The Decision-Making Process - Assignment Example

Management Name Institution Management Question 1 The level of managers increases with the size of a business organisation and workforce. The three levels of managers include low-level managers, middle-level managers and top-level managers. The top-level managers have the responsibility of controlling and supervising the overall operations of an organisation and they include CEOs, vice-presidents and board of directors (Robbins et al., 2006). The middle-level managers have the responsibility of executing plans which conform to the organisational policies and are intermediaries between top-level and low-level managers. They include general managers and department managers (Robbins et al., 2006). Low-level managers are responsible for directing and controlling and are role models for subordinates whom they supervise. Examples of these managers include supervisors and foremen. Question 2 The major functions of managers is categorised into four classes: planning, controlling, organising and leading (Samson, 2003). To start with, in planning, managers are supposed to create a comprehensive action plan that will assist in achieving the organisational goal. The activities that should be carried out with regard to planning include making decisions and evaluating success of a plan. In controlling, managers carry out evaluation of results against set goals and activities in this regard include establishing performance standard and taking corrective actions. Organising involves determining the way to distribute resource and organise employees and the activities with this ready include delegation of authority and assigning work (Samson, 2003). Leading involves managers connecting with the followers on an interpersonal level. The activities carried out in leading include motivating and communicating. Question 3 Managers need three essential skills including technical skills; managers require to attain techniques and knowledge of a job he or she is responsible; human skills which are very essential when working with people on an individual and group level while conceptual skills entails the skills required by managers to think, see and conceptualise about complex situations (Robbins et al., 2006). The importance of the personal skills varies from one level of management to another. However, the three personal skills generally are paramount elements needed in organisational performance (Samson, 2003. Examples of technical skills include management skills for engineers, human skills include controlling and decision making skills while conceptual skill include marketing skills. The business environment Question 4 The forces that affects business organisation include technological forces, socio-cultural forces, global forces and economic forces. With regard to socio-cultural forces, the compliance with together with awareness of the values and beliefs of society can assist businesses prepare for future and foreseen changes in the society is able to create either opportunities for or threats to a business organisation’s growth (Samson, 2003). Economic forces influence demand for commodities and services together with costs of producing the e.g. Inflation and tariffs. On the other hand technological forces cover areas such as innovation, technological forecasting and invention. Technological forecasting monitors industry trends. Question 5 With regard to socio-cultural force, organisations are able to prepare for future and the changes in terms of beliefs, lifestyle and values affects the organisational growth such as quality of education, environmental awareness, crime levels etc. (Samson, 2003). on the other hand, economic forces such as inflation, exchange rates and interest influence the demand for commodities and the production cost. Such forces, even though they are external to a business influence the current operation and long-term sustainability of an organisation (Samson, 2003). Ignoring them can be detrimental mistake and thereby managers should continually monitor and adapt to these forces in order to create competitive advantage and avoid failure. The Decision Making Process Question 6 There are seven decision making steps in any decision making process. In buying a computer for a company, a manger starts with defining the problem by considering critical factors such as money, technical know-how etc. tis is followed by analysing the problem by using available data then developing alternative solutions in order to have the best decision out of other alternative actions. It is then followed by selection of best alternative while considering risk elements, resources and economy of effort then goes the implementation of decision by communicating the decision effectively to subordinates. After this, the manager follow up on the decision by ensuring the achieving of set objectives and finally monitoring and feedback follow which provide the means by which the effectiveness of the implemented decision can be determined. General Business Question 1 The Australian company situated in Brisbane that I would like to be the manager is Virgin Blue Airways. Question 2 Virgin Blue Airlines is the second largest airline in Australia with regard to fleet size. It is based in Brisbane and was instituted by Richard Branson and Bret Godfrey. The company was founded in 2000 as a small airline with only two aircrafts and grow to be the Australia’s second largest airline. The airline currently serves 29 cities in Australia such as Brisbane, Melbourne and Sydney. The airline has