100% in order that divisions could meet the targets. As a result, division managers and other employees would become motivated by being proud of themselves, having self-esteem and starting feeling like â€Å"winners†. Being motivated, division personnel would be encouraged to work hard, be entrepreneurial and increase the level of aspiration for the future. Moreover, they would be given an opportunity to earn extra rewards.Another advantage of highly achievable budget targets is that they reduce the costs of needed interventions from corporate managers and the costs of optimistic revenue projections. Highly achievable budget targets also reduce the risk of game-playing. However, not all potential advantages of MPS targets were achieved in HCC Industries. Before implementing MPS targets, corporate managers did not analyze c arefully all problems that the company faced on the level of operations, marketing and finance. Corporate managers of HCC industries introduced the following changes in the corporation connected with the switch to MPS budgeting philosophy.First of all, the probability of the achievement of the budgets had been changed. MPS budgets were to be set with the felt probability of achievement 100%. In addition, managers were asked to set targets that exceed normal capability and involve an increase by 25-30 % with the probability of achievement of 50 %. However, although the budgets were planned to be set realistic and achievable, in reality they were too high and some division managers were even more than before concerned whether it would be possible to achieve them.In some divisions, such as Glasseal and Sealtron, corporate managers just increased the planned budgets without any analysis of the actual situation and discussion about business potential and risks with the division managers. As a result, division managers became even more demotivated because of too optimistic budgets. Moreover, by missing the new budgets, employees could be fired. The division manager of Hermetite was not provided by top managers with essential information about the corporation, its strategy, targets and the actual situation, and targets of his division before planning the budget.Being just hired and having the lack of experience and knowledge, he set too optimistic targets that could never be achieved in reality. As a result, the new division manager experienced failure and frustration at the beginning of his working experience in HCC Industry that had led to undermining of his confidence and commitment. Secondly, the incentive system had also been changed. According to new incentive compensation plan, bonus pool consisted of 20 % of the amount by which actual division PBT exceed MPS and 25 % of the amount by which it exceeded the target.Bonuses were paid quarterly at a level of 90 % of that earned and the remaining 10 % at the end of the year depending on the performance. It can be concluded that the rewards became lower than with â€Å"stretch† performance targets. The probability of losing the job in case the MPS targets would not be met, became greater. The disadvantage of subjective judgment concerning the bonuses was not eliminated under the new philosophy, as the division managers were given the discretion to decide which of their subordinates would share in the bonus pool and how the pool would be allocated among themselves and the others included.The key factor to the success of the budget system lied in the accuracy of forecasting the market share, the booking rate, the potential growth of sales, and so on. If a manager had little knowledge about the market information and the competitors, it would be difficult to set the MPS. The effectiveness of the budget system would be weakened, and this was the one of the main problems HCC faced after intr oduction of the MPS system. Evaluating the decision of changing the corporation’s philosophy based on early results, allows concluding that the new concept was not implemented well, even given the fact that it was a good idea.After the first quarter of fiscal year 1988, none of the divisions achieved all of its MPS and some of the divisions missed their minimum performance by large margins. 2. Should HCC managers have expected that the MPS target-setting philosophy would be equally effective in all four operating divisions described? HCC Industries was organized into four operating divisions: Hermetic Seal, Glasseal, Sealtrol that were producing connectors of various types, and Hermetite that was producing custom-designed, micro-electronic packages. Each division was run by a general manager who was responsible for all business functions of a certain division.In order to proper evaluate and monitor divisions’ results on which the bonuses were based, controllers of each division reported to HCC’s CFO. Corporate managers should have taken into account that the divisions differ from each other, and should have considered each division separately while using MPS target-setting philosophy as each division had some specific characteristics that were different from others. Although all the three connector divisions were similar in that they were profitable but growing slowly, there was a significant difference in the degree of standardization of their product lines.For example, division Sealtrol was highly standardized and produced connectors with large economies of scale. On the contrast, Hermetic Seal was the least standardized division and operated primarily as a job shop that designed and produced small batches of custom connectors. Glasseal’s product lines had the medium level of standardization. The forth division Hermetite was completely different from the connector divisions. In comparison with the first three divisions, its market and competitors were well defined and its potential for growth was tremendous.In addition, Hermetite faced huge price competition and significant production technology and control challenges. Moreover, the production processes were complex and its engineering and production organizations were instable. Given the fact that all four divisions were independent from each other, had different targets, accounting and information systems, product standards, served different customers, had different professional background of division managers, a detailed analysis should have been made whether MPS targets would be equally effective in all four divisions.Mike Pelta, the manager of the first division Hermetic Seal was more motivated after the changes, as with â€Å"stretch† performance targets, the probability of the achievement of the targets was 85-90%, whereas with MPS targets it has increased by 95-98%. The reason of such a high probability of achievement the targets was the fact that the division manager had set conservative targets. Mike Pelta was a cofounder of HCC, and was more familiar with the situation of the company. From the first quarter revenue result of 1988, we can find that only Hermetic Seals exceeded target in both bookings and profit before tax.But on the other hand, there were some problems in product qualities such as returns and rework. The manager of the second division Glasseal was even more demotivated after the changes than under the â€Å"stretch† performance targets. After the division manager had prepared the budget based on realistic forecast, the targets were increased by corporate managers. As a result, the probability of the achievement