Prepare a draft of a memorandum for Smith to pre-sent to her colleagues and management that includes, but isn’t limited to:
◆ What roles do performance-evaluation and reward systems play in organizations? Discuss individual vs.
team-based performance evaluation in this context. Are these roles relevant for all types of organizations and employees? To what extent, if any, do these roles apply to Fine Foods?
◆ Discuss basic concepts of performance evaluation, particularly results control. Discuss issues of financial vs. non financial performance in this context.
◆ What types of responsibility centers are the SMUs in Fine Foods? Are these appropriate types of responsibility centers for Fine Foods? Why or why not?
◆ Identify potential agency costs that might occur within Fine Foods. Discuss performance measurement
and incentive systems as mechanisms to decrease agency costs at Fine Foods. Identify and discuss any recommendations to implement a reward system.
