Vega Corp's Corporate Income Has Declined to Unacceptable Levels

question 124

Essay

Vega Corp's corporate income has declined to unacceptable levels. To change the direction of the company, the board of directors hired a new chief executive officer. She is currently considering three alternative ways to reward division managers for performance. They are:
1.Give each manager a competitive salary with no bonus for performance.
2.Give each manager a base salary with the largest portion being a bonus based on performance, ROI being the yardstick.
3.Give each manager a base salary with a bonus based on comparative performance with the other divisions.
Required:
Evaluate each of the ideas, giving strengths and weaknesses.

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Definitions:

Advantages And Disadvantages

A comparison or assessment of the positive and negative aspects of a particular choice, decision, or strategy.

Comparison

The act of evaluating two or more items to determine their similarities and differences.

Justification Report

A document that outlines the reasons for a proposed action or decision, often including analysis and evidence.

Project Proposal

A document that outlines the plan for a project, including its objectives, methods, and budget.