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equipment manufacturers. Profit for the last two years have been lets than expected. Mandy Confer, owner af Banaister, was convinced that her firm neeced to adapt a tevenue prowith and cost refuction strategy to increase ovorail profite. After s caraful reviow of her fitm's condition, Mandy realized thet the moin obstacle for increasing revenues and reducing costs was the high dafact rate of har preducts (a bi percact reject rate). She was certain that revenues wou'd grow if tha defect rate was reduced dramaticativ. Coite would also decline os there weuld be fewer relects and less rework. Ey decreasing the defect rate, customer catizfaction would increase, cousing, in turn, an increase in market ahare. Mandy olso felt that the following setions were neteded to help enstre tha success of the revenue-growth and cost reduction strategy? a. improve the soldecing capsbilities by sending employees to an outside course. b. Redesign the insertion process to eliminate some of the common mistakes. c. Improve the procurement process by selecteng suppliers thot provide Migher-quality circuit boards. Suppose that Mandy communicates the following weights to har CeO: Perspectivet: Financial, 37\%: Customer, 1790; Process, 16\%; Leaming bi growth, 28\% Fin ancial objectives: Profas, 46 wo; Revanues, 29\%; Costs, 25% Cistomer objectivest Customer satisfaction, 51 wo, Market shore, 49% Process objectives: Defects decreose, 35sw: Supplier seiection, 324th; Redesign procett, 33\% Learning a growth objective: Tre ining, 100% Mandy next sets up a bonus pool of 5100,000 and inslcotes thot the weighting scheme just described will be used to detarmine the amount of potential benus foc each perpoctive and each objective. 1. Calculate the potential bonus for each perspective. Calculate the potential bonus for each objective. 2. Deseribe how Mandy might award actual bonuses so that her monegers will be encoureged to implement the 0slarced 5 carecsrd. 3. Which of the listed items is not a method that Mandy should conslider in order te encouroge alignimeot with the company's atratepe objectives (othar then incentive compensation)? Ablanced Secorveaty, Stratiogle Algriment. tho cast reduetion stretegy to:increase overali profics: 3uccess of the revenue growth and cost reduction strategys a. tmprowe the soldering capabilities by sending employees to an outside course. b. Redesign the insertion process to eliminate some of the common mistakes c. Impreve the procurement process by selecting suppliers that provide highter-qualify circuit boards. Suppose that Mandy communicates the following weights to har CEO: Financial objectives: Profits, 467i, Revenues, 2950; Costs, 254 customer objectives: Customer satisfaction, 51961 Market share, 49 of Process objectivest Defects decreabe, 35\%; Supplier selection, 32wp; Fiedesign process, 33s. Learning A growth objectives Training, 100%
