Why would directors be more efficient than shareholders at improving managerial performance and changing their incentives? How would such a linkage tend to reduce the agency problems between managers and shareholders as a whole? Such a linkage can reduce the agency problem because it more closely ties the director’s individually efficient action with aggregate surplus; that is, the overall most efficient outcome, and optimal performance of the corporation. This means that the shareholder’s preferred outcome will more closely resemble that of the directors. Why would directors be more efficient than shareholders at improving managerial performance and changing their incentives?
SWOT ANALYSIS OF ATNT: (Slide is at the end of doc) STRENGTHS: * Geographically diverse business Geographically diverse business and revenue should help shield the business from shocks in any one part of their business. Different countries or locations around the world have different characteristics. Those characteristics do not always match; therefore, a company can lower their risk by investing in part of the world with low correlations. The lower the risk, the better. This lowers risk and increases the value of the business over the long-term.
A rising ROE suggests that a company is increasing its ability to generate profit without needing as much capital. It also indicates how well a company's management is deploying the shareholders' capital. In other words, the higher the ROE the better. Falling ROE is usually a problem. CAGR: Operating income, % Operating income (EBIT) measures a company's earning power from ongoing operations and it largely used by investor because it excludes the effects of different capital structures and tax rates used in different companies.
Political competence is what can really make the CC part of it shine and in turn CC will make political competence shine. Political competence is one of the skills necessary to apply good cooperate citizenship. Both are related to ethics. Whereas good corporate citizenship is about an organization acting ethically toward society as a whole, political competence is one of the necessary skill required to apply good cooperate citizenship, which is a number of related skills. Good CC, for example, a company CEO of a HCO defines good corporate citizenship as meeting the growth and demands placed on health companies by society in an economically, environmentally and socially responsible manner (“The Power to Change: Mobilizing board leadership to deliver sustainable value to markets and society”, 2001).
Seagate management have a fiduciary duty to protect the wealth of shareholders and ensure a fair offer tendering hence they have narrowed down to opt for this two-staged LBO transaction. Given that the expected cash flows of Seagate were stable and established, it makes leveraged buyout feasible. The borrower is well credit rated, cash flows are steady and the interest rate offered is financially reasonable hence the leveraged-buyout is suitable for Seagate. There are 3 potential sources of value creation in this transaction: 1. Use of a risk hedging financial contract, the swap 2.
However, it has various issues in terms of its strategy to more to a less bureaucratic, more customer focused organization. Ultimately, their goal is maximize return on assets through profitable growth. Thus, the change in strategy has caused La Caja to recognize into four different divisions – financial, commercial, technology, and planning & control. Caja Espana employees were reward on their performance through promotions and determined by their qualification and seniority, but had a small variable that was variable on their performance. It goes into detail how the performance compensation was laid out.
The benefit of a successful Kaizen costing program is that the company operates more efficiently and with lower costs. When they do that, they should reward those who have helped to achieve the success. As a company succeeds with its Kaizen program it becomes more “lean” and able to be more competitive in the marketplace, and more profitable to its shareholders. The potential downside of Kaizen is that management uses it as a stick, rather than as a carrot to motivate managers and employees to lower costs. Also, if employees are not properly trained on the Kaizen philosophy, they will likely not be motivated to seek lasting ways to lower costs and improve processes, or they may pursue cost reductions that compromise
I will say ahead of time that I believe Alpha’s term sheet is the better of the two, given that negotiation could be obtained though some clauses such as escrow shares, liquidation preference, compensation committee and board make-up. Although they seem to not have as high expectations for the company, they set forth provisions that protect themselves, but also seek to protect the founders. Moreover, The make-up of the investors in Alpha, dividend requirements, anti-dilution clause, information rights, voting system and type of security are more favorable. Differences and Similarities in Term Sheet Number of Investors Alpha’s term sheet displays the amount of investment from each investor in the pool. Alpha Ventures and Silicon Valley Partners are both investing $2.25 million.
Technology can create efficiencies in the business process that allows for lower cost and a competitive edge. Also applying on line ordering, research, order tracking, and banking services on line will allow our corporation to rise above companies with less technology. Technology such as email systems, hardware, internet, and telephone systems are all integral pieces in running any business successfully. Conclusion The entire McBride Financial Service marketing plan when implemented will host rewards of increased business to the corporation. Once the marketing plan is launched the market research will define the market best suited to target.
Moving forward, unions should use real life examples, such as the comparison of WMT and Costco, to show that unionization does not hinder a corporations profit potential and future growth opportunities. In fact, unionization can actually increase growth and profit. Through diversified training programs and increasing employee moral, two key benefits of unionization, companies can improve efficiency and thus prosper in long run. This can pay dividends to a company internally, indirectly reducing costs. For example, the unionized workplaces, such as Costco, experience significantly less employee turnover than unionized