of the targets remained 90%, as it was before changes. However, with the â€Å"stretch† targets the rewards were greater and could be earned even if the budget was missed.It could be concluded that the change for MPS targets had not become better and more motivated for the second d ivision. Historical performance of the third division Sealtron was not so good. Efficiency in sales per employee was 50 % below other connector divisions, and budget was missed so salaries were frozen. The division manager, Lou Palamara, was recruited in 1986. Lou Palamara had a background of an engineering manager, so he was not that familiar with the corporation and had less knowledge about budget and cost saving. The division manager was discouraged by newMPS targets, as the targets he set had significantly been increased by corporate managers and the probability of its achievement according to division manager, was only 60-65%. As a result, if the budget would have increased by 18 % compared to the previous year, there would be still no bonus earned. Moreover, in case MPS standards would not be achieved the manager could be fired. At the same time, CFO of the corporation assessed the probability of the achievement of the targets by 90%. His idea was to stimulate sales as the Sea ltron’s efficiency was below other connector divisions.It can be concluded that the opinion of top managers and division manager on the achievement of targets was significantly different (90 % versus 60-65 %). In this situation, in order to come to common solution, additional analysis should have been done of actual situation and current performance of the division. It should have been carefully analyzed the reason of poor performance of the third division. Before the fourth division Hermetite was acquired in August 1985, it had been operating at a loss for the price competition and the production problems.The former general manager of Hermetite left a serious delinquency problem, which had worsen the reputation of the company, so booking could not be guaranteed. The manager Alan Wong, being new in the corporation and lacking particular experience and knowledge, was not provided with additional training and explanation of the corporation’s and division’s main ob jectives. He thought the corporate managers would not accept a budget that projected a loss. As a result, he had set very aggressive and optimistic targets that were unrealistic and corporate managers decreased the targets.However, the probability of achievement of the performance target at sales was 80 % and PBT target was only 5 %. The performance of the forth division was very risky and uncertain. From the first quarter results of 1988, we can discover that the bookings and shipments were both below MPS. After analyzing MPS targets in all four divisions, it could be concluded that only the manager of the first division, that was the original HCC business, was motivated by the changes. The managers of the other three divisions were even more concerned than before the changes.The main reason of such situation was that corporate managers thought that the targets were achievable, whereas division managers had the opinion that they are not achievable and unrealistic. It can be conclud ed that there was a lack of communication between corporate and division managers. Moreover, the evaluation standards were the same for every division without taking into account different situation and various targets of each division. Given the fact that there were only four independent divisions, individual approach and specific evaluation standards for each division should have been used. 3.What, if anything, could have been done to improve the implementation of the new philosophy? From 1988 onwards, the philosophy in HCC Industries had been changed from â€Å"stretch† targets to minimum performance standard (MPS) targets. However, according to the results of the first quarter of 1988, none of the divisions had achieved all of its MPS. It can be concluded that there were some problems in implementing new philosophy. First of all, the targets of every division should be aligned with the long-term strategy of the corporation. Top managers should clearly set the company stra tegy and priorities and communicate them to all divisions.Division managers should in turn have been communicated to the corporate managers opportunities, resource needs, constraints and risks. HCC Industries would achieve success if all divisions would work together towards common targets and objectives instead of being concentrated on personal goals of each division that could diverge from the strategy of corporation. According to the information provided in the case study, corporate managers were confident that the set objectives were achievable and realistic, division managers had the opposite opinion.As a result, division managers were discouraged to perform from the beginning. In order to avoid demotivation and increase the probability of the achievement of the targets, the balance should be found between the desires of the top management and the possibilities of the divisions. In that case, they closely need to communicate with each other and come together to the common solut ion. This would lead to more realistic budgets, would build employees up and increase managers’ commitment to achieve the targets.Secondly, as long as at HCC all divisions were decentralized, the differences and unique characteristics of each division should be taken into account. As a result, different performance evaluation standards should be used for every division. It is impossible to compare Hermetic Seal which is the original HCC business with Glasseal and Sealtron that were acquired even if all of them produce connectors. Moreover, the degree of standardization of product lines within these divisions is completely different. The forth division is completely different from the first three.That is why individual approach should be used for every division. There are only four divisions, that is why it is realistic for corporate managers to evaluate and analyze each division separately. Whereas some divisions could achieve higher targets, for others lower targets are more realistic. When planning the budget, the actual situation and performance of each division should be analyzed instead of comparison with other divisions. Before increasing the targets of the second and third divisions a more detailed analysis was needed.In addition, it would be helpful for corporate managers to discuss with the division managers the possible constrains of poor performance of their divisions and to evaluate whether additional actions are needed in order to improve performance. In order not to demotivate employees, it would be better to agree the targets and to find compromise rather than just to set them. Corporate managers should establish the dialogue with division managers and other personnel in order to gather an objective opinion about the real situation inside the company.Such working atmosphere would encourage employees to be involved in the company more and would give them the feeling that corporate managers listen to them when changing strategic issues. Div ision managers would feel themselves important in the organization and would be more encouraged to perform at the highest level possible and would feel more responsibility for the achievement of the targets. Thirdly, top management before