Performance Evaluations
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Performance Evaluations
The Promotion and Advertising Department at Jefferson Corporation coordinates point of purchase promotion for the distributions. Employee of this department are graphic arts or marketing majors who develop campaign materials and conduct market research. The does not collect any revenue for these services. The Department manager is evaluated based on the department ability to operate within it budget. For the last several years the manager has had to curtail many promotion programs a month before year-end in order to stay within budget.
Sales personnel,marketing representatives ,and customers frequently complain when these serves are terminated. Dan Beck, the department manager, told a colleague.â?I hate taking all the hear every year .But I just canâ??t afford to blow the budget.â? He also noted the â??sooner the new budget will be out ,and I can give everyone what they want!â?
Required
A. What type of responsibility centers is the Promotion and Advertising Department/
B. How is the department currently being evaluated? What are the the important elements on which the department should be evaluated?
C. What appears to be the reason for the departmentâ??s budget problems? what implication does this have for the company?
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The solution explains some questions relating to performance evaluations
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A. The Promotion and Advertising Department is a cost center. It does not generate any revenues and is evaluated based on its ability to operate within the budget. Thus it has responsibility only for its costs and so is a cost center.
B. Currently the department is being evaluated on its ability to operate within the budgeted costs.
The important elements on which the department should be ...
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