As an executive manager you are asked to assign bonuses and raises to the staff.Unfortunately this year, the company has not been as profitable as hoped.Your staff consists of 5 employees with the following information.

Salary

Average Performance Rating

Other Information

Employee 1

$75,000

4 of 5

Single, hard worker, your right hand

Employee 2

$75,000

3.5 of 5

Sole income maker for a family of 7

Employee 3

$35,000

4 of 5

Fresh from college, high potential employee

Employee 4

$35,000

4.25 of 5

Career assistant, does this job very well,

promotion is not an option

Employee 5

$30,000

3.5 of 5

Singe, young worker has limited potential

but does job reasonably well.

Yourself

$200,000

4 of 5

This year you have $10,000 to allocate to yourself and the staff which is a 2.2% increase in compensation costs which is slightly less than the 3% cost of living increase in the economy.

As the executive, you may allocate the $10,000 in raises however you wish on whatever metrics you choose.

Discuss possible (at least 3) allocation methods you may consider, including the reasoning behind the allocation method