Case Analysis of “The Best Laid Incentive Plans” Essay

Background Summary The Best Laid Incentive Plan is a case analysis depicting organizational behavior and performance appraisal management. Rainbarrel Products is a loosely ran consumer durables manufacturer. Within the last ten years, Rainbarrel Products has shown difficulties rebounding from a sluggish economy. The CEO, Keith Randall, once described as â€Å"aspiring† and â€Å"innovative†, has allowed the company to fall victim to a downward economy due to the recent lax in leadership. In addition, Rainbarrel is not adjusting to the decrease in consumer spending in comparison to their competitors; however, this is the least of the company’s problems. In efforts to save Rainbarrel from continuous distress, Randall hires Hiram Phillips as the Chief Financial Officer (CFO) and Chief Administrative Officer (CAO). Hiram generates changes in the company which yields great numerical results. Hiram’s strategy includes cost cutting the budget, reduction in staff as evidenced by cos t reduction in labor, restructured sales incentives, changes in customer service procedures, and changes in the shipping process. Phillips is very proud of his success and is eager for the Corporate Executive Council (CEC) to hear his progress. Sally Hamilton and Frank Ormondy, consultants with Felding & Company are solicited by Phillips to perform baseline metrics to be tracked and  monitored in a year’s timeframe. The consultant’s findings are revealed and everything seems to lean in Hiram’s favor; however, after the meeting, the tide turns. Randall approaches Phillips regarding unsolicited information from other members of the council pertaining to the metrics Hiram has in place. Phillip makes overwhelming changes to the current organization’s systems, procedures, and processes resulting in negative feedback from Rainbarrels employees and customers. Even though the consultant’s reports give Phillips glowing results, Hiram is unaware of the damage he is causing at Rainbarrel. Problem Statement: The main problem identified in the case is the flaws in the performance management systems. Rainbarrel needs to make a dramatic change to its performance management system. The system is one-sided and not aligned with the company’s performance culture and strategic objectives. According to Kastalli, Neely, and Van Looy, (2013), â€Å"increasingly, manufacturing firms are turning to services as a new way of creating and capturing value. Despite its potential benefits, many new product-service providers struggle to deploy service activities effectively, not least because they fail to reflect the presence of service activities in their performance management systems† (p. 100). The CEO has lost sight of other key components of the company which is impacting Rainbarrel from being a successful enterprise. This fact alone questions whether or not the current leadership should be at the helm of Rainbarrel Products. Assumptions: Kerr states (2003) â€Å"the metrics program of Hiram focuses on the intermediary steps and assumes that such enhancements will make a positive impact on the bottom line† (p.31). The assumptions that highlight the main issues include the following: Hiram Phillips knew how to work within Rainbarrel’s budget. The employees are motivated by monetary means. Rainbarrel’s shipping process and customer service department are the only factors which stymies productivity. Email is the preferred vehicle of communication at Rainbarrel. Performance management is not required to align with the performance appraisal and incentive plans at Rainbarrel Hiram assumes the â€Å"fat and happy† company will be†lean and mean† within a year.  Positive results are masked by dissatisfied customers, unhappy employees, and decreased productivity unbeknownst to Hiram. Analysis: This case analysis highlights the importance of assessing, reviewing, implementing, and evaluating processes in regards to performance measurement and management systems. Wouters suggest (2009), â€Å"the importance of performance measurement systems (PMS) has been widely acknowledged. This importance pertains to all functional areas. At the same time, PMS may serve different purposes in an organization: performance measurement systems help to formulate, communicate and implement strategy throughout the organization; they are used to control and influence behavior in the organization and guide the strategic planning process† (p. 68). The aanalysis will start with a glimpse into the issues at Rainbarrel Products. These problems are preventing Rainbarrel from â€Å"picking up the pieces† of its financial and organizational crisis and moving towards a more stable and profitable footing strategically. In addition, the attitude of leadership and inability of the top senior level managers to meet organizational and individual goals resonates throughout the case study. The issues in this case are: Poor system of supervision and control on the shipping and customer service operations No structured budget process Lack of motivation and enthusiasm among employees Inadequate communication between leadership, human resources, and employees Inadequate performance appraisals and incentive plans Among the changes are incentives to answer customers’ calls quickly because the employees would now be monitored, as well as the shipment of products on time. If this does not occur, employees will be held accountable and suffer the consequences. The goal of management is conflicting with the goals of the Rainbarrel employees. Hiram Phillips drafts a rule which indicates the products should not be labeled as shipped until it was out of Rainbarrel’s doors. This is in total contrast to shipping the products from the main warehouse to a location across the street. Rainbarrel likes to emphasize customer service in its values and mission statement, but no reliable metric had been used to track what constituted â€Å"on time† and what constituted â€Å"shipped† (Kerr, 2003, p. 30). Not only are there  problems internally at Rainbarrel but on the outside as well. Longtime and loyal customer, Brenton Brothers, expresses their unhappiness of not receiving shipmen ts on-time or at their request. â€Å"In some cases I’ve been told to take a late date or otherwise forgo the purchase. That becomes the promise date but not the date I asked for,† stated by the buyer Annie, (Kerr, 2003, p. 33). Recorded evidence shows