Head product a mfg division head functional form mkt

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Unformatted text preview: — Strat and Org c 2008 Scott Schaefer Mfg. Head Product A Mfg. Division Head • Functional Form Mkt. Head Product A Mfg. Head Product B CEO CEO Mfg. Head Product B Mkt. Head Product A Division Head Product B Mkt. Division Head Mkt. Head Product B Mkt. Head Product B 6 8 – Properties: ∗ Useful when employees in the division control costs, but have little effect on revenues. ∗ Basing rewards on cost-based measures tailors the performance measure to things the employees can control. This shields employees from revenue-based risk, and allows the firm to offer higher powered incentives. – Examples? • Cost/Expense Centers Common Divisional Performance Measures M&S 452 — Strat and Org c 2008 Scott Schaefer • As we will see, because structure affects what performance measures can be used, structure also affects the set of decisions that can be delegated. • Structure affects what types of performance measurement and reward systems can be put in place. • Activities should be organized to take adva...
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