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ЗмістProperty rights and incentives
Pret a manger
We will be happy to come and discuss your requirements at a time convenient to you.
Tim Wilson, a business associate from the UK, will be visiting you at your office next week. You have not met before. He has just sent an email to let you know that he will be arriving at 10 p.m. on Sunday night. Write a polite, friendly email of 100 – 150 words to him.
Include the following points:
Company driver will meet Tim Wilson at airport (carrying a sign with his name) room booked at Aspen Villas Hotel – hotel normally used by your company informed hotel about late arrival hotel: small, comfortable, quiet (see website: www.aspenvillas.com) you will meet him 8.30 a.m. at hotel and walk to office (5 minutes) wish him pleasant trip
Increased volume vs. reduced costs
In the early years the fast food wars were fought with heavy discounting arms where high volume compensated low margins. However, later on, when the commodity costs got higher and the minimum wage increased in the slow-growth environment, there was a demand for higher profits. McDonald's surrendered the strategy of sacrificing profits for market share by cutting prices to drive sales and volume. The company started raising menu prices across half its system.2 Later on, in this highly competitive market, McDonald’s changed strategy, aiming
at binding customers to apply more monopolistic price policies. The very low prices was replaced by product initiatives and promotion to attract customers and increase margins, and now, the margin of McDonald’s belongs to the highest of the industry.3 Also, the competition is said to have changed the structure of profitability by eroding unit-level margins. Thereby it has become more difficult for restaurant managers to show growth in earnings and the impact of earnings growth from newly opened stores has decreased.
For the organization and distribution of tasks within the company, the high margin means that pushing volume is relatively more profitable for McDonald’s than cutting costs. Volumes are best affected by decisions taken high up in McDonald's organizational structure, for example by division teams launching marketing campaigns or setting up new stores. However, even if cutting costs has not such a great relative significance to the overall profit, the impact of cutting costs is far from negliable. This task is performed by unit manager as well as the maintenance of long-term relationships and image - areas which should be concentrated on by incentive policies.
1. The castle ......... built in the 15th century.
(a) was (b) is (c) has been (d) will be
2. If they had waited another month, they could probably ......... a better price for their house
(a) would get (b) had got (c) have got (d) could get
3. It's quite simple really. When it's cold, water ..........
(a) froze (b) has frozen (c) freezes (d) had frozen
4. She _____.
(a) has never be heard of (b) has never been heard of (c) has never been heared of (d) has never been hearing of
5. The candle _____ by the draught.
(a) was blowed out (b) was blow out (c) was blewed out (d) was blown out
6. The children ......... taken to school by bus every day.
(a) are (b) have (c) was (d) had
7. I can assure you that this box ......... never been opened before I opened this morning.
(a) was (b) will (c) is (d) had
8. Happiness is ......... than money.
(a) most important (b) more important (c) important
9. Kevin is bad, but Norah is ..........
(a) worst (b) worse (c) more bad
10. ......... President of the United States will be visiting Australia next week.
(a) A (b) An (c) The
11. Do you like playing ......... baseball?
(a) a (b) an (c) the (d) (none)
12. A story _____.
(a) will being made up (b) will been made up (c) will be making up (d) will be made up
13. I know ......... about it!
(a) anything (b) nothing (c) someone (d) any
14. There is ......... I need to do tomorrow afternoon.
(a) any (b) anything (c) yet (d) something
15. My friend doesn't know ......... about her birthday party!
(a) something (b) nothing (c) anything (d) anyone
You work in the engineering department of a manufacturing firm. Your firm needs to purchase a new motor for the pumping system at your plant and you have been asked to investigate three models that would all be suitable from a technical point of view.
Use the data below and write a memo of 200 to 250 words to the Purchasing Manager. Tell him which motor you would recommend and give your reasons.
Designing the incentive systems
To observe the performance of other agents is a difficult task. Hence, firms will create some kind of incentive system to promote and encourage performance. In addition to the constant motivation, incentive systems also serve to progression paths and compensation systems that retain and reward individuals who have developed managerial skills and knowledge critical to the company's business needs. However, the incentives on managerial level is often given through compensating the officers’ performance by payment.