several shipment requests placed by Brenton Brothers indicate the promised shipments had left the Rainbarrel property: however, upon further investigation the shipments were found â€Å"sitting on a railroad siding across from Rainbarrel† (Kerr, 2003, p. 33). In addition, when Brenton Brothers sends e-mails to Rainbarrel’s customer service department they are experiencing late responses to questions and inquires from the call center employees. This problem is one affecting many areas of shipment and customer service. Jaaron & Backhouse (2011), state â€Å"Call centres embraced by a manufacturing organization play a major role in this endeavour as they are the main channel of contact between organizations and their customers† (p. 614). Burgers, Ruyter, Keen, & Streukens (2000) along with Meyer, Allen, and Topolnytsky (1998) indicate, â€Å"in order for organizations to achieve competitive advantage through their employees. â€Å"It is most important to equip them with high levels of affective commitment due to its fundamental links with extra role behaviour in the organization† (p. 48). There is no current protocol in place to monitor the call center for quality assurance purposes. With little or no motivation, there is no way to prove the duties are even performed on a daily basis. At this point, the employees are holding on to the only incentive they have, and that’s the salary wages paid to them now. With â€Å"Fire†em at the elm, nothing is guaranteed whether it means happy customers or not. Liu and Chang (2009) report, â€Å"interviewees were asked about how front-line employees are measured and rewarded. They have commented that the measurement of front-line employees in the call centre is done on the basis of how good they are in matching the company’s principles of serving the customer through employees’ appraisals in the call centre. The number of value-adding calls is counted against the non-value-adding calls to form the basis for measuring and evaluating employees work in general. The front-line employees in the call centre are rewarded by getting feedback and recognition on their work† (p. 619). Frezatti (2009) explains â€Å"the  budget contains the priorities and direction of the organization for a period and provides an opportunity to evaluate the entity’s performance, its internal areas and its managers.† [†¦] It is considered one of the pillars of management and a fundamental tool for accountability that exists in the organization† (p. 135). Hiram’s extreme budget cuts to make Rainbarrel ‘lean and mean†, is his only method of streamlining processes as it relates to performance management. Rainbarrel’s inadequate budget is the common denominator resulting in Hiram’s plan of budget cuts, imposing across the board workforce reduction up to 10 %, implementing the ‘wall of shame’ monitoring tool for underachieving customer care representatives and an unreliable metric regarding on time shipping. Budgets serve as a financial tool for companies, as well as a performance evaluator. Without a solid budgeting process, companies are taking a hopeful attempt to plan for expenses and sales. Hiram Phillips knows the budget is fat and happy now; however, he has not indicated any budgetary goals for the future of Rainbarrel, only short term solutions. Hiram’s metrics look good on paper, but the bottom line is his current budget metrics is displeasing to Rainbarrel’s employees and customers. According to Stern, (2013) â€Å"in theory, budgets tell you where you stand financially, and where you might be heading. In the budget process, the goals can be both individual and team, and behavioral problems may arise if the goal is too high (unattainable), if it is too easy (too vague) or if it generates conflicts between the company and the employees’ goals (goal conflict)† (p. 20) .The non existing budget structure at Rainbarrel influences production; for example, the Innovation ‘X’ project is on hold due to the fact it is not in the budget for the fiscal year, Thus, Rainbarrel is missing out on potential revenue. According to Gostick and Elton (2009), â€Å"A few misguided managers believe that 100 percent of motivation should be internally driven and that recognition is used only to motivate â€Å". Organizational behavior is emphasized on the employees’ behavior and how they perceive themselves in the organization. The impact of employee morale and lack of enthusiasm is vital for the growth of the organization. The current culture at Rainbarrel consists of lack of enthusiasm and motivation partly due to no incentive rewards programs, lack of communication between employees and leadership, and largely to layoffs. Daniel H. Pink’s Drive: the Surprising Truth about  What Motivates Us illustrates what motivates people, especially in a working environment. Pink theorizes motivation arises from reward and punishment of employees. Pink (2009) believes â€Å"human beings aren’t much different from horses – that the way to get us moving in the right direction is by d angling a crunchier carrot or wielding a sharper stick†(p. 10). The metrics, Hiram has in place, which include, reduction in labor cost, the â€Å"wall of shame†, and the change in sales commissions to employees is causing dedicated and loyal employees to become unengaged capital. The paucity of communication at Rainbarrel impacts the company as a whole. The lack of communication between Randall and Phillips causes a trickle down effect between Phillips and the workforce. Phillips does not respond wisely in communicating the changes at Rainbarrel. The case analysis, The Best Laid Incentive Plans, illustrates several examples of poor communication. Hiram does not communicate the performance metrics he plans to implement. For instance, the email policy indicates the time limit on email responses. Employees are penalized if they do not open and respond to email notification from the company. Email should not be the main method of communicating pertinent information to employees of organizations. In order to have effective performance management, there should be communication between leadership and its workforce; therefore, goals and expectations are communicated and understood of both parties. More recently, a 2008 study performed by the Pew Internet & American Life Project revealed that 72% of all full-time employees have an email account that they use for work, and 37% of those workers â€Å"check them constantly† (Madden & Jones, 2008). The CFO is hired to improve Rainbarrel’s organizational and individual performance metrics which are causing the company to fall against main competitors and industry standards. The current change initiatives show a win-win for Hiram and Rainbarrel but failed efforts for the employees. According to Barber and Strack, (2009) â€Å"today’s performance measures and management practices don’t reflect the particular economics of people-driven businesses† (p. 81). Howard does not realize problems occur in his current performance metrics. The reduction in labor cost results in unmotivated staff; streamlining of service calls by two minutes produces frustrated workers and unhappy customers, restructuring the commission sales impacts the productivity of the sales people, and Hiram’s inept ability to  operate the service and shipping department creates a weak performance management system. Smith and Mazin (2013) report , â€Å"the entire organization benefits from a system that aligns performance to company-wide goals, provides a structured format for measuring results and giving feedback, and establishes a record for each employee that can be used for individual development, to inform future supervisors, and to make sound employment decisions† (p. 49). Recommendations: During Hiram’s interview, his main goal is to do what is right in regards to Rainbarrel Products; thus, the performance metrics instituted by Phillips results in cost saving efforts but morally bankrupts the company. Examining the metrics listed in the case analysis, there are recommendations Rainbarrel should implement in order to align Hiram’s strategies and the overall wellbeing of the employees and the company. The first, Hiram should reexamine the current metrics. Without budgetary guidelines, Hiram makes cost reductions based on a sluggish economy. Hiram is not comparing prior fiscal year data to current year data. Hiram is simply basing his metrics on slumping product sales and numbers. Implementing budget structure as a tool will eliminate assumptions Hiram has of the overall performance of Rainbarrel. Packer and Teeters (2012) indicate that â€Å"the budget had grown beyond a financial tool. It is above all managerial tool; in essence, it is the best tool for making sure that key resources, especially financial resource are assigned to priorities and to results. It is a tool that enables the manager to know when to review and revise plans, either because results are different from expectation or due to environmental conditions, economic conditions, market conditions or technologies change, which no longer correspond to the assumptions of the budget† (p. 467). I would also, recommend Hiram conduct monthly budget audits for the first 5 years of implantation. Ijiri (2008) â€Å"The main purpose of budget audits is to make sure that budgeting processes are carried out as specified by budgeting principles and procedures† (p.665). The monthly audits will allow Rainbarrel to adjust the budget on an as needed basis. labor), which are the most significant expenses and the primary variable cost that audit firms incur. According to Ettredge, Bedard, and Johnston (2009) â€Å"Our study finds that asymmetric ratcheting occurs during the budgeting process (p. 15). Audit  firm management successively removes budget surpluses to a greater extent than they provide incremental budgeted hours following budget shortfalls, thus maintaining budgetary control on a continuing basis. Engagement teams also respond asymmetrically, decreasing reported hours following budget surpluses to a lesser extent than they increase reported hours following budget shortfalls† (p. 15). Referencing Bertazzi (2008), â€Å"One of the most common problems is the one in which both transportation and inventory costs are taken into account. The aim is to determine shipping policies that allow the minimization of the sum of these two costs† (p. 750). It is revealed the shipping of products promised is not occurring according to the â€Å"on-time’ ghost policy Hiram has mandated. I propose Rainbarrel implement a shipping policy. The policy should include the shipping date, which includes the shipping turn around time. Also, the policy should indicate refun ds of shipping and handling fees if the delivery is not made as promised. In the Brenton Brothers’ case, the good and services purchased from Rainbarrel are not delivered as promised. The service management is very loose in regards to the customer service representatives at Rainbarrel. There are complaints of long hold times, no return phone calls from employees and the customers are being rushed off the phone. A study conducted done by (Schalk and Van Rijckevorsel, 2007 😉 illustrates â€Å"customer service representatives (CSRs) in a call center in India are given more autonomy in the production market† (p. 77). According to Schalk and Van Rijckevorsel (2007) â€Å"Autonomy refers therefore to the ability of the worker to take over production by integrating personal work skills that could overcome the failures of the production system. The CSRs’ work requires a certain degree of autonomy. In fact, they highlight that the work organization in call centers is articulated around the standardization of the production process and the customer orientation† (p.3). Layoffs due to the economic crisis, the ‘wall of shame’, unfair s ales commissions, and limited incentives are causing low employee moral and motivation. In order to regain the respect and trust of employees, Rainbarrel’s leadership needs to decide on how to motivate its people. I suggest Rainbarrel motivate through leadership. Tebeian, (2012) notes, â€Å"The leadership style has s a direct, positive and statistically significant effect on the subordinates’ motivation† (p.1094). The leadership is definitely an influence of Rainbarrel’s culture and  strategic market sustainability. In their article published in the Havard Business Review, 2008, Nitin Nohria, Boris Groysberg and Linda Lee-eling researched an employee motivation model and incorporated Maslow’s hierarchy of needs. The model includes four drives: leadership style, motivating the team, performance, and job satisfaction. The results of the study shows needs identified by Nitin Nohria, Boris Groysberg and Linda Lee-eling are â€Å"interconnected at the brain level, and the level of fulfillment of each of them directly influences emotions , therefore