Case Analysis - Allied Electronics
Case Study Analysis:
Allied Electronics Corporation Ltd: Linking Compensation to Sustainability Metrics
Dr. Venter and Venter Junior
Robert Venter, second-generation Chief Executive (CE) of family-owned Allied Electronics Corporation Ltd, considered the pros and cons of more clearly linking the firm's compensation system to sustainability performance. In June 2011, Altron, a multinational headquartered in Johannesburg, South Africa, controlled more than 200 companies in Africa, Europe, the US, the UK, Australia, and the Far East. More than 14,000 employees designed, developed, manufactured, and marketed a range of telecommunications, electronics, power electronics, and information technology systems and products. Having made a clear commitment to sustainable development, Venter was confident that the commitment was shared across the senior management team. However, there appeared to be a higher acceptance in the operating units for meeting financial targets than for meeting sustainability targets.
There was a clear difference between Venter and his predecessor, Dr. Venter. Dr. Venter adopted a value-based culture in the company, ensuring that the mission and vision of the company were followed and reviewed after every year. The codes of ethics were maintained and that the company responded quickly to changing external forces and trends. Dr. Venter was mostly the sole decision maker at that time and whatever his decision was, was accepted by the organization. At the time Dr. Venter was in charge of the company, it was mostly bottom-line drive; focusing mostly on profits. No doubt that with the family oriented approach that Dr. Venter had and the sole responsibility that he had undertaken for all decision making made the company soar to new heights. But with the global changes in the corporate world took place and the way corporations did business shifted, a change was needed to handle this change. This was the perfect time that Robert Venter took over the
Allied Electronics Corporation Ltd: Linking Compensation to Sustainability Metrics
Dr. Venter and Venter Junior
Robert Venter, second-generation Chief Executive (CE) of family-owned Allied Electronics Corporation Ltd, considered the pros and cons of more clearly linking the firm's compensation system to sustainability performance. In June 2011, Altron, a multinational headquartered in Johannesburg, South Africa, controlled more than 200 companies in Africa, Europe, the US, the UK, Australia, and the Far East. More than 14,000 employees designed, developed, manufactured, and marketed a range of telecommunications, electronics, power electronics, and information technology systems and products. Having made a clear commitment to sustainable development, Venter was confident that the commitment was shared across the senior management team. However, there appeared to be a higher acceptance in the operating units for meeting financial targets than for meeting sustainability targets.
There was a clear difference between Venter and his predecessor, Dr. Venter. Dr. Venter adopted a value-based culture in the company, ensuring that the mission and vision of the company were followed and reviewed after every year. The codes of ethics were maintained and that the company responded quickly to changing external forces and trends. Dr. Venter was mostly the sole decision maker at that time and whatever his decision was, was accepted by the organization. At the time Dr. Venter was in charge of the company, it was mostly bottom-line drive; focusing mostly on profits. No doubt that with the family oriented approach that Dr. Venter had and the sole responsibility that he had undertaken for all decision making made the company soar to new heights. But with the global changes in the corporate world took place and the way corporations did business shifted, a change was needed to handle this change. This was the perfect time that Robert Venter took over the