changing the budgeting philosophy should have made a sound analysis of current performance on corporate level as it is a very important decision.Implementing new standards for evaluating involves the research of effectiveness of operation potential growth, the personal characteristics, the financial constraints, resource limitations, opportunities and risks. Fourthly, personal controls could be used by training division managers. For instance, it was very important for the fourth division to provide the manager with some additional information about the corporation before planning the budget.Taking into account the fact that Alan Wong was relatively new in the corporation, it is quite obvious that he lacks some experience and knowledge to plan an e ffective and realistic budget. It is also clear from the information provided in the case study, that he was unfamiliar with the strategy of the corporation and the expectations from the top managers from his division. Planning the budget is very important for the corporation. It requires deep understanding not only the goals and objectives of a particular division but also of the entire corporation.As there was a lack of communication between the top management and the division managers, the new division manager had set unrealistic budget. Fifthly, there was not only a lack of communication between top management and division managers, but also between the division personnel. In order to increase the motivation amongst personnel, the division managers should clearly communicate the main objectives and set the targets to their employees and provide them with the detailed information concerning the incentive system.In this case, employees would understand what they are expected to do and how they would be rewarded for that. Sixthly, as the marketing information collection was an obvious obstacle for the accurate forecast of the future, it is important to set up a marketing team in the four divisions. The target of the team is to collect the market share data of each product in previous years, the reasons for the up-and-downs of the market share, find out what kind of improvement will the target consumers need in the future, the scale of potential customers, and so on.With the detailed information of the market, it will be easier for the division to forecast the future sales and try to expand the existing market. Seventhly, it can be suggested, that for the first year when the changes were applied, the top management could set very realistic conservative targets in order to encourage employees and make them feel that the targets are achievable. Given the fact that the targets were not achieved for the last four years the employees got used to missing targets and became demotivated.In addition, given the fact that some divisions, for example Hermetite, experience current problems, flexible targets could be set, that would depend on certain conditions at a particular time. Finally, before taking a new decision about the changes, it could be helpful to organize the meeting with all division managers in order to announce them personally about the expected changes and gather some ideas from them about how to implement the new philosophy. Such brainstorming could help to pay attention to some important aspects from the bottom that top management was not considering. Hcc Industries 1. Evaluate the decision to use â€Å"minimum performance standard† (MPS) targets instead of â€Å"stretch† targets. The purpose of setting a budget system is to briefly forecast a company’s performance in the following year, and it can also be a result control system that makes people in the corporation work properly to achieve the objectives and give them incentives by bonus related to performance. From this point of view, the budget system should be reasonable, achievable, and also have some challenge to ensure the hard working. HCC Industries was using â€Å"stretch† performance targets until 1987.The main idea of using â€Å"stretch† targets was to motivate managers to perform at the highest level possible by setting aggressive targets with probability of achievement between 75 % and 80 %. In order to motivate the managers, incentive system was directly related to the budget targets. The bonus potential for division managers was 30% of base sal ary and was equally based on profit before taxes (PBT) and subjective rating of performance depending on the degree of accomplishment of the targets in all seven performance areas.In case that only few of performance areas were not met, but the management considered them important, no subjective bonus would be provided. Objective bonus based on profit before taxes was provided as following: if 60 % of the budget was achieved, 80 % of the bonus potential was paid; if 100 % of the budget was achieved, 100 % of the bonus potential was paid; and if 140% of the budget was achieved, 150 % of the bonus potential was paid. Bonuses were paid quarterly at the level of 80 % of what was earned in order to prevent paying the bonuses that were not earned.However, philosophy of using â€Å"stretch† performance targets in HCC Industries did not work very well, since it encouraged thinking optimistically that pushed employees to perform at a higher level leading to innovation. This philosophy is advantageous for particular companies with a certain size that have an understanding of the markets and have an ability to influence them. HCC Industries was a small publicly held corporation which was just taking orders and not doing marketing. For this reason, there was little probability for the employees to enlarge the market and achieve an aggressive growth in sales every year.Performance targets were set too high and optimistic, they were unrealistic, unachievable, and not suitable for a company which could not make a sustaining growth by influencing the market. One of the main disadvantages of â€Å"stretch† targets was that they were set too high. This led to the situation that for the last four years HCC Industries never achieved its targets. As a result, employees lost their motivation and commitment to achieve the targets; they were discouraged, and exert less effort by giving up trying, as they felt that â€Å"stretch† concept was causing the corporatio n not to achieve its plans.If a division keeps missing the budgets, employees feel like a failure. Taking into account that the employees could not achieve the targets for already four years, they had lost their confidence and became used to missing the budget and the enthusiasm to strive for the objectives was weakened. Although the targets were set at an unreachable level, the control system was not that tight. Even if the managers failed to achieve the targets, they may also be paid the bonus. For example, the managers were still paid 80% of objective bonus potential based on profit before taxes if they had just achieved 60% of the budget.So if a manager was not so ambitious, he did not have to worry about meeting the budget. Moreover, important constraint to motivation of division personnel was that they did not know their bonus potential and the bases on which the bonus awards were made, as division managers did not want to disclose division-level financial information to their personnel. As a result, being unaware of the main objectives of the corporation and its incentive system, employees did not exactly know what they are expected to