behaviour as well† (p. 1094). In order for employees to support the organizations, communication is imperative. (Dolphin, 2005), â€Å"Internal communication is communication between the organization’s leaders and one of its key publics: the employees† (p. 185). I recommend Rainbarrel schedule face to face meetings, such as monthly department meetings or team huddles with front line managers, employees, and stakeholders. In the case analysis, email is the preferred route of communication; however, important information is being misconstrued. Chong (2007), studying Singapore Airlines, found that focusing on face-to-face dialogue between management and staff helped the airline deliver its brand promise to its customers through its employees (p.203). Another recommendation to improve communication at Rainbarrel is initiate written communication via the company’s intranet site. The implementation of a company intranet site will convey important information regarding the company’s strategy, policy changes, and forecasted issues. A secure intranet site is ideal to broadcast convey information to the company employees. Borden adds (2010), â€Å"the company’s intranet must be organic and ever-changing, ready to embrace and depl oy new communication technologies that facilitate information sharing across the company† (p.44). According to Barber and Strack (2005), â€Å"when people are your most important resource, some standard performance measures and management practices become ill suited to their tasks† (p. 81). The current performance metrics and incentives at Rainbarrel have impacted negatively on employees. The performance management and measurement system should meet the needs of employees and Rainbarrel. I propose the CEO implement performance appraisals and fair incentive awards. Bacal (2004) points out â€Å"Performance appraisals enable employers and employees to define, communicate, and review expectations, goals, and progress in achieving strategic objectives. The  purpose is to improve the way employees contribute to an organization’s goals and job performance. Appraisals are also intended to sustain, improve, and help an employee† (p. 21). Dunlap (2010)† Distinguish and reward your top performers in a manner that is fair—not equal, but perceived as fair and justified† (p. 10).

Position Paper: Pepsico’s Restaurants

Position Paper: PepsiCo’s Restaurants Pepsi Co’s Restaurants is a Harvard Business School Case which states PepsiCo’s large organization, its structure, its acquisitions and management approach. It also covers two companies, Carts of Colorado (COC) and California Pizza Kitchen (CPK) which are pursued from PepsiCo in 1991 to buy. In this position paper PepsiCo’s acquiring strategy and management approach will be evaluated to examine strengths and weaknesses of acquiring these two companies and possible solutions of other strategies. It will be also qualified whether it is a successful company in restaurant business.Pepsi’s acquiring strategy is diversified. First, it merged with Frito-Lay in 1965 and named PepsiCo. The case states the belief of Kendall that â€Å"snack chips went well with soda. † It was a product-extension merger. These two companies were selling different but related products in the same market. Snack foods and soft drinks a re related. With the help of established distribution network and brand recognition the merge resulted higher growth and economies of scale. This synergy was the basis of further developments. After that PepsiCo. acquired restaurant chains, which was the third segment for the company. You can read also Classifications of RestaurantsPepsiCo made market-extension and also product-extension with this purchase. It acquired the largest chains like Pizza Hut, Taco Bell at late 70’s and KFC in 1986. (Exhibit 1) With their economies of scale, it created market access for its own products and the restaurants could make cost reduction and cost efficiency with the growth of PepsiCo through soft drinks and also similar purchases. (PepsiCo Food Systems) Additionally, the acquirements of KFC with its franchises (Exhibit 5) was important because it helped PepsiCo to be internationally powerful.For this purpose, they used also a different strategy for their snack food segment and acquired Smith Crisps, Ltd from United Kingdom which was its competitor for European market. (horizontal acquisition) Besides, PepsiCo purchased supplier companies like bottling subsidiaries as backward integration (instruments of standard-cycle approach like PepsiCo Food Systems, cost efficiency is very important ) and also conglomeration like Wilson Sporting Goods, but they sold what they acquired when the parts are not greater than the whole. PepsiCo has decentralized management approach.Every decision didn’t taken by top management. The responsibility for authority and decision making is distributed. Pepsi commercial which included Michael Jackson with a 5$ million record fee was told CEO only a few hours before the contract. Moreover, Kendall encouraged managers to take risks and stated â€Å"If you go through your career and never make a mistake, you’ve never tried anything worthwhile† and the president of Pizza Hut, Steve Reinemund mentioned that Calloway, the follower CEO after Kendall, had never told him what to do.These are typical examples for decentralization, but it also shows us that there is a tradition at PepsiCo, the top management showed their managers their trust and tried to challenge their thought process. This is the result of Pepsi Co investment on them. Calloway’s response for outstanding performance was â€Å"the three P’s people, people, people†. Such decision makers should be experienced. Actually their two phase system was very successful because it let successful managers to promote another divisions, challenging positions or different functional areas.Most of the top management which can be seen from organization chart (Exhibit 2) had participated at all levels of PepsiCo with different assignments, so they were generalists and great managers with different experiences. Their management approach can be described as Calloway states â€Å"We take eagles and teach them to fly in formation. † Carts of Colorado and California Pizza Kitchen were two companies that PepsiCo. were interested to acquire. The advantages and disadvantages of such acquisitions will be considered separately.But first of all, we have to consider