a. Did Altex need a new system? (What are the most critical problems facing Altex at the takeover? what does Ted see as the purpose of a control system? Did Altex meet their objectives?)
Yes, Altex really need a new system, because Altex is facing some critical problems at the takeover by Ted and Franck. The first most critical problem is the actual management system: the system in place was one accountant (Sarah Arthur) who kept everything in her head. The system was incomprehensible and complicated for the employees. Even the department managers knew nothing about their profitability of their operations. If they need anything, they should contact Ms. Sarah Arthur. It's a totally centralized system. So it took lots of time to obtain…show more content… So Ted thinks that it is important to educate the department managers to the new management approach wanted by him and Franck. Ted decided to make the control system represent reality and his personal role would then be that of an emotional leader as opposed to a task leader. Control system would be the task leader and Ted could avuncular personal leadership. He also thinks that decentralized decision making environment is very important. He thinks that without control system Altex would never survive.
At the end, Altex meet their objectives. First of all, by the end of the second month, Altex was producing a profit and loss statement on the activities of each department. Each department kept account of its own sales, receivables, inventories... So, decentralization implemented by Ted is working well. And the Administration Profit Centre established by Ted is also working. Thanks to this administration, all the charges were predetermined, calculated and announced twice a year, so the departmental managers would control their expenses by managing their receivable balances, conserving on equipment purchases, and varying the square footage they occupied. So there are never any unanticipated expenses. Globally the new system was well worked because today Altex is a big company (I visited their website). So the system installed by Ted and Franck is very efficient.
b. Evaluate the New System that Ted and Franck implemented. Should anything