Tom Emory and Jim Morris strolled back to their plant from the administrative offices of the Ferguson & Son Mfg. Company. Tom is the manger of the machine shop in the company’s factory. Jim is the manager of the equipment maintenance department. The men had just attended the monthly performance evaluation meeting for plant department heads. These meetings had been held on the third Tuesday of each month since Robert Ferguson, Jr., the president’s son, had become the plant manager a year earlier. As they were walking, Tom Emory spoke. “Boy, I hate those meetings! I never know whether my department’s accounting reports will show or bad performance. I am beginning to expect the worst. If the accountants said I saved the company a dollar, I’m called…
Regina Company Inc. was known as a complacent slow-growth company and was dominated by Hoover and Eureka within the floorcare industry. Donald Sheelen was a promising young individual when he was hired first as the head of the marketing division in Regina, and then became its president. Shortly after becoming company president, Sheelen set out to make Regina the industry’s number one company and repeatedly vowed to “bomb” Hoover, the number one firm in the industry at the time. Sheelen expanded Regina’s product line and started an aggressive advertisement campaign to promote Regina’s products over Hoover’s. His strategy paid off, as Regina’s profits grew substantially, and after Regina went public, its stock price soared by nearly 500 percent, making Sheelen and the company’s other principal stockholders millionaires many times over. However, it turned out that the impressive financial figures released by Regina after it went public were fabricated by Sheelen. “Instead of a growth company with bright prospects, Regina was a dying company mired in mounting losses.” The major reason behind Regina’s financial difficulties was the poor quality of its new products, which resulted in a reported 50 percent customer return rates. After realizing that Regina was in a deep trouble, Sheelen, with the help of Regina CFO Vincent Golden, came up with several illicit accounting schemes to keep the company’s stock prices at a high level. In addition to significantly understating customer product returns and company’s cost of goods, they recorded bogus sales to inflate sales revenues, and implemented a so-called “ship-in-place” booking scheme. After realizing that he could no longer conceal the company’s deteriorating condition, Sheelen decided to let the public know of the company’s dire financial condition. Although Sheelen and Golden initially blamed the computer system for errors, they later pleaded guilty to federal mail and security fraud charges in 1989. Sheelen…
The compensation package achieved Sunbeam’s goals of maximizing shareholders wealth. It motivated Dunlap to drive up the price of the stock. Although the short term profits benefited shareholders, no incentives to create a long term, profitable company existed. In fact, it gave Dunlap an even bigger incentive to sell the company once the stock price reached a high, favorable value. Dunlap’s compensation package consisted of little to no risk and had a ten year term. The restricted stock rewards became vested in two years. His purchase of 244,898 shares indicated that profits would drastically increase. Dunlap’s compensation package affected thousands of employees at Sunbeam. The compensation package favored shareholders but disfavored employees. They had no value in this model. The compensation package only protected shareholders wealth. The structure of Dunlap’s compensation package was aligned his views of shareholder primacy. He sacrificed values for a boost in stock price and economic efficiency. The stockholders of Sunbeam greatly profited, and Dunlap reaped a majority of the benefits. The compensation package should relate to performance in order to produce the right incentives. The compensation package provided Dunlap with an excessive amount of shares of stock and stock rewards, but at least it provided an…
their industry. Dick's Sporting Goods was, and still is, the leading sports industry retailer in terms of revenue. They continue to provide outreach within the communities, and they have established financial prosperity with investors and their shareholders.…
sharp decline in the company's revenues. She asks her team to diagnose the issue and…
The company will share the wealth they have created. MoniMed had a choice to make a profit for shareholders; however, the CEO decided to keep millions leaving stockholders in the red.…
3. Fans who attend sporting events primarily for the social interaction or entertainment benefit of the event are said to possess _____.…
Two young college graduates, obtained their first jobs at a relatively small family owned business dealing in technology. A pull factor for the two young adults was that the firm consisted of five sales people who had credited an organization with a positive moral and strong communication channels. The 2007-2008 economic recession hit and affected the small business quite heavily. Upper management decided to get rid of the clerks and reduces the salary of the sales staff to a per hour pay system, resulting in displeasure, stress and unwarranted feelings of the staff as their livelihood was now at stake, four out of five employees continued with the firm.…
