Questions Kooistra Autogroep Essay

2. Evaluate the budgeting, cognitive operation measuring stick, and inducement clays used at Kooistra Autogroep. What tilts would you recommend, if any?Budgeting systemThe CEO introduced a chunk annual budgeting process. The main object glass of this budgeting system was to determine the net pelf targets for the year. The net profit target is the companys revenue minus the controllable expenses. These targets were for the companys departments and should help with decentralization of the company. The budgeting process was ment to be bottom-up. This means that the managers of the departments could prepargon the budgets and the CEO and CFO then reviewed these budgets. Most managers be unexperienced with budgeting and the review of the CFO and CEO would lead to a discussion so that the managers would get more and more confident with budgeting.This would help the decentralization. The car application is an indus establish, which is really dependable on the economic conditions. S o the budget do at the beginning of the year is non always a workable budget. Reviewing the budget a few times a year could change this. The CEO helps out sometimes when the budget target probably is non termination to be made. only when the managers cannot depend on this. Performance measurementThe new cognitive operation measurement now includes not only financial teaching but in like manner nonfinancial information. The performance measurement system is used to communicate the companys objectives to the personnel. The objects that are measured in the performance are the most important objectives. The performance measurements provide the managers with the information to do their job properly and it provides feedback to the top management about the performance of the managers. The company uses Balanced Scorecard on a weekly basis. The equilibrise scorecard provides key metrics for the managers list of targets and it provides an character of the progress towards budget ta rget.Besides the balanced scorecard the managers get besides a monthly report, which is more detailed about the companys operations. Recommendation the balanced scorecard is used to measure the managers performance for different factors. These factors are financial and nonfinancial. But it is not really clear what the targets are. Everydealership has to have a return of gross gross sales of 2% but there is not given any supercharge financial of nonfinancial performance indicator. Incentive systemA major(ip) change for the Kooistra Autogroep was the expansion of the reconcile-for performance system. The pay-for performance system already existed in the company but only for a few sales bulk. But this is limited and not fully covered for all the sales people. Because of the already excising contract and rejecting the pay-for performance bonus system not every sales person is accounted with pay for performance. This could lead to disorder and unfair situation. Because when its no t going well with the economy and so with the dealerships sales the sales people with the pay for performance are accounted for the less sales. But the sales people with the universal salary contract are not accounted for the fewer sales.Also in normal situations the sales people with the pay-for performance system impart try to do their best because their salary depends on their performance. While for the sales people with the normal contracts its not as much depended on their performance. For the management aggroup the pay-for performance does its work for every member. So its fairer. The managers could also ask over a bonus reduction when some criteria were not met. But its said that this would be a very subjective decision and it was not really clear on what criteria it depends. This should be changed and made clear on what criteria or totally deleted. Note It is said that no bonus will be paid for below or above target performance, which is strange. Because as a company u w ould want to have above target performance.Further more the pay for performance system is a comparatively unknown system in Dutch companies and the personnel of the company are not really pleased with this system. So it would be point to cerebrate about for the company to introduce the system quietly. This could be done for compositors case by starting with a tradional bonus system and next to that also a pay for performance system. So using both systems for a few years and then switch to only a pay-for performance system.