do and how they would be rewarded for their efforts.As a result of the lack of communication between division managers, middle managers and employees, division personnel became discouraged and demotivated. In addition, if employees are systematically undercompensated, the corporation may suffer from losing key employees. Another disadvantage of â€Å"stretch† performance targets was subjectivity of incentive system. According to the information, provided from the case study, bonuses were paid only to employees included in the bonus plan. It can be concluded that not all employees were included in this plan.Moreover, half of the bonus potential was based on subjective evaluation of top management. However, there is a concern whether top management could judge each division in appropriate way, taking into account all the differences between them. The aforementioned subjective aspect influences performance and motivation of employees. In addition, important demotivating factor was that awards had to be paid quarterly at the level of 80% of what was earned. It took three to four months before they actually were paid because the necessary approvals by several levels were needed before the payments could be made.The remaining 20 % was paid at the end of the year based on annual performance. Taking into account aforementioned challenges of using â€Å"stretch† performance targets, the management of the corporation had taken a decision to change the philosophy to â€Å"minimum performance standard† (MPS) targets from the fiscal year 1988 onwards. The philosophy provided a two-level budget standards. The first level included the minimum performance standard that determined the basic financial target that divisions should reach. The second level included the targets that were set more cha llenging, and had some incentive effect.The main objective of this decision was to submit budgets with realistic targets with an achievement probability of 100% in order that divisions could meet the targets. As a result, division managers and other employees would become motivated by being proud of themselves, having self-esteem and starting feeling like â€Å"winners†. Being motivated, division personnel would be encouraged to work hard, be entrepreneurial and increase the level of aspiration for the future. Moreover, they would be given an opportunity to earn extra rewards.Another advantage of highly achievable budget targets is that they reduce the costs of needed interventions from corporate managers and the costs of optimistic revenue projections. Highly achievable budget targets also reduce the risk of game-playing. However, not all potential advantages of MPS targets were achieved in HCC Industries. Before implementing MPS targets, corporate managers did not analyze c arefully all problems that the company faced on the level of operations, marketing and finance. Corporate managers of HCC industries introduced the following changes in the corporation connected with the switch to MPS budgeting philosophy.First of all, the probability of the achievement of the budgets had been changed. MPS budgets were to be set with the felt probability of achievement 100%. In addition, managers were asked to set targets that exceed normal capability and involve an increase by 25-30 % with the probability of achievement of 50 %. However, although the budgets were planned to be set realistic and achievable, in reality they were too high and some division managers were even more than before concerned whether it would be possible to achieve them.In some divisions, such as Glasseal and Sealtron, corporate managers just increased the planned budgets without any analysis of the actual situation and discussion about business potential and risks with the division managers. As a result, division managers became even more demotivated because of too optimistic budgets. Moreover, by missing the new budgets, employees could be fired. The division manager of Hermetite was not provided by top managers with essential information about the corporation, its strategy, targets and the actual situation, and targets of his division before planning the budget.Being just hired and having the lack of experience and knowledge, he set too optimistic targets that could never be achieved in reality. As a result, the new division manager experienced failure and frustration at the beginning of his working experience in HCC Industry that had led to undermining of his confidence and commitment. Secondly, the incentive system had also been changed. According to new incentive compensation plan, bonus pool consisted of 20 % of the amount by which actual division PBT exceed MPS and 25 % of the amount by which it exceeded the target.Bonuses were paid quarterly at a level of 90 % of that earned and the remaining 10 % at the end of the year depending on the performance. It can be concluded that the rewards became lower than with â€Å"stretch† performance targets. The probability of losing the job in case the MPS targets would not be met, became greater. The disadvantage of subjective judgment concerning the bonuses was not eliminated under the new philosophy, as the division managers were given the discretion to decide which of their subordinates would share in the bonus pool and how the pool would be allocated among themselves and the others included.The key factor to the success of the budget system lied in the accuracy of forecasting the market share, the booking rate, the potential growth of sales, and so on. If a manager had little knowledge about the market information and the competitors, it would be difficult to set the MPS. The effectiveness of the budget system would be weakened, and this was the one of the main problems HCC faced after intr oduction of the MPS system. Evaluating the decision of changing the corporation’s philosophy based on early results, allows concluding that the new concept was not implemented well, even given the fact that it was a good idea.After the first quarter of fiscal year 1988, none of the divisions achieved all of its MPS and some of the divisions missed their minimum performance by large margins. 2. Should HCC managers have expected that the MPS target-setting philosophy would be equally effective in all four operating divisions described? HCC Industries was organized into four operating divisions: Hermetic Seal, Glasseal, Sealtrol that were producing connectors of various types, and Hermetite that was producing custom-designed, micro-electronic packages. Each division was run by a general manager who was responsible for all business functions of a certain division.In order to proper evaluate and monitor divisions’ results on which the bonuses were based, controllers of each division reported to HCC’s CFO. Corporate managers should have taken into account that the divisions differ from each other, and should have considered each division separately while using MPS target-setting philosophy as each division had some specific characteristics that were different from others. Although all the three connector divisions were similar in that they were profitable but growing slowly, there was a significant difference in the degree of standardization of their product lines.For example, division Sealtrol was highly standardized and produced connectors with large economies of scale. On the contrast, Hermetic Seal was the least standardized division and operated primarily as a job