Harwood Medical Instruments PLC
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Question 1
The new plan is based on an approach of a Balanced Scorecard, which was developed by Robert Kaplan and David Norton. The procedure acts aa a means of pushing companies away from depending solely on the financial data. The main aim is to focus on financial information and building capacities and non-physical assets required for lifelong growth. The implementation process takes place by converting a company’s strategy into distinct actions within an individual category. Many companies use the BSC management tool to achieve different intentions, such as: shed light on and communicate strategy, line up specific and unit goals to plan, establish a relationship between policy and the budgeting process, and acquire a response from day to day strategy development.
The employees of the company and who are entitled to the new bonuses are likely to feel adequately compensated. As a result, their loyalty in the company will highly increase. An increase in loyalty among the employees will also make them think typically satisfied and less inclined to look for new job opportunities, thus saving time and reducing original recruitment costs. Either the new plan will improve the quality of service offered by the employees to the customers, thus increasing their satisfaction (Pohle & Schmidt, 2016).
Question 2
Bonus earned by each manager for every six months and the year 2010
| Surgical instrument division (FTYE 2010) | Ultrasound diagnostic equipment division (FTYE 2010) | |||
| Particulars | For the 2nd half | For the 1st half | For the 2nd half | For the 1st half |
| $3420 | $4060 | $4620 | $4400 | |
| Operating profits | $34.20 | $40.6 | $46.20 | $44.00 |
| On-time deliveries | 97.3% | 98.2% | 95.4% | 94.6% |
| Adjusted | $2000 | $2000 | ||
| Sales returns | $291 | $289 | $450 | $420 |
| % of sales | 1.02 | 1.00 | 1.07 | 0.95 |
| Adjusted | ($2.50) | $5000 | ($15) | $5000 |
| Patent acquisition | 4 | 8 | 0 | 1 |
| Adjusted | $4000 | $8000 | – | $1000 |
| Scrap & rework cost | $45.00 | 39.70 | $51.10 | $28.20 |
| 1% of operating profit | $34.20 | $40.60 | $46.20 | $44.00 |
| Adjusted | ($10.80) | – | ($4.90) | – |
| Customers satisfaction | 89% | 81% | 78% | 91% |
| Adjusted | ($5000) | ($5000) | ($5000) | – |
| Half-yearly total | $1020.90 | $10040.60 | ($4973.70) | $6044 |
| Total (yearly) | $11061.50 | $6044 | ||
Question 3
The strategy adopted by the Harwood Medical Instruments PLC as an organization has the following aspects which are vital in increasing its sales in the market;
First, all of the actions adopted in the company plan whether the financial of non-financial was derived from the company’s vision and strategy. The management used the company’s vision as a practical guide in creating the new policy; this was important as it increases unity among the company employees as well as increasing group focus (McDonald & Wilson, 2016).
The process used in developing a new plan was participative rather than directive. The use of participative leadership in coming up with the idea empowers the responsible employees to use creativity to grow the sales of the company. There is an increase in Sales operating results of the company’s surgical instruments and ultrasound equipment between the first and second half of the year 2010.
To make the plan more active, the company must embrace new cultural values and priorities in their new program. Values are a critical component of a healthy work environment because they shed light on how the company and its employees should behave. It offers a substructure through which management can test decisions, fulfil tasks, and interact with each other (McDonald & Wilson, 2016).
References
Pohler, D., & Schmidt, J. A. (2016). Does pay‐for‐performance strain the employment relationship? The effect of manager bonus eligibility on nonmanagement employee turnover. Personnel Psychology, 69(2), 395-429.
McDonald, M., & Wilson, H. (2016). Marketing Plans: How to prepare them how to profit from them. John Wiley & Sons.