Asked by Mariam Abdelmalek on Sep 24, 2024
Verified
All of the following can cause conflict between divisions EXCEPT
A) Divisional managers are rewarded on the profitability of the firm,instead of profitability of the division
B) managers of profit centers care too little about the effects of their decisions on other divisions
C) managers are rewarded only for how much profit their division generates
D) corporate executives cannot tell when one divisional manager's decisions are appropriate or not
Divisional Managers
Managers responsible for overseeing specific divisions within an organization, focusing on its performance and outcomes.
Profit Centers
Divisions or segments within a company that are directly responsible for generating its profits by making their own revenue and controlling their costs.
Corporate Executives
Senior management officials within a corporation, responsible for making major corporate decisions.
- Comprehend the rationale and solutions for discord among various units within a business enterprise.
- Distinguish between the objectives of maximizing division profits versus maximizing company-wide profits.
Verified Answer
AJ
Aidar Jantaev4 days ago
Final Answer :
A
Explanation :
Option A is the correct choice because if divisional managers are rewarded based on the profitability of the entire firm rather than just their own division, it encourages cooperation among divisions to improve the overall performance of the company, reducing the likelihood of conflict.
Learning Objectives
- Comprehend the rationale and solutions for discord among various units within a business enterprise.
- Distinguish between the objectives of maximizing division profits versus maximizing company-wide profits.