shop that designed and produced small batches of custom connectors. Glasseal’s product lines had the medium level of standardization. The forth division Hermetite was completely different from the connector divisions. In comparison with the first three divisions, its market and competitors were well defined and its potential for growth was tremendous.In addition, Hermetite faced huge price competition and significant production technology and control challenges. Moreover, the production processes were complex and its engineering and production organizations were instable. Given the fact that all four divisions were independent from each other, had different targets, accounting and information systems, product standards, served different customers, had different professional background of division managers, a detailed analysis should have been made whether MPS targets would be equally effective in all four divisions.Mike Pelta, the manager of the first division Hermetic Seal was more motivated after the changes, as with â€Å"stretch† performance targets, the probability of the achievement of the targets was 85-90%, whereas with MPS targets it has increased by 95-98%. The reason of such a high probability of achievement the targets was the fact that the division manager had set conservative targets. Mike Pelta was a cofounder of HCC, and was more familiar with the situation of the company. From the first quarter revenue result of 1988, we can find that only Hermetic Seals exceeded target in both bookings and profit before tax.But on the other hand, there were some problems in product qualities such as returns and rework. The manager of the second division Glasseal was even more demotivated after the changes than under the â€Å"stretch† performance targets. After the division manager had prepared the budget based on realistic forecast, the targets were increased by corporate managers. As a result, the probability of the achievement of the targets remained 90%, as it was before changes. However, with the â€Å"stretch† targets the rewards were greater and could be earned even if the budget was missed.It could be concluded that the change for MPS targets had not become better and more motivated for the second d ivision. Historical performance of the third division Sealtron was not so good. Efficiency in sales per employee was 50 % below other connector divisions, and budget was missed so salaries were frozen. The division manager, Lou Palamara, was recruited in 1986. Lou Palamara had a background of an engineering manager, so he was not that familiar with the corporation and had less knowledge about budget and cost saving. The division manager was discouraged by newMPS targets, as the targets he set had significantly been increased by corporate managers and the probability of its achievement according to division manager, was only 60-65%. As a result, if the budget would have increased by 18 % compared to the previous year, there would be still no bonus earned. Moreover, in case MPS standards would not be achieved the manager could be fired. At the same time, CFO of the corporation assessed the probability of the achievement of the targets by 90%. His idea was to stimulate sales as the Sea ltron’s efficiency was below other connector divisions.It can be concluded that the opinion of top managers and division manager on the achievement of targets was significantly different (90 % versus 60-65 %). In this situation, in order to come to common solution, additional analysis should have been done of actual situation and current performance of the division. It should have been carefully analyzed the reason of poor performance of the third division. Before the fourth division Hermetite was acquired in August 1985, it had been operating at a loss for the price competition and the production problems.The former general manager of Hermetite left a serious delinquency problem, which had worsen the reputation of the company, so booking could not be guaranteed. The manager Alan Wong, being new in the corporation and lacking particular experience and knowledge, was not provided with additional training and explanation of the corporation’s and division’s main ob jectives. He thought the corporate managers would not accept a budget that projected a loss. As a result, he had set very aggressive and optimistic targets that were unrealistic and corporate managers decreased the targets.However, the probability of achievement of the performance target at sales was 80 % and PBT target was only 5 %. The performance of the forth division was very risky and uncertain. From the first quarter results of 1988, we can discover that the bookings and shipments were both below MPS. After analyzing MPS targets in all four divisions, it could be concluded that only the manager of the first division, that was the original HCC business, was motivated by the changes. The managers of the other three divisions were even more concerned than before the changes.The main reason of such situation was that corporate managers thought that the targets were achievable, whereas division managers had the opinion that they are not achievable and unrealistic. It can be conclud ed that there was a lack of communication between corporate and division managers. Moreover, the evaluation standards were the same for every division without taking into account different situation and various targets of each division. Given the fact that there were only four independent divisions, individual approach and specific evaluation standards for each division should have been used. 3.What, if anything, could have been done to improve the implementation of the new philosophy? From 1988 onwards, the philosophy in HCC Industries had been changed from â€Å"stretch† targets to minimum performance standard (MPS) targets. However, according to the results of the first quarter of 1988, none of the divisions had achieved all of its MPS. It can be concluded that there were some problems in implementing new philosophy. First of all, the targets of every division should be aligned with the long-term strategy of the corporation. Top managers should clearly set the company stra tegy and priorities and communicate them to all divisions.Division managers should in turn have been communicated to the corporate managers opportunities, resource needs, constraints and risks. HCC Industries would achieve success if all divisions would work together towards common targets and objectives instead of being concentrated on personal goals of each division that could diverge from the strategy of corporation. According to the information provided in the case study, corporate managers were confident that the set objectives were achievable and realistic, division managers had the opposite opinion.As a result, division managers were discouraged to perform from the beginning. In order to avoid demotivation and increase the probability of the achievement of the targets, the balance should be found between the desires of the top management and the possibilities of the divisions. In that case, they closely need to communicate with each other and come together to the common solut ion. This would lead to more realistic budgets, would build employees up and increase managers’ commitment to achieve the targets.Secondly, as long as at HCC all divisions were decentralized, the differences and unique characteristics of each division should be