what was the strategy of PepsiCo for the future and what Pepsi Co has experienced. According to strategic planners of the company quick service restaurants would remain the largest segment over the following decade. Based on their analyses, quick service, casual dining and take out segments would be attractive. On the other hand, PepsiCo. invested to casual dining like Pizza Hut Cafe and experienced that their know-how for this segment is low. (Reinemund: â€Å"We needed people to come in and break the mold of our thinking.We knew enough to know what we didn’t) Additionally, Salsa Rio Grill which is also an investment for casual dining was a failure, but it has also mentioned it could be successful with a different setting. These are aspects that we have to think whether to acquire CPK. The case also mentions that PepsiCo. needed non-traditional program to increase points of distribution. That can be achieved with carts. The company also purchased carts from COC because they saw a potential future that the location of sales was really i mportant. If COC is acquired, than PepsiCo ould acquire skills or technologies more quickly or at lower cost than they could be built in-house. This can be seen as a strength, however COC’s carts wouldn’t cover the core competence of PepsiCO, therefore its acquisition could be not cost efficient. There is also an opportunity of first mover with the know-how of COC PepsiCo could achieve the most efficient mobile storesi, might be also apply some strategies for automats. The threat was that COC has a centralized organization, because of adaptation problems whole project could be a failure. Acquisition of CPK has strengths according to its operating segment of casual dining.The weakness could be because of its cost comparing to its benefit. Strategic planners saw casual dining segment a growth market and with its know-how they would expand their market. Its threat is centralized structure of CPK. They failed with Pizza Hut Cafe and Salsa Rio Grill and it could also happen with CPK if they apply their quick service strategies. According my point of view PepsiCo should not acquire CPK because PepsiCo. ’s tradition is very powerful and they want to adopt their strategies to CPK, but added value and core competence of this companies is its centralized structure.If they act so, they will fail, instead of acquiring synergy. Additionally, the economies of scale CPK is also small which would not add value to its soft drink segment, the acquirement of other restaurant chains was also beneficial for brand awareness and reputation, this wouldn’t happen for CPK. They would acquire it for know-how of this company, but the company is not public and centralized, everything will depend on cofounders of CPK, this a very big risk if we compare benefits and its cost.On the other hand, PepsiCo could acquire COC, but they could make a technology contract with such a company. In such a contract the threat is the benefit, the synergy with experience of Pepsi Co and know-how of COC can be extraordinary. If COC shares the results to other competitors, that wouldn’t be a one sided gain, so comparing with its cost, it would be much better to acquire it because built-in of such department would be also very costly. As a result, I want also add my comments about the success status of Pepsi in restaurant business. I believe, it is successful.Although its history is short comparing with soft drink segment, its revenue is greater than soft drink segment and this is a success, PepsiCo differentiated its products, it made a great purchase system for cost effectiveness, but it had to increase its profitability according to 1991 data. Although it covered 36% of PepsiCo sales, but operating profit was 29% and as we knew from case, PepsiCo main strategy was investing to where it believed it could achieve the highest returns. (Exhibit 4) Reference: http://www. mckinseyquarterly. com/The_five_types_of_successful_acquisitions_2635 PepsiCo’s Restaurants Harvard Business School Case Position Paper: Pepsico’s Restaurants Position Paper: PepsiCo’s Restaurants Pepsi Co’s Restaurants is a Harvard Business School Case which states PepsiCo’s large organization, its structure, its acquisitions and management approach. It also covers two companies, Carts of Colorado (COC) and California Pizza Kitchen (CPK) which are pursued from PepsiCo in 1991 to buy. In this position paper PepsiCo’s acquiring strategy and management approach will be evaluated to examine strengths and weaknesses of acquiring these two companies and possible solutions of other strategies. It will be also qualified whether it is a successful company in restaurant business.Pepsi’s acquiring strategy is diversified. First, it merged with Frito-Lay in 1965 and named PepsiCo. The case states the belief of Kendall that â€Å"snack chips went well with soda. † It was a product-extension merger. These two companies were selling different but related products in the same market. Snack foods and soft drinks a re related. With the help of established distribution network and brand recognition the merge resulted higher growth and economies of scale. This synergy was the basis of further developments. After that PepsiCo. acquired restaurant chains, which was the third segment for the company. You can read also Classifications of RestaurantsPepsiCo made market-extension and also product-extension with this purchase. It acquired the largest chains like Pizza Hut, Taco Bell at late 70’s and KFC in 1986. (Exhibit 1) With their economies of scale, it created market access for its own products and the restaurants could make cost reduction and cost efficiency with the growth of PepsiCo through soft drinks and also similar purchases. (PepsiCo Food Systems) Additionally, the acquirements of KFC with its franchises (Exhibit 5) was important because it helped PepsiCo to be internationally powerful.For this purpose, they used also a different strategy for their snack food segment and acquired Smith Crisps, Ltd from United Kingdom which was its competitor for European market. (horizontal acquisition) Besides, PepsiCo purchased supplier companies like bottling subsidiaries as backward integration (instruments of standard-cycle approach like PepsiCo Food Systems, cost efficiency is very important ) and also conglomeration like Wilson Sporting Goods, but they sold what they acquired when the parts are not greater than the