After a year of working for the company, each employee is given a share, and treated as a shareholder. Employees have a say in the overall direction of the company, and they work with the owners, rather than for them. This gives employees a vested interest in seeing the company progress further. The owners see all employee decisions and input as being very important to the success of the company. Chief Financial Officer, Jennifer V. Orgolini says, "How can you really care about the certain small things that are necessary to be done day in and day out if you don't have a larger purpose behind them?" Since employees are shareholders, the more profit the company makes, the more their share is worth. This creates an environment of employee-owners that all want to work towards making the company as successful as possible.…
The notion of "marketing myopia" has haunted marketers since Theodore Levitt published his famous article "Marketing Myopia" in Harvard Business Review in 1960. Levitt argues that companies which narrowly focus on the product to the detriment of customer requirements (i.e., dispensing with the marketing concept) suffer from marketing myopia. Myopia or shortsightedness is often apparent within organizations. Several types of marketing myopia can be identified including classic myopia, competitive myopia and efficiency myopia. Companies displaying one of these three elements are clearly distinguishable from innovative firms which embrace the marketing concept in practice and which have a much broader scope than is required for a single business sector. In order to overcome myopia and become innovative, the following is recommended:…
Firm E performed very well during the 8 periods we were in control. During those periods we grew the company’s contribution margin from $14.2 million dollars up to $70 million dollars and oversaw a stock price increase of over 170%. During this period we managed a maximum of 5 brands. Three of these five brands are making substantial profits totaling $75.7 million in the 8th period. The other two brands were targeted at the emerging Vodite market and although they are not currently seeing a profit, projections show they are on track to see profits within the next 2 periods (Exhibit #: chart showing Vodite sales)…
A sport marketing manager works for a sports marketing firm or for a sports organization directly. The primary role of the specialist is to think outside of the box in an effort to choose the right marketing tactics to promote specific sporting events and teams or even to promote products and services that are sold in retail stores or arenas. The sports organizations will use a good mix of both traditional and online marketing techniques to reach a target audience and increase merchandise and ticket sales. It will be the marketing manager job to research markets, determine the barriers and choose the appropriate channels for marketing that will keep costs down and generate revenue.…
“It is precisely this fiction-that the singular and primary purpose of the firm is to create value (in the form of a rising stock price) for its shareholders, who are problematically conceptualized as “the owners” - that has allowed corporate America to be shorn from? its job-creating potential and commitment to employment and other stakeholders and to be mined as a collection of financial assets for elite and private gain” (Ho 2). This argument by Ho brings up many points. Over the last few decades, companies have come under more pressure to deliver quarterly results that are pleasing to investors. In placating investors, however, employees can get hurt. When inflation rises or a company must cut costs, companies typically fire employees. CEOs are incentivized to appease Wall Street because they benefit from a rise in their company’s stocks, and their fiduciary duty pushes them to generate returns. They aren’t rewarded for retaining employees even if it is morally right, and management is far more concerned about the company’s performance than the economy’s performance. Also, poor people often do not own stocks. Even with the rallying of the market with Trump’s win in the polls, Trump’s base likely did not benefit much. Wealthy people are more likely to own stocks than poor people. Trump’s wealthy supporters enjoyed lower taxes and higher stock prices.…
This case study begins with Paul Kennedy on a slow morning commute in Cleveland. During his drive, he’s worried about his wife and family, his boss, his associate, a stranger in a nearby vehicle, and even about the state of the Cleveland Browns. He is also excited about his plans to expand Daner Associates into the European market and his impending promotion to CEO. But when Paul meets with his boss, Larry, that afternoon, he discovers that he has been misreading signals. Larry is actually considering Paul for the number two role in the company and considering promoting another Daner executive, George, into the CEO position.…