Not only are incentives a way of motivation, it is also a way of directing work. There are many different tasks for each employment, and many tasks have several dimensions. The different tasks are discrete and mutually exclusive, that is if the officer performs one task this immediately implies that he cannot perform another. For example, if the officer chooses to make hamburgers he cannot also make french fries at the exact same period in time. The dimensions of the tasks are continous, they say by which preferences the officer has choosen to perform the task. Considering planning, for example, will the officer devote his time to stretgic planning or to plan day-to-day routines? Will the officer making hamburger try to make them as quickly or as good as possible? All tasks and dimensions are competing under the officer’s effort and time budget restriction, that is, with a limited budget, the officer will give some activities preference to others.
For the firm a differentiated pay system entails costs. These are other important factors for the decision of which comensation plan to implement. The company costs are of different types, ranging from the individual to the external context.
1. The amount of money you plan __________.
(a) will spend (b) spend (c) spent (d) to spend
2. She _____ by a bus.
(a) was been knocking down (b) was being knocked down (c) was knocked down (d) was knock down
3. She _____ with a fine.
(a) were let off (b) was let off (c) was letted off (d) were let off (e) was letting off
4. Ryan got into ......... at school again this week. I don't know what to do about his bad behavior lately. This is a non-count noun.
(a) dresses (b) cars (c) trouble (d) barns
5. Can you give me more ......... regarding the cell phone plan? I'm not sure if I want to buy a cell phone yet. This is a non-count noun.
(a) suites (b) stairs (c) watches (d) information
6. The little girl had two ......... in her hair. This is a count noun.
(a) braids (b) advice (c) slang (d) ice
7. I asked you ......... of these shoes you think would go with my outfit.
(a) whose (b) who (c) whom (d) which
8. ......... house is this, anyway? Are we allowed to stay here?
(a) Who's (b) Whom (c) Whose (d) Which
9. I have friends ......... love me so much that they threw a surprise birthday party for me last night.
(a) who (b) whom (c) which (d) whose
10. To get a job as a secretary, you must be good ......... typing and answering phones.
(a) for (b) at (c) with (d) about
11. Because of his new shift, he has to wake up ......... 3 a.m. every day.
(a) in (b) at (c) on (d) from
12. Such bad behavior is typical ......... the spoiled child.
(a) for (b) with (c) about (d) of
13. This book is ......... than the last one I read.
(a) thick (b) thicker (c) thickest
14. My homework assignment is very .......... It's too difficult.
(a) hard (b) harder (c) hardest
15. This is the ......... road I've ever seen!
(a) long (b) longer (c) longest
An English friend of yours has written to you to ask what you think about the following situation. He has been offered a job in a large city in your country and wants to know whether you think it would be better to live in the city or in the country within easy commuting distance of his job. Write a letter to him giving your opinion.
Firms can use a variety of instruments to motivate workers for his or her array of tasks. Milgrom and Holmström launch the hypotheses that paying the agent based on measured performance, giving the workers ownership of assets and freedom from direct controls of for exemple working hours, are complementary7 instruments which answers the eternal corporate question of whether to make-or-buy.
Traditionally, in an optimum, the importance of the three incentive schemes would be
balanced, as weak incentives for maintaining asset values would mean weak incentives for measured performance and significant restrictions on worker freedom. However, all these are endogenous variables while variations in the cost of measuring performance, in asset specificity, and in future uncertainty are exogenous parameters. An increase in the cost of measuring sales performance acts like an increased input price, leading to the substitution of salary for commissions and to a complementary increase in worker rules. Also, when monitoring is imperfect and costly will only a narrow set of activities to be rewarded effectively by the firm. In this case, asset ownership gives a more profond and powerful incentive instrument. When an agent owns a set of productive assets, she maintains those assets more effectively and the risk of moral hazard is less. By contracting and work design, tasks and work rules can be specified on forehand to restrict the freedom of the worker. More tasks can also be allowed if the agent owns the assets and when pay incentives are strong. Then responsibility and authority go hand in hand.
1. There was a lot of ......... at the Broadway show last week. People were very happy with the performance. This is a non-count noun.
