...Arck Systems Case Study Introduction This paper will discuss how an optimal sales system should be implemented by Arck Systems through analyzing the changes incorporated by Bryan Mynor for the recently acquired Lux Software’s sales force’s compensation plan. We will begin with an overview of the major issues Arck Systems faced when assessing how the company should modify the plan. An examination of Arck Systems and Lux Software Inc.’s current compensation plans as well as the benefits and disadvantages of making changes to those compensation plans will then be introduced. Next, our recommendation for Arck Systems to create one unified compensation plan for both sales forces will be discussed, stressing the importance of a meticulous implementation of well-defined multiple customer value source plan into Arck Systems’ business strategy. Finally, we will conclude the paper by briefly reiterating the key details of the case, our analysis and recommendation. Background: Arck Systems and Lux Software Inc.’s Compensation Plans Arck Systems acquired Lux Software Inc., who enjoyed faster growth and higher margins, in an effort to grow market share through the expected synergies the two companies would experience once completely integrated. The acquisition resulted in Lux’s EVP of Sales, Chris Snyder, leaving the company. Snyder also recruited most of his sales management team with him leaving only Lux’s key salespeople. Bryan Mynor, EVP of Worldwide...
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...Arck Systems Case 1. A number of elements in the two companies’ compensation plans are different. Which of these differences should most concern Bryan Mynor? Explain The following elements in the compensation plans are different between Lux Software and Arck: * Base Pay (They both receive base pay, but it is almost double the amount the sales representatives receive at Arck than the representatives at Lux Software); * Quota (The representatives at Lux Software must reach sales worth $100.000 dollars per quarter, at Arck on the other hand they must reach sales worth $1.000.000 per year); * Sales commission (At Lux Software the representatives receive 4%, while at Arck they receive 9%); * Cap (A Cap is the sales level after which a salesperson will not make commission on further sales. This doesn’t exist at Lux Software and with Arck the limit is $6.000.000 in sales per year). * Other bonus (There are no other bonuses at Lux Software, while if you reach the cap at Arck the representatives get a $50.000 bonus). The most important difference for Bryan Mynor is probably the sales commission with a focus on the accelerators. Because of the accelerators the payroll is stretched out a lot. For instance, the difference in payroll between the 1st and 10th percentile is $2.8mn. 2. In a table compare the following characteristics of a Lux’s Sales Rep and an Arck’s Sales Rep: product sold Profit Margin, Sales Nature (which is more technical and which more relationship...
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...Swan’s Supplies is a wholesaler of sporting goods equipment for retailers in a local metropolitan area. The company buys sporting goods equipment direct from manufacturers and then resells them to individual retail stores in the regional area. The raw data in Figure illustrate some of the information required for the company’s purchase order system. As you can see, this information is characteristic of accounting purchase order systems but is not well organized. In fact, because of the repeating groups in the right-most columns, it cannot even be stored in a computer system. [pic] .:. Requirements Store this data in a spreadsheet to make it easy to manipulate. Then perform each of the following tasks in turn: 1. Reorganize the data in first normal form and print your spreadsheet. Why is your data in first normal form? 2. Reorganize the data from part 1 into second normal form and print your spreadsheet. Why is your data in second normal form? 3. Reorganize the data from part 2 into third normal form and print your spreadsheet. Why is your data in third normal form? SOLUTION: The raw data is as follows: | | | | |Purchase | | | | | | | |Customer | |Phone | |...
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