The Atlas Corporation rents and sells furniture and appliances to individual consumers. The company’s primary market focuses on customers who rent-to-own; the customer pays a rental charge (which includes a 28 percent interest rate) for a specified time and at the end of that time, owns the furniture. Atlas has its own credit department for these contracts. Over the past two years, it has been difficult to collect customer payments in a timely manner. As a result, Atlas has experienced a sharp drop in profitability. The effect on profitability is such that Atlas now pays a higher interest rate (8 percent) to its bank to carry its own indebtedness. Atlas wants the accounts receivable (A/R) department to increase its collection of past-due bills. It has turned to you in the HR department to develop a system to incent and reward A/R clerks who increase the dollars in collections each month. Each A/R clerk is a non-exempt hourly employee. Applying what you know about what makes incentives and rewards effective, think through the process of designing an incentive and reward program for Atlas. Identify any issues that must be addressed. The information in the table below provides the previous year’s results (“Monthly Total” means the amount due but NOT collected in that month). C


Answer Questions
Order Now on