(a) signs (b) drinks (c) seats (d) applause
2. I want to have some ......... this weekend. Let's go to the city! This is a non-count noun.
(a) bars (b) fun (c) dollars (d) rooms
3. I have one dog and two .......... This is a count noun.
(a) wine (b) health (c) peace (d) cats
4. You have to ......... your car in reverse before you can back into that parking stall.
(a) puts (b) put (c) putting (d) is putting
5. You have to ......... this problem. Otherwise, you can't move on with your life.
(a) overcome (b) overcomes (c) overcame (d) overcoming
6. I like ......... the lawn. I love the smell of fresh-cut grass.
(a) mow (b) mows (c) mowed (d) mowing
7. Naomi is keen ......... working in Africa this coming year.
(a) of (b) in (c) on (d) at
8. He's been suffering ......... migraine headaches again.
(a) on (b) from (c) of (d) about
9. All of Chris's teachers agree that he is very good ......... math.
(a) with (b) for (c) at (d) on
10. He is not energetic and alert right now. He is very tired and ..........
(a) exhausted (b) aware (c) watchful (d) ready
11. I can hardly hear the baby when she cries because she's so .......... I'm pretty lucky in that respect.
(a) quiet (b) quieter (c) quietest
12. "My Dad is the ......... man in the world," said five-year-old, Brady.
(a) great (b) greater (c) greatest
13. Thirty more people _____ last week.
(a) were lie off (b) were laying off (c) were layed off (d) were lied off
14. _____ to you yet?
(a) Have the books been given back (b) Have the book been give back (c) Have the book been gave back (d) Have the book being given back
15. Your jacket _____ over there.
(a) can be hang up (b) can be heng up (c) can be hung up (d) can be hunged up
Write an email to your boss, in which you are recommending ways in which your company (or any real or imaginary company) can improve its success.
The original plan
In the original plan of 1972 the manager's compensation package consisted of a fixed salary and a quarterly bonus. While the fixed part was determined by a range system which took labor rates and other economic factors into account the quarterly bonus depended on the manager's ability to meet predetermined objectives of labor costs, food and paper costs, QSC and volume projections. Therefore, the manager could receive a maximum bonus of 20% of his base salary.
On the one hand this plan eliminated a lot of shortcomings and complaints of previous plans and reached to combine managerial incentives with corporate goals. But on the other hand unit managers complaint about complicated evaluation schemes, subjectivity and emphasis of volume patterns. For this reason the following four new plans were created.
Plan A (Six factors)
Like the original plan also Plan A consisted of a base salary determined by the range system and a monthly bonus. This bonus depended on how the unit manager was rated by a regional operations staff according to QSC, training ability, volume and profit. Although this plan is a bit complicated, it seems to be the best proposal because it considers all things the unit manager himself can affect. Thus its strengths are not only the consideration of important corporate goals, a long term focus and the incentive rewards for profit and volume but also the acknowledgement of the importance of QSC to McDonald's success and the consideration of the manager's training ability. Weaknesses can be seen in its subjectivity and in a lack of balance. This means that four of the six factors require evaluation by a supervisor and that all factors are weighted equally. But certain modifications and good communications will make it understandable to participants.
1. I just bought my husband a new, leather ......... for his birthday. This is a count noun.
(a) frost (b) juice (c) luck (d) wallet
2. Some people say that ......... is the best medicine. This is a non-count noun.
(a) laughter (b) boots (c) eraser (d) bottles
3. My grandfather is full of .......... He is very knowledgeable and I like him a lot. This is a non-count noun.
(a) tests (b) tools (c) wisdom (d) eyes
4. I ......... understand him because I don't speak French. So, we used body language to communicate with each other.
(a) might (b) couldn't (c) mustn't (d) would have
5. You ......... worry all the time. Don't be so negative. You should be more optimistic.
(a) could have (b) might not (c) wouldn't (d) shouldn't
6. You ......... be able to catch a ride with Jim. You should ask him before he leaves.
(a) could (b) may (c) can (d) can't
7. I got a ticket the other night. The police officer stopped me for ..........
(a) to speed (b) speed (c) speeds (d) speeding
8. Most children do nothing but ......... video games all day long.
(a) playing (b) play (c) plays (d) to play
9. They decided ......... their son's birthday party until after Chris graduates.
(a) to postpone (b) postpone (c) postponed (d) postpones
10. If only I'd invested in that company, I'd ......... a millionaire by now.
(a) became (b) have become (c) had become (d) would become
11. Michael is a banker and he enjoys his work very much. However, if he __________ back to college next year he __________ a teacher so he could help children more.
