Posted: September 10th, 2021

MBA402: Governance, Ethics, and Sustainability Assessment 2 Case Study – Trading.com

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MBA402: Governance, Ethics, and Sustainability
Assessment 2 Case Study – Trading.com
Background
Trading.com is a company that offers ordinary people share investment courses
and ongoing mentoring services. The philosophy at Trading.com is that anybody
can become a successful share investor if they have the right mind set, education,
and support.
The company was established three years ago by successful share trader Jospe
Drake. He has grown Trading.com into a medium sized business employing over
100 staff with offices in Sydney, Melbourne, Brisbane, and Adelaide. One year
ago the company’s course sales increased dramatically and now its operations
are expanding faster than the company’s capacity to hire and induct new staff.
Jospe considers this to be a great problem to have and continues to hold the staff
accountable for delivering strong financial performance.
But the company’s regional managers are not as thrilled as Jospe with the
organisation’s surge in growth. The rapidly increasing need for more consultants
has forced the company to lower their employment standards, hiring many new
people with little to no previous experience in sales.
Business Model
Trading.com generates leads by advertising free introductory webinars that
explain how share investment can be used as a vehicle for achieving an early
retirement. Webinar attendees are contacted after the introductory webinar by a
consultant who invites them to a free face-to-face consultation. At this meeting the
consultant attempts to sell the potential new client a share investment course
priced at $10,000.
The consultants are managed by regional managers in each city. The regional
managers report to a senior management team that includes Jospe as the
company CEO.
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Consultants
Consultants are given aggressive sales targets that are set by the senior
management team with little or no input from either the consultants themselves or
the regional managers. Until recently, the consultants were paid solely on a
commission basis, that is, they earned a percentage of the $10,000 course fee for
each client that they signed up. Jospe recognised this remuneration structure was
placing financial pressure on many consultants and so implemented a base salary
of $30,000 per annum.
Each month the consultants are ranked by the regional managers according to
their sales performance. The highest performing consultants receive special
bonuses such as expensive gifts and luxury holidays. Because the consultants are
pitted against each other like this, the company culture is highly competitive to the
point of ruthlessness.
Regional Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage rs
Regional managers act without a sense of the larger corporate strategy. There are
no well-defined information channels for sharing information either between
themselves or with senior management.
The regional managers have also surrounded themselves with “yes” men and
women, and do not hear much, if any, bad news. They tend to leave the
consultants alone because they do not understand the sometimes complex
language of the consultation process. Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage rs have limited access to
performance data and spend much of their time trying to resolve flare ups or
unanticipated emergencies. From the information they can access they tend to
focus solely on course sales figures and their monthly performance reports to
senior management are often late or not submitted at all.
Senior Get research paper samples and course-specific study resources under   homework for you course hero writing service – Manage ment Team
A high percentage of Trading.com’s business is based on new courses.
The courses are developed by Jospe and the senior management team: a
creative, risk taking group of share investors. In this regard they do not act like a
team but are given a great deal of autonomy and so develop course content
independently of each other, only returning to the group once they have created
something of substantial value.
There is an increasing frequency in the failure of new courses.

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Client Satisfaction
Client complaints are on the rise. Clients say they feel well respected and serviced
by their consultants until they sign up for a course. At this point their consultant
seems to lose interest in them and often fails to return their phone calls.
Risk Exposure Calculator
Be sure to include the Risk Exposure Calculator in your assessment answer.

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