Armco Essay

716 Words3 Pages
Armco. Inc Case Analysis Objective of the company: Although not explicitly stated, it can be inferred from the case that the main objective of the company was likely to maximize profit for their shareholders. Strategy: The Kansas City Works is not a low-cost manufacturer and therefore focuses on product differentiation. They continuously attempted to develop new higher-value products. The quality of their products is important to them and their consumers. Desired behaviours: The Director of Finance wanted management to focus on the important matters, be able to spot problems quicker, and improve their commitment to achieve objectives. In general, the company wants workers to improve productivity and efficiency to increase profits. Management Controls: There were cash incentives in place that were based on the subjective performance evaluations performed by an employee’s immediate superior. There was also a performance measurement system in place. Management believed that the old performance measurement system was not doing an adequate job. Too much information was being given to managers, which made it difficult for them to focus on the important issues and fix problems quickly. They also believed the performance measures were not adequate in evaluating the work done by employees. Due to these issues, management is implementing a new performance measurement system, which is supposed to provide 2 major improvements: 1. Help managers focus on few key objectives 2. Provide a better basis for evaluating operating managers and manufacturing supervisors There is also a list of 10 key performance measures to help employees know what to focus on. The new system aims to help lower and middle level employees understand how their actions contribute to the implementation of the business’ strategy and whether company goals are being achieved. The

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