whole. PepsiCo has decentralized management approach.Every decision didn’t taken by top management. The responsibility for authority and decision making is distributed. Pepsi commercial which included Michael Jackson with a 5$ million record fee was told CEO only a few hours before the contract. Moreover, Kendall encouraged managers to take risks and stated â€Å"If you go through your career and never make a mistake, you’ve never tried anything worthwhile† and the president of Pizza Hut, Steve Reinemund mentioned that Calloway, the follower CEO after Kendall, had never told him what to do.These are typical examples for decentralization, but it also shows us that there is a tradition at PepsiCo, the top management showed their managers their trust and tried to challenge their thought process. This is the result of Pepsi Co investment on them. Calloway’s response for outstanding performance was â€Å"the three P’s people, people, people†. Such decision makers should be experienced. Actually their two phase system was very successful because it let successful managers to promote another divisions, challenging positions or different functional areas.Most of the top management which can be seen from organization chart (Exhibit 2) had participated at all levels of PepsiCo with different assignments, so they were generalists and great managers with different experiences. Their management approach can be described as Calloway states â€Å"We take eagles and teach them to fly in formation. † Carts of Colorado and California Pizza Kitchen were two companies that PepsiCo. were interested to acquire. The advantages and disadvantages of such acquisitions will be considered separately.But first of all, we have to consider what was the strategy of PepsiCo for the future and what Pepsi Co has experienced. According to strategic planners of the company quick service restaurants would remain the largest segment over the following decade. Based on their analyses, quick service, casual dining and take out segments would be attractive. On the other hand, PepsiCo. invested to casual dining like Pizza Hut Cafe and experienced that their know-how for this segment is low. (Reinemund: â€Å"We needed people to come in and break the mold of our thinking.We knew enough to know what we didn’t) Additionally, Salsa Rio Grill which is also an investment for casual dining was a failure, but it has also mentioned it could be successful with a different setting. These are aspects that we have to think whether to acquire CPK. The case also mentions that PepsiCo. needed non-traditional program to increase points of distribution. That can be achieved with carts. The company also purchased carts from COC because they saw a potential future that the location of sales was really i mportant. If COC is acquired, than PepsiCo ould acquire skills or technologies more quickly or at lower cost than they could be built in-house. This can be seen as a strength, however COC’s carts wouldn’t cover the core competence of PepsiCO, therefore its acquisition could be not cost efficient. There is also an opportunity of first mover with the know-how of COC PepsiCo could achieve the most efficient mobile storesi, might be also apply some strategies for automats. The threat was that COC has a centralized organization, because of adaptation problems whole project could be a failure. Acquisition of CPK has strengths according to its operating segment of casual dining.The weakness could be because of its cost comparing to its benefit. Strategic planners saw casual dining segment a growth market and with its know-how they would expand their market. Its threat is centralized structure of CPK. They failed with Pizza Hut Cafe and Salsa Rio Grill and it could also happen with CPK if they apply their quick service strategies. According my point of view PepsiCo should not acquire CPK because PepsiCo. ’s tradition is very powerful and they want to adopt their strategies to CPK, but added value and core competence of this companies is its centralized structure.If they act so, they will fail, instead of acquiring synergy. Additionally, the economies of scale CPK is also small which would not add value to its soft drink segment, the acquirement of other restaurant chains was also beneficial for brand awareness and reputation, this wouldn’t happen for CPK. They would acquire it for know-how of this company, but the company is not public and centralized, everything will depend on cofounders of CPK, this a very big risk if we compare benefits and its cost.On the other hand, PepsiCo could acquire COC, but they could make a technology contract with such a company. In such a contract the threat is the benefit, the synergy with experience of Pepsi Co and know-how of COC can be extraordinary. If COC shares the results to other competitors, that wouldn’t be a one sided gain, so comparing with its cost, it would be much better to acquire it because built-in of such department would be also very costly. As a result, I want also add my comments about the success status of Pepsi in restaurant business. I believe, it is successful.Although its history is short comparing with soft drink segment, its revenue is greater than soft drink segment and this is a success, PepsiCo differentiated its products, it made a great purchase system for cost effectiveness, but it had to increase its profitability according to 1991 data. Although it covered 36% of PepsiCo sales, but operating profit was 29% and as we knew from case, PepsiCo main strategy was investing to where it believed it could achieve the highest returns. (Exhibit 4) Reference: http://www. mckinseyquarterly. com/The_five_types_of_successful_acquisitions_2635 PepsiCo’s Restaurants Harvard Business School Case

Thematic essay 2 Example | Topics and Well Written Essays - 750 words