taken into account. As a result, different performance evaluation standards should be used for every division. It is impossible to compare Hermetic Seal which is the original HCC business with Glasseal and Sealtron that were acquired even if all of them produce connectors. Moreover, the degree of standardization of product lines within these divisions is completely different. The forth division is completely different from the first three.That is why individual approach should be used for every division. There are only four divisions, that is why it is realistic for corporate managers to evaluate and analyze each division separately. Whereas some divisions could achieve higher targets, for others lower targets are more realistic. When planning the budget, the actual situation and performance of each division should be analyzed instead of comparison with other divisions. Before increasing the targets of the second and third divisions a more detailed analysis was needed.In addition, it would be helpful for corporate managers to discuss with the division managers the possible constrains of poor performance of their divisions and to evaluate whether additional actions are needed in order to improve performance. In order not to demotivate employees, it would be better to agree the targets and to find compromise rather than just to set them. Corporate managers should establish the dialogue with division managers and other personnel in order to gather an objective opinion about the real situation inside the company.Such working atmosphere would encourage employees to be involved in the company more and would give them the feeling that corporate managers listen to them when changing strategic issues. Div ision managers would feel themselves important in the organization and would be more encouraged to perform at the highest level possible and would feel more responsibility for the achievement of the targets. Thirdly, top management before changing the budgeting philosophy should have made a sound analysis of current performance on corporate level as it is a very important decision.Implementing new standards for evaluating involves the research of effectiveness of operation potential growth, the personal characteristics, the financial constraints, resource limitations, opportunities and risks. Fourthly, personal controls could be used by training division managers. For instance, it was very important for the fourth division to provide the manager with some additional information about the corporation before planning the budget.Taking into account the fact that Alan Wong was relatively new in the corporation, it is quite obvious that he lacks some experience and knowledge to plan an e ffective and realistic budget. It is also clear from the information provided in the case study, that he was unfamiliar with the strategy of the corporation and the expectations from the top managers from his division. Planning the budget is very important for the corporation. It requires deep understanding not only the goals and objectives of a particular division but also of the entire corporation.As there was a lack of communication between the top management and the division managers, the new division manager had set unrealistic budget. Fifthly, there was not only a lack of communication between top management and division managers, but also between the division personnel. In order to increase the motivation amongst personnel, the division managers should clearly communicate the main objectives and set the targets to their employees and provide them with the detailed information concerning the incentive system.In this case, employees would understand what they are expected to do and how they would be rewarded for that. Sixthly, as the marketing information collection was an obvious obstacle for the accurate forecast of the future, it is important to set up a marketing team in the four divisions. The target of the team is to collect the market share data of each product in previous years, the reasons for the up-and-downs of the market share, find out what kind of improvement will the target consumers need in the future, the scale of potential customers, and so on.With the detailed information of the market, it will be easier for the division to forecast the future sales and try to expand the existing market. Seventhly, it can be suggested, that for the first year when the changes were applied, the top management could set very realistic conservative targets in order to encourage employees and make them feel that the targets are achievable. Given the fact that the targets were not achieved for the last four years the employees got used to missing targets and became demotivated.In addition, given the fact that some divisions, for example Hermetite, experience current problems, flexible targets could be set, that would depend on certain conditions at a particular time. Finally, before taking a new decision about the changes, it could be helpful to organize the meeting with all division managers in order to announce them personally about the expected changes and gather some ideas from them about how to implement the new philosophy. Such brainstorming could help to pay attention to some important aspects from the bottom that top management was not considering.

Story of Maykapal Essays

Story of Maykapal Essays Story of Maykapal Paper Story of Maykapal Paper FEATURES OF ESSAY There are five parts to every essay, and each part has five parts. The basic essay: I). Introductory paragraph A). Introductory sentence, the Hook, and the Thesis sentence/statement B). First thesis point C). Second thesis point D). Third thesis point E). Concluding sentence II). Body Paragraph A). Restating/rephrasing of the first thesis point from the introductory paragraph B). First supporting sentence C). Second supporting sentence D). Third supporting sentence E). Concluding sentence III). Body Paragraph A). Restating/rephrasing of the second thesis point from the introductory paragraph B). First supporting sentence C). Second supporting sentence D). Third supporting sentence E). Concluding sentence IV). Body Paragraph A). Restating/rephrasing of the third thesis point from the introductory paragraph B). First supporting sentence C). Second supporting sentence D). Third supporting sentence E). Concluding sentence V). Concluding Paragraph The concluding paragraph is equally as important as the introduction. You must restate (rephrase) your thesis sentence and all supporting material in a brief and concise format. You must state your proof to your supporting points. And, you must conclude your essay. All of this must fit with or merge with everything you wrote previously. A). Transitional sentence that perhaps rewords the thesis statement of the Introductory paragraph. B). Conclusional sentence rewording the conclusion of the first body paragraph. C). Conclusional sentence rewording the conclusion of the second body paragraph. D). Conclusional sentence rewording the conclusion of the third body paragraph. E). Summation sentence to close the paper and the argument made. Sounds simultaneously simple and complex. Keep in mind that the minimum length of any essay is five paragraphs, with five sentences per paragraph; thats 25 sentences. Youll find that this limit is more and more difficult to maintain as you write more. You will find it difficult to limit yourself to such a small format.

