Techno Smart is a Korean company which produces high technology goods such as biometric scanners, semiconductors, and chipsets. Recently they opened a factory in the town of Nottingham, an economic development area. The factory is doing well with 69% of its sales coming from the British market. However, relations with the local population are poor. The anticipated benefits to the town from the building of the factory haven't materialized, as most of the workforce needed to be highly skilled and were brought in from other areas, thus providing little local employment. These non-locals were highly paid and have pushed up prices in the local shops and also house prices leading to resentment. The chairman is aware of this resentment and wants to improve the situation. The directors have agreed that up to 300,000 may be spent on a scheme to benefit the community and lift the company's image in the community Three possible schemes have been put forward: Scheme 1: The local hospital wants to set up a new heart disease unit. A donation of 300,000 would make this possible. Scheme 2.: The Nottingham Arts Centre (NAC) is a prestigious cultural center for young people. A musical group of NAC has been invited to tour five major cities in France to do concerts. The company could enter into a contract to pay the Arts Centre 100,000 for the next four years. Scheme 3 The local football club Nottingham United are a Championship Division club sometimes seen on TV. 250,000 would advertise the company in the ground and on the team's kits for two years. The views of the Chairman and Directors are as follows The Finance Director the Finance Director's Calculations: Scheme 1. No tax savings would accrue. Scheme 2. Tax savings from this would be 25,000 p.a. Scheme 3. A tax saving of 100,000 would accrue from this. The Marketing Director feels: Scheme 1 would scarcely increase sales at al1. The unit would be small but the publicity would be very positive. Scheme 2 would give a moderate increase to sales in France. The company is shortly to launch a marketing operation in France and though there would be no advertising, the company's involvement would be publicized. Scheme 3 would have a major impact on sales. Some problems are that cricket is as popular as football in Nottingham and the club has been associated with creating rowdiness often. The Chairman has said that he would like to see other benefits to the company as well as the public relations boost. TASK: The Chairman has asked you, as a promising young manager, to study the three proposals and make a recommendation on which of the schemes the company should support and why for consideration by the Board of Directors at its next meeting. Only one of the schemes can be supported. After examining all the information say which scheme the company should support and give your reasons. Write according to strategic management subject in Business studies Techno Smart is a Korean company which produces high technology goods such as biometric scanners, semiconductors, and chipsets. Recently they opened a factory in the town of Nottingham, an economic development area. The factory is doing well with 69% of its sales coming from the British market. However, relations with the local population are poor. The anticipated benefits to the town from the building of the factory haven't materialized, as most of the workforce needed to be highly skilled and were brought in from other areas, thus providing little local employment. These non-locals were highly paid and have pushed up prices in the local shops and also house prices leading to resentment. The chairman is aware of this resentment and wants to improve the situation. The directors have agreed that up to 300,000 may be spent on a scheme to benefit the community and lift the company's image in the community Three possible schemes have been put forward: Scheme 1: The local hospital wants to set up a new heart disease unit. A donation of 300,000 would make this possible. Scheme 2.: The Nottingham Arts Centre (NAC) is a prestigious cultural center for young people. A musical group of NAC has been invited to tour five major cities in France to do concerts. The company could enter into a contract to pay the Arts Centre 100,000 for the next four years. Scheme 3 The local football club Nottingham United are a Championship Division club sometimes seen on TV. 250,000 would advertise the company in the ground and on the team's kits for two years. The views of the Chairman and Directors are as follows The Finance Director the Finance Director's Calculations: Scheme 1. No tax savings would accrue. Scheme 2. Tax savings from this would be 25,000 p.a. Scheme 3. A tax saving of 100,000 would accrue from this. The Marketing Director feels: Scheme 1 would scarcely increase sales at al1. The unit would be small but the publicity would be very positive. Scheme 2 would give a moderate increase to sales in France. The company is shortly to launch a marketing operation in France and though there would be no advertising, the company's involvement would be publicized. Scheme 3 would have a major impact on sales. Some problems are that cricket is as popular as football in Nottingham and the club has been associated with creating rowdiness often. The Chairman has said that he would like to see other benefits to the company as well as the public relations boost. TASK: The Chairman has asked you, as a promising young manager, to study the three proposals and make a recommendation on which of the schemes the company should support and why for consideration by the Board of Directors at its next meeting. Only one of the schemes can be supported. After examining all the information say which scheme the company should support and give your reasons. Write according to strategic management subject in Business studies