Thematic 2 - Essay Example In â€Å"I Stand Here Ironing,† a mother reflects on her struggle to raise her daughter Emily during the harsh years of the Great Depression and the World War. She questions the decisions she has made and their effect on her daughter. The mothers are the narrators in â€Å"Everyday Use† and â€Å"I Stand Here Ironing.† Another point of similarity in the two stories is the sibling relationships. Walker’s Dee and Maggie, and Olsen’s Emily and Susan, are sisters whose interactions play important roles in the development of the narratives. The two pairs of siblings experience similar treatment from their mothers, and have similar personalities and sibling relationships. Maggie in â€Å"Everyday Use† and Emily in â€Å"I Stand Here Ironing† are treated in similar ways by their mothers. Maggie and Emily are the elder daughters in poor households. In these circumstances, they are called upon to share a significant part of the mothers’ domestic burdens. Maggie cleans the yard, stays back in the kitchen to wash-up after dinner and, unlike her sister, knows all the household tasks, including quilting. Her position is the family is â€Å"like somebody used to never winning anything, or having anything reserved for her† (Walker, 74). In the same way, Emily is obliged â€Å"to help be a mother, and housekeeper, and shopper† (Olsen, 5). Maggie and Emily bear the brunt of the family’s poverty. ... Walker’s narrator placidly condones the selfishness of the successful Dee, who has carved a place for herself in the outside world, and takes for granted the stay-at-home Maggie, who stoically bears her modest lot. Similarly, Olsen’s mother admits that, unlike her younger siblings, Emily is â€Å"a child of her age, of depression, of war, of fear† (Olsen, 7). It is clear that the younger siblings, Dee and Susan, receive preferential treatment from the two mothers. The mothers come to acknowledge this discrimination. Maggie’s mother makes amends by refusing to give Dee the quilts, while Emily’s mother hopes the Emily will â€Å"find her way† (Olsen, 7) in the future. The siblings in the two stories also share appearances and personalities. Maggie is â€Å"homely and ashamed of the burn scars down her arms and legs† (Walker, 2). She shuffles and sidles up to people, is afraid to meet strangers and totally lacks self-confidence. Her mothe r declares, â€Å"She knows she is not bright. Like good looks and money, quickness passes her by† (Walker, 13). Similarly, Emily’s walk is nervous. Her skin is scarred by pock marks and she stammers in class. Her mother says â€Å"She was not glib or quick† (Olsen, 4). In contrast, the younger siblings are pretty and confident. Dee is â€Å"lighter than Maggie, with nicer hair and a fuller figure† (Walker, 10). She is attractive, extroverted, confident and ready to take what she wants. Likewise, Susan is â€Å"golden and curly haired and chubby, quick and articulate and assured, everything in appearance and manner Emily was not† (Olsen, 5). The mothers themselves admit that the elder girls are inferior to their younger siblings in attractiveness and personality. The two pairs of siblings experience

Principles of Economics Essay Example | Topics and Well Written Essays - 750 words - 2

Principles of Economics - Essay Example At ceteris peribus, an increase in the prices of alcohol will cause a fall in the quantity demanded and consumed of a product (Becker, 2001). This would help mitigate the economic impacts of over consumption of alcohol. However, the economists must put into consideration the fact that the demand curve of alcohol is normally inelastic given the fact that it is addictive. They therefore have to realize that an increase in the tax level may lead to a small decline in the quantity of the product consumed. The second option that can be pursued by an economist is moral persuasion. In this case, economists will prefer explaining the marginal cost and marginal benefits of consuming alcohol. In this case, the marginal cost will be higher than the marginal benefits hence economists will promote campaigns against the use of alcohol (Frank & Bernanke, 2007). They will therefore influence the enactment of legislation to bar teenagers from using alcohol; limit the number of drinking hours among ot her measures that reduce the consumption level. When some drugs are prescribed for use, they will influence the demand and supply of other products. For instance, the demand for products used in the manufacture of a drug will increase if the quantity of the drug prescribed has been increased. ... The elasticity of the two curves will determine the effectiveness of the policies formulated to regulate the performance of the economy. A shift in the supply curve will lead to a change in the new equilibrium point. If the demand curve were inelastic, a huge shift in the supply curve would result into relatively small changes in the equilibrium price (Boyes & Melvin, 2008). Elasticity of the demand curve will therefore influence the economic impact of the shift in the supply curve. For instance, a shift in the supply curve would only result in an increase in the equilibrium price if the demand curve were perfectly inelastic. Policymakers will therefore determine the effectiveness of their decisions when considering the steepness of the demand curve (Frank & Bernanke, 2007). Similarly, the elasticity of the supply curve will influence the net effect of a shift in the demand curve. Where the supply is inelastic, a shift in the demand curve will cause little or no change in the equilib rium quantity because even with an increased demand, suppliers will not be able to expand the quantities supplied. Prices will therefore increase but the quantity supplied will remain relatively constant. The elasticity of either the demand and supply curves are normally important when formulating policies aimed at influencing economic performance i.e. the government can increase the taxes imposed on goods with inelastic demand because this would not significantly affect the amount of the good consumed (Becker, 2001). For an increasing cost industry, entry of a new firm will result in an increase in the unit cost of production. When a firm enters the market, it will cause the prices of the resources used in

Palliative care Essay Example | Topics and Well Written Essays - 1750 words - 1