Accounting treatment of software Intangible but vulnerable

Accounting treatment of software Intangible but vulnerable Companies today are highly dependent on complex information technology systems. This trend of relying on the system has grown gradually, but the downside of it is that it has made most companies’ asset base vulnerable. The machinery that used to represent much of the tangible asset base for most companies in the olden days has since been replaced by intangible assets that come in the form of software applications.Advertising We will write a custom essay sample on Accounting treatment of software: Intangible but vulnerable specifically for you for only $16.05 $11/page Learn More Currently enterprise resource planning and supply chain management systems are out of sight, but still play a substantial part in revenue and profit creation or generation. Their impact on a company’s ability to function and retain their reputation is very much tangible and this will usually manifest itself when they breakdown (Batchelor). Many companies are accused of p oor management of their software â€Å"estate.† This may involve a network of interlocking applications of different eras, which are complicated by attempts of making patches and work-arounds aimed at meeting the immediate needs of a business. If companies poorly understand the licensing arrangement stipulate, they may end up paying massive amounts and at times double the initial cost for permissions they are already allowed. They may also at times incur extra charges or costs when they opt to extend the use beyond what is within the permitted range. Finance directors are torn between capitalizing their spending on licensing arrangements on software, which at times can considerably long-term, or whether to account for this spending as an operating expense. Analysts believe that capitalizing your IT spending shows that a person believes that it has the potential to deliver future value. Critics of this proposal claim that it can cause unforeseen problems, and therefore, capita lizing on the IT should not be seen as a way to deliver future value. According to Mike Mobby, who is a partner as well as the lead of the finance consulting practice at Deloitte, a business consultancy group, â€Å"There is a trend to treat IT as an operating cost† (Batchelor). He continues and says that, at times we have situations where projects undertaken have not yielded the expected results and, therefore, companies have ended up having material write-offs since they have already capitalized their spending. The fast moving trend into cloud computing has done a lot in strengthening the belief and the way people view IT. People are gearing up towards appreciating and treating IT as an operating expense rather than investing heavily on IT assets such as hardware and the software needed (Batchelor). Companies have the chance to buy their computing needs from external service providers and do the work at a cheaper price. According to Stewart Buchanan the vice president of re search at Gartner, â€Å"Some organizations like to be asset-light, so they outsource their needs.† (Batchelor).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More As a person who has spent most of his life in the IT industry Gartner is a force to reckon with. He continues and says, â€Å"There has to be a long conversation with the chief financial officer about the assets and liabilities. Many are concerned about liabilities and want to know how much to put in provisions† (Batchelor). The IT system poses a risk to organization and may make companies vulnerable to attacks. They should therefore be treated the same way organizations treat their accounting practices. Consultants and analysts are reported as having increased their interest in the way companies and organizations manage the risks they face from their IT assets. Also not left behind are credit rating agencies who have also taken a keen interest on the same. Mr. Buchanan comments that many of the firms around do not have mechanisms in place or life cycles for the pieces of software that they use. He continues and says, â€Å"If they have it for the main software applications, they may not have it for the next layers down the stack. Organizations need to understand that their software will ‘wear out’ at some stage† (Batchelor). The companies face the risk of having their software vendors or manufactures going out of business, taken over or losing interest in the product sold. This can pose a great challenge for the companies because this may mean that support for the product, hardware or software is no longer available for crucial parts of the company’s IT network. If the company then decides to upgrade or modify their system, then this may mean this part no longer works as well with the new parts of the new system and may become, therefore, redundant. This is a complex problem as Mr. Buchanan explains, â€Å"Clients who take their eyes off the ball may find they lose control of their IT functions and they have to throw money at the problem to fix it. Managers should plan for contingencies just as they do with their supply chain or their manufacturing activities† (Batchelor). From the point of view of Jim McGIvern, â€Å"There is the potential for huge liabilities if you are sitting on a mainframe or an old system that is no longer fit for purpose, no matter how much you maintain it† (Batchelor). Jim is a senior business consultant working for AutoReck, a company that specializes in providing data management services to financial organizations and banks. Another challenge that faces companies and organizations is the complexity in managing licenses. Most times it is impossible to buy a soft ware and the only option company have is to buy specific and limited licenses to use the software. Companies run the risk of being billed by their software vendors if they use the software beyond the license, despite at times they may not know they are abusing the licenses.Advertising We will write a custom essay sample on Accounting treatment of software: Intangible but vulnerable specifically for you for only $16.05 $11/page Learn More Vendors are facing increasing financial pressure and in turn they focus on companies and try to get them enforce licensing arrangements when they are violated. Problems usually arise when companies exceed the agreed number of users of certain programs or allow their employees to join the office network via their phones. At times like this, companies may find themselves being sued by the vendors who are going to claim damages. With the increase in use of mobile phones and smart phones, a challenge arises in various business models. For example, publishers of books or magazines are delivering content digitally to computers and phones. The problem comes when th ey want to set a cost for the service as well as problem with allocating costs, including royalties. This at times will push companies to overhaul their systems such as the accounting systems. This risk is real for every company that uses licensed software and therefore companies are warned to follow and stick to the licensing agreements (Batchelor). Batchelor, Charles. â€Å"Accounting treatment of software: Intangible but vulnerable.† Financial Times. 6 Dec. 2011. Web. https://www.ft.com/.

Ideal Office Temperatures for Productivity

Ideal Office Temperatures for Productivity Conventional wisdom says that finding the ideal office temperature is important to worker productivity. A difference of just a few degrees can have a significant impact on how focused and engaged employees are. For decades, the available research suggested keeping the office temperature between 70 and 73 degrees Fahrenheit would be best for the majority of workers.   The problem was that the research was outdated. It was primarily based on an office full of male employees, as most workplaces were until the latter half of the 20th century. Todays office buildings, however, are likely to have as many women as men. So should that factor into decisions about office temperatures? Women and Office Temperature According to a 2015 study, womens different body chemistry must be considered when setting the office thermostat, especially in the summer months when air conditioners run all day long. Women have lower metabolic rates than men and tend to have more body fat. This means women will tend to be more susceptible to cold than men. So if there are a lot of women in your office, some temperature adjustment may be required. Even though the research may recommend 71.5 F as the minimum acceptable temperature, office managers should consider not only how many women are in the office, but how the building is designed. Large windows that let in a lot of sunlight may make a room feel warmer. High ceilings may create poor air distribution, meaning heaters or air conditioners have to work harder. Knowing your building, as well as the people in it, is crucial to getting that ideal temperature. How Temperature Affects Productivity If productivity is the driving factor in setting office temperatures, looking at old research is not going to help create comfortable workplaces. But research shows that as temperature rises, productivity declines. It makes sense that male and female workers would be less productive in an office with a temperature over 90  F. The same is true as the temperature decreases; with the thermostat set below 60 F, people are going to spend more energy shivering than focused on their work.   Other Factors Affecting Temperature Perception A persons weight, specifically body mass index or BMI, can affect how they react to temperature. Those who weigh more will feel warm more quickly, while those with lower-than-average BMI usually get cold easier.Age also plays a role. As we get older, particularly above 55, we tend to be more easily affected by the cold. So an older workforce may benefit from a slightly warmer office temperature.Humidity  affects how we perceive temperature. If the air is too humid, it can affect peoples ability to sweat, which can lead to heat exhaustion. A relative humidity level of 40 percent is optimal for year-round comfort. And while high humidity can feel oppressive, low humidity can make the air feel colder than it is, which is also problematic. This can cause skin, throat, and nasal passages to feel dry and uncomfortable.Being either too humid or not humid enough affects perceived temperature and comfort levels. So keeping a good relative humidity level is key to maintaining a healthy and p roductive office environment.

