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Copy of Las Ferreterias de Mexico
Transcript of Copy of Las Ferreterias de Mexico
2. How would you modify the plan? Store Manager Las Ferreterias de Mexico Advice and oversight of stores
Select materials and estimate cost
Regional sales office Regional Managers Centralized functions: Corporate Staff Managers Incentive Plan Problems with Current Plan Store Managers Regional Managers Corporate Managers
Upside down bonus structure based on performance
Allocate resources to poor performing areas Improvements Return on Investment Corp Regional Store Manager Employee (cc) image by rocketboom on Flickr (cc) image by quoimedia on Flickr $$$$ $$$ $$ $ Expenses Revenue Purchasing
Investor Relations Performance cannot be measured
Not included in the bonus scheme
Many factors that affect their price and sale are out of their control
Is this any different from the other staff? Personal de Ventas i Encargado!
(Regional salespeople and buyers) Hiring / firing personnel
Calling prospective customers Big Bath Accounting
Violation of matching principle
Misuse of credit checks
Mathematical manipulation of ROI
Controllability principle Issues with ROI ROI: (Revenue-Expense)/Investment
Revenue: All sales except for Regional and Corporate sales
Expenses: All expenses
Investment: Cash, inventory, A/R Decentralized functions: Decentralized functions: Agency Problem
Decentralization Q & A