New Market Builders Supply is a six-store chain of retail stores selling home renovation materials and supplies mainly on credit; the company has its own credit card and does not accept other cards. New Market Builders Supply had a tendency to institute policies that conflicted with each other. Management rarely became aware of these conflicts until they became serious.
Recently, the owner, Angela Kim, who has been reading all the latest management texts, has instituted a new bonus plan. All managers are to be paid bonuses based on the success of their department. For example, the bonus for George Tatulis, the sales manager, is based on how much he can increase sales. The bonus for Sonia Petrov, the credit manager, is based on reducing the bad debt expense.
Required
Describe the conflict that the bonus plan has created for the sales manager and the credit manager. How might the conflict be resolved?