3. Describe how the Conrads could use market controls to plan and implement their expansion — Discuss Rudy Diane can feed forward concurrent feedback both now future Grizzly

1. Discuss how Rudy and Diane can use feed forward, concurrent, and feedback controls both now and in the future at the Grizzly Bear Lodge to ensure their guests’ satisfaction.

2. What might be some of the fundamental budgetary considerations the Conrads would have as they plan the expansion of their lodge?

3. Describe how the Conrads could use market controls to plan and implement their expansion.

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1. Rudy and Diane will want to use feed forward controls to anticipate problems before they arise. For example, they will need to create a budget and stick to it in purchasing the new lodge and staffing it. In addition, they may want some of their current employees to help them create procedures that can be shared with new employees. Empowerment will continue to be important, but training is equally important.

Rudy and Diane are already using concurrent control systems by supervising the work of their employees, and allowing the employees to do whatever it takes to satisfy a guest. As the lodge expands, they may need to do a little feed forward control to think about concurrent control (e.g. - they may need an additional manager as the lodge expands.) Obviously financial controls are critical concurrent control systems - Rudy and Diane will need to keep a watchful eye on expenses, rates, and profit as they move forward.

Finally, the most important feedback control for Rudy and Diane will be customer satisfaction, which can be measured either through surveys or, more importantly, through return visits.

2. Rudy and Diane will want to estimate their sales and expenses in any budget they create. In addition, they may want to budget their labor, both in terms of costs and hours. Costs might be split into fixed (e.g. mortgage) and variable (e.g. electricity, labor.) Rudy and Diane may also find it useful to do activity-based costing, so that they can estimate their costs across different parts of the business (restaurant, hotel rooms, activities, etc.)

3. Market controls can be used at the level of the organization, the individual business unit or department level, or at the individual level. At the corporate level, business units are evaluated against one another based on profitability. Within business units, transfer pricing may be used to approximate market mechanisms to control transactions among departments. At the individual level, market mechanisms control the wage rate of employees and can be used to evaluate the performance of individual managers.