Report on Earth Inc.
To: Mr. G.O. Domino, President of Earth Inc. From: McHeath Associates, Business Analysts Date: 31st December, 1999 Subject: Final Report on the Financial position of Earth Inc. Dear Mr. Domino, We have completed our analysis and audit of your corporation, and our results are outlined below. Executive Summary
Our four year analysis was requested by you to prepare your corporation for the 21st century. In accordance with your wishes, we sent representatives to all of your 240 divisions, examining all aspects of their operations, distribution and resource allotment, and also, at a consolidated level, examined your policies and procedures regarding human resources, marketing, selling, general administrative functions and overall company morale. As you will see below, we have identified several areas within your corporation where drastic changes need to be made, in order for the corporation to keep operating effectively, and to maintain its status as a going concern. Product Basket Earth Inc. currently has not aggressively pursued any marketing strategy for its raw materials, and consequently has no exports at this time. Our understanding is that this is a deliberate move on your part, in order to allow Earth Inc. to operate as a tax loss organization, to offset your profits from other operations. Since we were not permitted access to these other operations, we will assume that this is your intention, and therefore, to a certain degree, your strategy has been successful. We do however, have concerns that Earth Inc. may not be able to continue to operate in any manner for much longer, due to the rapid deterioration of its premises, the low morale, poor internal distribution, and massive over staffing. I must also add that we feel that some of your senior officers were extremely unhelpful in supplying us with information regarding their expense accounts, which leads us to believe that they may be acting in a manner not in the best interests of the corporation. We have expectations that the up coming audit of your corporation by the URS may lead to the entire operation being shut down. There are specific issues which we will now address which we believe you should address immediately. Staffing and Morale There are two main issues here. Firstly, the corporation is massively over staffed. According to Universal Generally Accepted Practices, the maximum staffing level for a corporation of your size should be 600 million, where as you currently have 10 times this figure. This has to change, since it is causing some rather violent outbursts from some of your employees, and indeed, entire divisions seem to be in what I can only describe as a perpetual state of war. In most cases the reasons for this appear to be confusion over who the president of the company is, and I think you need to look at your Public Relations department for help here. We note that your last Senior VP of Public Relations was let go 2000 years ago, and has not been replaced since, and we believe this has led to many of the internal problems we are now seeing. In addition, many of the canteens in some of the divisions are poorly maintained and offer poor menu choices, which we believe is a product of poor distribution and, of course over staffing. Had you come to us with this problem a hundred years ago, we would have suggested at that time that you simply stop replacing retiring employees, since this would have eliminated the bulk of your problems. Your own approach we feel has been a little drastic, and the major staff cuts that you introduced at various times throughout the last century could have been handled with a little more tact. Some divisions feel that they have been left to fend for themselves, and to be honest, we saw nothing to indicate otherwise. It is our recommendation therefore that you take the following remedial steps immediately :