Atlanta Home

Good Essays
Atlanta Home Loan Case

1.)Types of controls Al Fiorni used: Action Controls: -By not letting Wilbur sign the checks he administered an administrative constraint on him. This allowed for Al to approve the outflow of cash from his company. -Al was smart to forward the corporate mail to California because it allowed him to have an idea of the overhead expenses the company was incurring. -Although Al was not monitoring the day to day operations of the company he monitored tracked the employee head count, number of leads, credit inquiries, loan applications funded expenses and bank activity. By monitoring these actions Al can hold employees accountable for desired actions or undesired actions.
2) What went wrong?
A lot went wrong. Even the controls that Al implemented above he left loopholes which weakened them significantly. Even though he would not let Wilbur sign the checks he left four unsigned checks with Letitia which in turn defeated the purpose of him not allowing Wilbur to sign the checks. In this case, he did use the right action control but he failed to implement it properly.

When Al monitored the day to day operations of the company from afar he was doing the right thing but he also did not implement it efficiently. Al should have communicated to all the employees how he was monitoring their actions. Not only to catch wrongdoings but also to reward the employees for exceptional work. This would have prevented undesirable actions if employees would know that they would be held accountable for their actions. This would have also spurred good behavior if they knew there was a reward for such behavior.

Al Fiorni did not properly set up personal and cultural controls. I believe his biggest mistake was not preparing his company for his departure in a timely manner. Because he was in such a rush to get to California he was not able to ensure the personal control of employee selection and placement. Al should have devoted a

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Atlanta Home Loan

    • 600 Words
    • 3 Pages

    Atlanta Home Loan Al Fiorini had a company called Atlanta Home Loan which offered loans in the Atlanta area. Al decided to return to school and was difficulty with people he hired to replace him in his absence. His first choice for replacement was a loan officer named Joe with 20 years of experience in the field. After he promoted Joe he was absent several days and missed important meetings with Al. After this Joe convinced Al to give him a second chance and this was met with absenteeism as…

    • 600 Words
    • 3 Pages
    Satisfactory Essays
  • Better Essays

    Atlanta Home Loan

    • 1909 Words
    • 8 Pages

    Atlanta Home Loan Case study Atlanta Home Loan A)Identify the devices (controls) that Al Fiorini used to control his business both before and after he went back to school. Classify each control as a results, control, or personnel/cultural type of control. Action control Before he went back to school i. Al monitored the activities of his loan offers by tracking the number of credit inquiries each requested. ii. Al closely monitored the loan application/lead ratio depending on the skill of the…

    • 1909 Words
    • 8 Pages
    Better Essays
  • Powerful Essays

    Atlanta Home Loan

    • 1755 Words
    • 9 Pages

    Marshall School of Business University of Southern California Atlanta Home Loan Teaching Note Purpose of Case This case was written as an example of an extreme control failure. It can be used in a class focused on management control, entrepreneurship, or management of small businesses. Al Fiorini, the manager of a small, but reasonably successful, mortgage lending company in Atlanta hired managers to run his business while he went back to school, for his executive MBA, in California. He did his…

    • 1755 Words
    • 9 Pages
    Powerful Essays
  • Good Essays

    Atlanta Home Loan

    • 657 Words
    • 3 Pages

    ATLANTA HOME LOAN I. Devices that Al used to control his business Before he went back to school a. Result control: - Al paid each telemarketer a combination of an hourly wage plus a performance bonus ($10.00) for each lead produced. - Al paid the loan officers 40% of the total loan revenue on loans that AHL originated and 60% on loans they originated. b. Action controls: - Al bought leads from list brokers, then telemarketers called people on the lists to assess their interest in refinancing…

    • 657 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Atlanta Home Loan

    • 591 Words
    • 1 Page

    Atlanta Home Loan Al Fiorini, the founder of Atlanta Home Limited – a mortgage lending and financing company was successful in its business in Atlanta maintaining less than 30% fallout ratio (the proportion of loans submitted to processing that were not funded) where industries standard fallout ratio was 30%. Al hired managers to run his business while he went back to school, for his executive MBA, in California and he hired them without any background check. He did his best to monitor the company’s…

    • 591 Words
    • 1 Page
    Good Essays
  • Satisfactory Essays

    Atlanta Home Case

    • 690 Words
    • 2 Pages

    Case1 Atlanta Home Loan 1. Identify the devices (controls) that Al Fiorini used to control his business, both before and after he went back to school. Classify each control as a results, action, or personnel/cultural type of control. Controls used Pre-MBA enrollment Al received all the leads generated by the telemarketers and then distributed them to each of the four loan officers- this is an action control more specifically an Behavioral constraint that limited their administrative access to the…

    • 690 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    Scenario 1: Lisa to leave for Atlanta without the family In the first scenario, I would have Lisa moving to Atlanta to get the new job. She would have to do this without her family. Since she has been offered the promotion, she can take on the new challenge and boost her career experience. The feeling of something missing can easily be translated to the absence of excitement and boredom. This could be possible as Lisa and Jim have grown in the same neighborhood since they were children and may need…

    • 1275 Words
    • 6 Pages
    Good Essays
  • Good Essays

    Question 5 Atlanta Home Loan – control failure Date: October 29, 2013 To: Mr. Al Fiorini Founder of Atlanta Home Loan (“AHL”) From: PT Consultant Subject: Strategies and the Importance of Setting-up Controls for Your Business Thank you for providing the background information of your company. Based on the information provided, there appears to be deficiencies in the control systems implemented within the operation. These control deficiencies were one of the main causes that allowed…

    • 964 Words
    • 4 Pages
    Good Essays
  • Satisfactory Essays

    Atlanta

    • 564 Words
    • 3 Pages

    Elements of Results Controls Albert (Al) Fiorini should continue running his business of Atlanta Home Loan (AHL)which is mortgage lending and financing company. He needs to fight to regaincontrol over AHL perhaps only about $25,000 worth of equipment left. In other toget back his business Al can apply elements of results controls which require foursteps. First, Al must define the dimensions. He must defining the right performancedimensions although is critical because the goals that are set…

    • 564 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    ase Atlanta Home Loan Case Atlanta Home loan A. Control and Effects Controls implemented by AI before he went back to school Result controls: * Telemarketers – their salaries consist of hourly wage and performance bonus based on leads produced. The performance salary has a motivational effect on amount of leads. * Loan officer – Company paid the loan officers 40% of total loan revenue on they originated and 60% on loans Loan officer originated. The explicit allocation encourages…

    • 343 Words
    • 2 Pages
    Satisfactory Essays