Palliative care - Essay Example It is implementable for any age and/or stage with serious illness. This is generally provided with curative treatment which has proven to be even more helpful, however for treatment of last stage cancers curative intent is rationally set aside while providing palliative care alone. The concept care started in 2006 in the United States which late matured into a board certified program having specialties in sub-groups of diseases. It is now a multidisciplinary approach for patient care. The terminology differentiates from Hospice Care in certain respects. Palliative Care is given to chronically ill patients and have serious prognosis whereas Hospice Care is given to patients that have less than six months to live if the illness follows its usual course. World Health Organization states that Palliative Care is an approach which improves quality of living of patients and their ambiance who face problems which are life threatening, their prevention, cure and relief involve early identification, apt assessment and their physical, psychosocial and social treatment (WHO, 2009). Palliative Care refers to care which alleviates symptoms and there cure is not possible through simple procedures. It addresses side effects and involves a careful chemotherapy and other relevant measures. It is pertinent to mention here that the term ‘Palliative Care’ involves administration to diseases like cancer, renal disease, chronic heart failure, HIV/AIDS, progressive pulmonary disorders and progressive neurological problems like complicated Schizophrenia. The treatments in above mentioned cases cause psychological, social, spiritual and physical distress. And Palliative Care causes this aggravated condition complex to mitigate. Like emergency care, Palliative Care has its own significance which is substantial. This section deals with the communication

Research Methods Coursework Example | Topics and Well Written Essays - 2000 words

Research Methods - Coursework Example Organizations have therefore continued to struggle with the challenges that impact on the performance of managers and employees, which contributes greatly to dealing with competition within the various industries. Managers and employee performance is a theory of management within organizations that takes on various perspectives and purposes with the traditional purposes being the organization having good planning systems which serve as a means of meeting up the work expectations for managers and employees. An organization should have effective ways in which they are able to monitor performance and have ways in which an organization is able to develop the capacity of employees in performance and putting in place appropriate reward systems which motivate employees, thus resulting to good performance (Baldwin, 2008). Research question My project answers and reviews the extent to which performance of employers and employees in an organization is limited by relevant factors. Aim The proje ct seeks at ascertaining the factors that limit employees and employers within an organization’s environment. Research paradigm The paper will make use of realistic research paradigm especially because of its ability to take in the aspects of positivism and constructivism. Through the realistic research paradigm, it will be possible for me to hold on the notion that real structures exist and bring in knowledge and consciousness as aspects that look at human knowledge differently. According to the realistic paradigm, social and natural science are differentiated, while social reality is reinterpreted. Use of the realistic research paradigm was chosen because of its ability to take on a wider perspective, by bringing together the assumptions of positivism paradigm and the constructivism paradigm (John, 2005). Methodology/Research strategy My project will make use of both qualitative and quantitative research methods. First-hand information method will include the use of persona l interviews and well structured questionnaires with well-organized questions, which will be administered to employers and employees within organizations in different industries. I will use secondary data sources such as books and journals that look at the limitations of employees and employers performance in organizations, through analysis of theories and previous research on performance. Literature Review Basically, organizational performance takes into account actual results of a particular organization as measured against the intended goals and expectations within a specified period of time. Performance is therefore the end result of an organization while organizational performance at large refers to the accumulated results of an organization’s work processes and activities. Organizational aspects therefore take in activities within an organization that are concerned with the activities, goals and their monitoring and adjustment, to ensure they contribute effectively towa rds an organization (Kirkpatrick, 2010). Employers and employees have been appreciated and recognized as the major aspects of organizational performance in any industry. Good managers and employees’ performance contributes to the ability of an organization to fulfill its mission and visions, which is complemented by sound management, strong governance and persistence towards the results. Employee performance also takes in perspective employee performance

Oreos Advertising With Breastfeeding Essay Example | Topics and Well Written Essays - 500 words

Oreos Advertising With Breastfeeding - Essay Example In fact, this is the practice that should be promoted because babies are now being bottle fed where they do not get all the nutrients they need. It only portrayed an idealized reality that babies should be breast fed and that there is nothing wrong with the image of a baby being nursed by his or her mother. It made a big difference when the ad was created by a reputable agency such as Cheil Worldwide because the ad was taken seriously and cannot be easily dismissed. Especially when it was shown during awards gathering in South Korea where it becomes credible and reputable. It may be controversial but it cannot be readily dismissed as something obscene or improper because the ad was created by an advertising agency composed of professionals trained and educated in advertising. This made the people looked at the message of the ad closely that breastfeeding mothers liked the message. The creator Cheil Worldwide put ethos or credibility to the ad for it to be taken seriously and not be e asily dismissed. The effective use of rhetorical devices such as pathos (emotional appeal), logos (logical appeal) and ethos (credibility) made the Oreo advertisement powerful that it stirred controversy. In fact, the attention was drawn away from the cookie that image intends to advertise but instead, the focus was centered on the image. It is so powerful that it even raised awareness about breastfeeding and was suddenly transformed from merely an advertisement that intends to sell cookies to an advocacy material for breastfeeding.