(a) goes ... will become (b) went ... would become (c)had gone ... would have become
12. Harry is a serious criminal. If he _________ one more crime he _________ to jail.
(a) commits ... will be sent (b) committed ... would be sent (c) had committed ... would have been sent
13. Have you ever been to ......... Europe?
(a) a (b) an (c) the (d) (none)
14. I am ......... teacher. My husband is an accountant.
(a) a (b) an (c) the (d) (none)
15. I went to ......... Switzerland last month.
(a) a (b) an (c) the (d) (none)
Write a memo to all staff in your department (or any department of any real or imaginary company) telling them that they should copy what a successful businessman says or does
Plan B (draw against commission)
Plan B places the manager on a draw against commission in the second year after receiving a base salary suggested by the range system in the first year. In this case the draw is the salary of the first year and the commission is a bonus depending on profit and volume. This plan pleases a high growth environment and is excellent for managers who are risklovers because it offers unlimited payout potential. On the one hand its excessive dependence on the factors of profit and output gives little room for subjective intervention but on the other hand it excludes totally the impact of QSC. We have to ask ourselves if this can be in the interest of McDonald's corporation and if this package can adequately judge the manager's performance.
Plan C (supermanager)
This plan bases manager's total compensation solely on sales volume. Therefore it is called the "supermanager" program. The only strength OF this plan is its objectivity because it is based only on sales volume. Implicitly the plan ignores all the other important elements of McDonald's success. The fact that it does not mention cost control can even lead to decreasing profits to the company.
Plan D (lump sum)
In this case a predetermined lump sum, which is based on the size of the management team and the volume of the store, is distributed among the management team. The percentage to be received by each team member depends on how the supervisors evaluate the manager's individual performance.
This plan contains so many weaknesses that you can only wonder about how McDonald's management can come up with such a proposal. First of all this plan rewards volume at the expense of other managerial virtues. Second it is based on a totally subjective evaluation. Third it is internally absolutely not consistent because the total available compensation increases faster through the addition of another person to the management team than it does through an increase in sales.
1. The London Dungeon ____ in the oldest part of London - in an old subterranean prison (that's what the word Dungeon stands for).
(a) lie (b) is lying (c) lied (d) lies
2. The museum _____ its visitors on a journey through England's bloody history. It demonstrates the brutal killings and tortures of the past.
(a) take (b) takes (c) has taken (d) took
3. I didn't _______ to hurt your feelings. I was just trying to be honest.
(a) mean (b) means (c) meant (d) meaning
4. Suzanne, who lives ......... that coffee shop, came over to visit you this morning.
(a) on (b) by (c) at (d) in
5. I don't know how many times I have told my daughter to look both ways before running ......... the street.
(a) across (b) along (c) beside (d) around
6. My house is ......... the grocery store and the gas station.
(a) under (b) off (c) among (d) between
7. Do you ......... to work on Sundays?
(a) must (b) could (c) should (d) have
8. I ......... to pay for this traffic ticket on time.
(a) must (b) have (c) might (d) should
9. It ......... rain tomorrow. The weather forecast doesn't look good right now.
(a) have (b) need to (c) might (d) could have
10. He talked me into ......... his car. It is a sweet ride.
(a) to drive (b) drive (c) driving (d) drives
11. He continued ......... the direct questioning throughout the meeting.
(a) to avoid (b) avoided (c) avoids (d) avoid
12. She finished ......... the report at 5pm.
(a) wrote (b) writing (c) writes (d) write
(a) a (b) an (c) the (d) (none)
13. The old cinema _____.
(a) is being pulled down (b) being pulled down (c) is being pull down (d) is being pulling down
14. I want to see ......... Pacific Ocean in the summer. Let's go to San Francisco.
(a) a (b) an (c) the (d) (none)
15. He speaks ......... Spanish.
(a) a (b) an (c) the (d) (none)
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