Easter Seal Foundation of New Hampshire and Vermont Inc Case Solution

Management Control

Easter Seal Foundation of New Hampshire and Vermont are facing some management control issues. The most prominent issue that directly affects company’s financial performance is budgeting. The budget is poorly divided on a fixed basis without considering the size of the strategic business units. Secondly, executives of each subsidiary are often given “unachievable” or unrealistic goals to achieve. Lastly, most of the employees are overburdened with work. This decreases employees’ morale, which ultimately hinders performance and organizational growth.

2. As a consultant to Mister Gammon, how would you recommend he resolve these problems?

Mr. Gammon needs to revise the company’s vision and mission statement. In order to make a realistic and directional mission statement, he needs to take into account the purpose of the organization that was in Mr. Charlotte’s mind while starting this organization. Secondly, the mission statement also needs to be revised. A mission statement’s usual life span is deemed to be 10 to 20 years on average. However, Mr. Charlotte did not deem it important to predict and inculcate his upcoming plans into the mission statement. The new mission statement needs to include all stakeholders of the company, especially the company itself and its employees. The current situation of the company shows that it is taking the term “not-for-profit” in purely literal terms. The board of directors is “going with the flow”. They need to take a stance and show leadership in order to enhance the company’s performance.

Organizational restructuring might have solved some complex problems for employees and executives, but it has increased salaries expense to $982,587. Interestingly, this expense is the highest in the expense list. Currently, Mr. Gammon needs to make sure that the company makes a profit in the near future. On the other hand, one executive pointed out that due to decreased work burden, they have time to train their subordinate. It needs to be taken into account that the company has increased the level of management layers in it, which slows down the decision making process and inculcates a bureaucratic culture in the organization. For the short term, the company needs to revise the budgeting technique for the company because low funding has caused subsidiaries to perform poorly.