ABC Manufacturing Inc. ABC Manufacturing Inc. has adopted the following goals: - to maximize productivity, - to constantly improve quality o [Because of the importance of quality, the organizational structure gives quality assurance special treatment.] - to ensure that shareholders' value is stable. The basic organizational structure of ABC follows a traditional hierarchical structure, consisting of: - Board of Directors, - Chief Executive Officer (CEO) [answers to the Board][ABC is an investment centre], - Chief Operations Officer (COO) [answers to the CEO], - Head of Quality Assurance [answers to the Board] - Production department heads [there are 2 product lines] [each answers to the COO] - Sales manager who heads up a group of salespeople [profit centre] who all sell both product lines [answers to the CEO]. NOTE: Employees are organized by department. NOTE: Because of the importance of quality to ABC, the head of Quality Assurance is considered to be on a par with the CEO in terms of importance and decision rights in the management structure. Each product line is led by a production department [each is a cost centre] head who makes decisions and addresses production issues for their product line. Quality issues are resolved unilaterally by the head of Quality Assurance. Production department heads focus on general productionpolicies.

Assume that the head of Quality Assurance (Jim Morrison) has been allocated $50,000. by the Board of Directors to allocate as he sees fit to one or both or all or neither of the Production Departments (A is managed by Judy Grant and B is managed by Larry smith). The purpose of these funds in the words of the Board of Directors is to "Improve quality of our products so as to improve customer satisfaction". Jim has come to you with the following question: What factors should I consider when deciding how to allocate these funds to Departments A and B? Jim also told you that both Judy and Larry have been after him for additional funds to invest in their own Department. Required Using content / concepts from the text materials covered to date, respond to Jim's question. Explain what additional information you require in order to provide Jim with a response to his question. Explain how you would use this additional information in formulating your response. [You are to submit 3 items/concepts - EACH with 3 "factors to consider" AND EACH with 3 pieces of "additional information and use" Organize your submission as follows: i. Chapter and item / concept ii. Factors to consider in Jim's situation iii. Additional information and use.