Asked by Colby Hastings on Jun 27, 2024
Verified
In profit centers
A) Managers are difficult to evaluate because there is no simple metric of how well they performed
B) Managers typically do not have the information to run their division efficiently
C) Managers' decisions can affect other divisions
D) Managers typically do not have the incentives to run their division efficiently
Profit Centers
Sections of a business that are responsible for generating their own revenue and profit.
Information
Data that has been processed or organized in a way that adds to the knowledge of the person receiving it.
Incentives
A factor, either monetary or non-monetary, that motivates individuals to perform an action.
- Acquire knowledge on how disparate incentive and appraisal processes affect the decision-making of divisional leaders and the outcomes of their divisions.
- Gain an understanding of how managerial decisions affect the company's performance as a whole and the dynamics among various divisions.
Verified Answer
ZK
Zybrea KnightJul 03, 2024
Final Answer :
C
Explanation :
In profit centers, managers have the authority to make decisions that can affect other divisions, so it is important for them to consider the impact of their decisions on the company as a whole. This can make evaluating their performance more complex than in other types of centers. Managers in profit centers also typically have incentives to run their division efficiently, as their unit's profitability directly affects their own compensation.
Learning Objectives
- Acquire knowledge on how disparate incentive and appraisal processes affect the decision-making of divisional leaders and the outcomes of their divisions.
- Gain an understanding of how managerial decisions affect the company's performance as a whole and the dynamics among various divisions.