The annual corporate battle

The end is near. The end of the year I mean, and to say that this year is an eventful one is certainly an understatement. As the year comes to an end, it also marks the beginning of an annual affair in the corporate world. No, I am not referring to the annual year-end reporting period… I am referring to a battle… a domestic one… one that is going to be even more intense this year…

I am referring to the battle for bonus allocation…

31 Dec is a very common year-end period for a lot of companies. But unknown to many, that while the accountants slave it out to report the numbers, there are those in the corporate world who will commence their battle to justify their “performance”.

In a big corporation, it is common to have more than 1 unit or department that generates revenue. For example, a big corporation like General Electrics have manufacturing business, aircraft servicing, capital, etc. Sometimes, a single company can have multiple revenue centre too. Take a bank for example, it has the corporate banking unit, consumer banking unit, debt capital market, treasury, etc.

Sometimes, when a business deal is struck, it can be difficult to ascertain which revenue centre is to be recognised for the credit. It may be easier if the company is a product-based company, though still possible. But it becomes messy when a company is service-based. Mind you, being recognised is crucial as it converts to increment and bonus at the end of the year…. $$$$$!

A very real example, which I think many are aware is this thing about how that little mp3 device called iPod… is dying a slow death. And do you know who or what is killing iPod? It’s none other than the… iPhone.

I heard (which means it could be untrue) that the iPod unit in Apple is blaming the iPhone unit of killing their own kind. It may not be the case in Malaysia but people around the world prefer to buy an iPhone instead of an iPod, which makes perfect sense really. And due to this, iPod is not doing as well as it used to be. Come payment of bonus, guess who in Apple will be pocketing a fat pay cheque?

Trust me, the “battle” to get oneself recognised for the credit can be a bloody affair. You have absolutely no idea how one is willing to go just to make sure one’s bonus is secured, even at the expense of others. And due to the current economic turmoil, the bonus pool is much smaller, which in turn will intensify the battle.

In the place where I work, I have already witness small battle happening since months ago. As the accountants need to separate the bonus provision between departments, this is going to be a bloody war.