Subsequently, given the outlook of the budget, measurement, and incentives performance that already analyzed above, there

are some changes that we considered are necessary to be applied in Vershire Company: Gaining communication quality among the corporate managers and the division managers General meeting among the corporate headquarters and division manager must be held to discuss the upcoming budget per annum Communication channels between division managers are necessary to be organized In developing division forecast, corporate managers should be assisted by division marketing manager, in order to avoid general assumption that usually made by the corporate headquarters The benefit Vershire may get by gaining the communication quality among the corporate managers and division managers are: Facilitating the managers to do the brainstorming to discuss issues happened in their divisions, and as the resource sharing among the corporate managers and division managers Preventing the division managers goal incongruence Minimizing error in sales budgeting process Changing the compensating rules and responsibility over profit Restructured the compensation rules in order to gain more profit, by relating the compensation with the cost Adjusting the sales managers compensation to the profit Extra costs associated with sales managers or high level management decision have to be counted Cost for natural disaster or acts of nature have to be added The benefit may be taken from actions mentioned above are: Profit maximization because the plant managers will be motivated to control the cost to gain more in compensation Giving protection to the plant managers against some uncontrolled factors Establishing more cooperative action between the plant managers and sales managers, because they have the same goals in maximizing the profit Achieving better goal congruence Enhancing the comparison of manufacturing efficiency between divisions and the plants Comparing the manufacture efficiency using appropriate measurement system or delivering a new comparable system to measure it Giving reward to the most efficient plant

From those following actions, some benefits Vershire may achieve are: Increasing efficiency might be impact in maximizing the profit Gaining more knowledge to set up strategy and actions by comparing the efficiency among the divisions and plants Keeping the goal congruence