MCC (Missouri Computational Company) is a multinational group created in 1952 which successfully develops, manufactures and sells computers of medium and high capacity. It is building up business in North and South America, in Europe, in South-Eastern Asia, in Australia and in the Middle East. The American Headquarter, located in Saint Louis, Missouri, co-ordinates the production, the activity of research and development, the HRM policy and financial aspects. The factories are located in Saint Louis and Newark, New Jersey. The sales activities are structured in regional divisions. The major business sectors of MCC have regional sales under their responsibility.
This decentralised ...view middle of the document...
Coherence must be improved on the management level. A very attractive system of remuneration (related to individual merit) would come in addition to all that, and the systems of performance appraisal would be co-ordinated at a world level. Thus, in addition to more effective structures, the staff would have good reasons to achieve the pre-defined goals. "On a world scale, the organisation, he said, should be less hierarchical. For that, it would be wise to follow the approach which succeeded so well in the United States."
William Johnson, the vice-president in charge of human resources was anxious. He raised the question of the acceptance of such an approach in Europe or South America. A short answer to this question was that an additional time of six months would perhaps be necessary to envisage reaching the aims of the project in these areas. "We know very well that there are national differences", said the chairman who had spent 5 years in Germany. "It will be necessary to make them understand and to appreciate the advantages of shorter networks", added the marketing director who had worked for seven years in the unit of Singapore. The financial director explained that "the cultural differences grow blurred with the growing impact of the media. It is necessary for us to be leaders in the world and to create an environment which fits the image of Missouri ".
A certain number of principles which will be applied to all factories of MCC in the world was thus decided. A document entitled "How things are done at MCC" must be widely diffused so that each member of the group, wherever he is in the world, knows what it represents. The policies of human resources, marketing and sales will be co-ordinated at the central level. That will make it possible to fulfil the customer requirements better. The latter often internationalise themselves too. They must know that MCC can provide them with a high level and effective service everywhere. MCC will thus install uniform and explicit standards, in whatever country the company intervenes.
Almost two years ago, whereas the company was confronted with severe competition, MCC decided to adapt its remuneration system for the sale force and maintenance staff of the computers of medium capacity. The objective was to see up to what point it was possible to increase the motivation of American salespersons. The company had noticed that some of its best salesmen left it for competitors which offered better wages. A test was thus launched over two years with fifteen salesmen in the area of Saint Louis.
The new structure of remuneration was composed in the following way: The basic wage of the salesmen of computers of medium capacity was decreased by 10 %, and a bonus was created which varied according to the sales turnover of each salesman: 100 % of the wage for the best salesman, 60 % for the second, 30 % for the third and the fourth, and nothing for the eleven others.
During the first year of the...