Additional Case 2.1 Benson Manufacturing Is a Young, Small Firm That Makes Computer

question 128

Multiple Choice

Additional Case 2.1
Benson Manufacturing is a young, small firm that makes computer components and peripherals for assemblers like Dell and Gateway. Benson's market share is highly volatile based on the entrance and exit of competitors into the market. Benson buys raw materials from several suppliers who also supply competitors. The firm has two layers of management between the CEO and the component maker on the line.
The firm's CEO read a book about innovation and organizational change and now wants to look at what HR should do about reorganizing and changing staffing practices. The CEO wants to reduce costs in order to increase profit margins because he believes that margins will continue to shrink.
While productivity and quality are largely functions of the machines used in the process, the CEO still wants to focus on motivating Benson employees. He wants to motivate them by increasing wages through a bonus program, improving working conditions, and providing job security.
-Refer to Additional Case 2.1.What is the flaw in the CEO's suggestions for motivating the workforce?

• A) He's not involving the employees in the decisions.
• B) An MBO-based strategy would be more effective.
• C) It does not take the diversity of the workforce into consideration.
• D) None of the things he wants to do impact motivation, only satisfaction or dissatisfaction.

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Definitions:

Discount Rate

This rate is employed in the process of discounted cash flow analysis to ascertain the present worth of forthcoming cash flows.

Useful Life

The estimated period over which a fixed asset is expected to be usable by an organization.

Discount Rate

The interest rate used to discount future cash flows to their present value, often used in investment valuation and project evaluation.

Annual Net Cash Inflows

The total amount of cash received minus cash expenses over a year.