Request for Proposals (RFP) Assignment Example | Topics and Well Written Essays - 500 words

Request for Proposals (RFP) - Assignment Example The research will then culminate in recommendations for improving the system. Some of the objectives for the study are as outlined below Online systems of education have to be improved regularly in order to incorporate new and emerging technologies that enhance the ability of the students to get the most from online courses. In the past few years, several systems such as Moodle and Socrates have emerged, each focusing on different aspects of online education. In addition, social media, video conferencing technologies, and messaging technologies such as Whatssap have also emerged as key elements in communication; hence, influencing education. It is crucial for online courses to incorporate all these elements in order to be more effective. The changing technological environment makes it necessary for online courses to be dynamic if they have to continue being relevant into the future. One key element is usability. This concerns the ability of students to access information about their courses and shares the information through various online platforms such as the website (Collins, Weber, &Zambrano, 2014). Such mediums of communication have to be responsive to the needs of the students besides making it easier for them to access and share course content. Online courses have become very popular today as more people gain access to the internet. In addition, the flexibility with which online education brings in terms of time and place of study has helped attract many students to use the online platform. However, changes in technology have made it necessary for providers of online courses to change their strategies from time to time to make the systems more responsive to the needs of students. In this regard, it is critical to improve the usability of online course programs to enhance communication and exchange of ideas among students as well as with the instructors(Collins, Weber, &Zambrano,

Individual Written Comprehensive Care Plan Assignment

Individual Written Comprehensive Care Plan - Assignment Example Dougherty, L & Lister, S. (2011). The Royal Marsden Hospital manual of clinical Nursing procedures, student edition. MA: John Wiley and Sons. Retrieved October 9, 2011, from http://books.google.com/books?id=4AysuLGbMeMC&pg=PT574&dq=Constipation+Care+Plan&hl=en&ei=YdOQTqeUNcS68gOP89UQ&sa=X&oi=book_result&ct=result&resnum=2&ved=0CDQQ6AEwATgU#v=onepage&q=Constipation%20Care%20Plan&f=true. Stepanek, J. S & University of Maryland. (2008). The experiences and needs of parents whose children died due to degenerative disabilities: A qualitative analysis. MI: ProQuest. Retrieved October 9, 2011, from http://books.google.com/books?id=AafbHJfnszMC&pg=PA14&dq=degenerative+neuromuscular+disease&hl=en&ei=ymuRTpeYA4PF8QPQl403&sa=X&oi=book_result&ct=result&resnum=5&ved=0CEgQ6AEwBA#v=onepage&q=degenerative%20neuromuscular%20disease&f=false. -Holistic health perceives and attach great importance to physical, intellectual, socio-cultural, psychological, and spiritual aspects of a client life that should be integrated in health care planning of the individual (Thresyamma, 2005). -Attaining comprehensive holistic health care involves six critical steps that in most cases occur simultaneously: assessment; diagnosis; outcomes, therapeutic care plan, implementation, and evaluation (Dossey, Keegan, and American Holistic Nurses, 2009). Dossey, B. M., Keegan, L & American Holistic Nurses. (2009). Holistic nursing: a handbook for practice. MA: Jones & Bartlett Publishers. Retrieved October 9, 2011, from

Student survival guide Essay Example | Topics and Well Written Essays - 1250 words

Student survival guide - Essay Example Actions plans are required in the present times since there is so much work that a student does. He does not get the time to study in an age of Internet and changing technological regimes. He is surrounded with so much information that studies seem to take a back step, which by all accounts is an unfortunate thing to know. A student must understand that finding the much needed information and data which could assist with his studies is indeed a task that he has to take on his own and this he could do in an effective manner if he knows which libraries he can access the information from and in what manner this search could be made possible in an effective and efficient way. For this to happen, he must ensure that he is well read with the Internet and knows how to use this technological superpower which has hit the academic world like any other, in the times of today. If he knows how to conduct correct search of data and information on the Internet, then he knows how to devise a proper plan for his studies and this indeed is half the job done and that too in a good enough manner. Personal action plans are devised in a manner that makes best use of the library searches so as to get the most productive and up to date information which is needed and these plans look at the maximization of resources as much as possible. What this means is the fact that conducting one such successful library research is the basis of extracting the needed information in the wake of knowledge acquisition and the eventual development of details related with the student’s resource. Also there must be a lot of emphasis on finding the websites which provide authentic information and not mere hearsay. This can be made use of by employing the search engines and the genuine e-libraries which are present on the World Wide Web. Academic honestly must be upheld at all times by the students so that they learn something constructive with the passage of time and