BU527 Lecture Notes - Lecture 5: Southern California Edison
Document Summary
Problems identified: the increased population and economy resulted in a strong demand for electricity that could not be met by the supply that was offered in the market, thus there was a shortage. Implemented a retention incentive plan after the stock prices decreased and dividends were suspended, but the goals of the performance measures were unclear to employees. In 2001, they failed to meet performance expectations and paid out a minimum incentive awards to employees. In order to mitigate the unforeseen risks, the corporation should be well aware of trends that are developing in the california market. This would help avoid being unprepared for market trends, like for instance the increase in population should have been a trend that the corporation was aware and should have prepared themselves to meet the growing demand. It will be important for the organization to become more proactive with decisions, especially with the fact they should focus on contingent plans.