its head office situated in Fortitude Valley which was opened in 2008. The company offer air transportation to people in 29 cities. It offers a business class service, premium economy seats, and economy seats. Additional services offered by Virgin Blue are airports and telephone services. Question 3 The fundamental target market of Virgin Blue Airline is the so called domestic leisure market since it is a cheaper carrier and already existing leisure market is price elastic compared to business customers. In addition to the leisure market, the airline also considers young families, students and also business people as their target market. Australia is considered one of the most popular study destinations for approximately 200,000 international students across the world. In addition, young families who enjoy spending their holidays with children enjoy services offered by Virgin Blue Airline. Moreover, Australia account for approximately 2.4% travel and tourism activity showing a sign of increase in the future. The company also targets businesspeople which is witnessed by the launch of Business Class aircrafts that allows the airline maintain its level of satisfaction. Question 4 The increasing interest rate by RBA has increased the largely the cost of borrowing and the incentives to invest and also the net returns to investment. Virgin Blue with high cost of finance, Virgin Blue will have fewer investment projects. The next way in which increasing interest rate affects Virgin Blue Airline is through asset prices. Changes in the interest rate by RBA affect the firms’ wealth which then affects their spending decisions. Increasing interest rate reduces asset values which in turn dampen spending. The third way in which increasing interest by RBA would affect Virgin Blue is through wages and prices. Interest rates affects inflation indirectly as it has an effect on demand and economic activity. The resulting demand for labour would strengthen the ability of Virgin Blue employees to bargain for better and higher wages. If these problems are not solved they may lead to failure of Virgin Blue Airways. Question 5 The major problem that will be the most serious is the increase cost of borrowing will affect the incentive to save and ultimately reduce return on investment. Using Dr Edwards de Bono’s method, some solutions for solving the mentioned problem include finding other ways to increase return on investment by increasing revenue, reducing the expenses, re-evaluating the established expectations in order to offer identifiable benefit. Another way to solve the serious problem of the increased cost of borrowing which reduces return on investment is to go virtual by learning complicated investing strategy such as covered call where the company is not worried about losing money. Also, another way to solve the issue is to borrow only the amount required and not in excess, to plan ahead as it is easier to negotiate lower rates when time is available and look for a multiple positive investments which give a positive return and is less affected by increased interest rates (Bartol et al., 2003). Utilising the power of compounding and avoid multiple negatives. Question 6 The four criteria that should be included when solving the mentioned problem in question 5 include analysis of the components of a solution, categorising by selecting and identifying rules to solving a problem, evaluation and judging with involves the comparison to a set standard and making judgement of worth and finally Plus-Minus-Interesting to consider positive, negative and thought provoking concepts of a solution (Glencoe, 2008). The weightage of the above mentioned criteria can be positioned in order of priority from analysis of the components of a solution, categorising solutions, evaluation and judgement and PMI. The weightage to each solution based on their importance can be arranged as follow: reducing expenses, increase revenue, avoid negative investments, multiple positive investments, and utilising power of compounding, borrowing enough, re-evaluating established expectations, go virtual, and planning ahead (Glencoe, 2008). Question 7 The best solution that can be implemented by Virgin Blue to solve the issue of reduction of return on investment which would be caused by increased interest rates is planning ahead. Planning ahead will allow the company have enough time to bargain for better investment rates, it will be able to assess the risks and opportunities, will have enough time needed to revise and update the plan and will improve performance with regard to investment. Question 8 I can motivate my employees to increase profits from $100,000 to $150,000 by using employees incentive compensation program that give them reason to stick with the company and work hard. I can also maintain a conducive environment in order for them to enjoy their work and find a reason to come to work every day. The third way is through involving them in decision making for them to feel appreciated and important (Glencoe, 2008). I can also pay attention more to their opinions, complains which will allow me create a personal relationship with them. Another way of motivating them is through giving them praise even for the smallest achievements. This will make them feel proud and will raise their moods. Other ways of motivating employees include avoiding criticising them, making everyone a leader, sharing the reward, giving small rewards once in a while and training the employees which will show that I care or them. Question 9 Tens ways in which managers can motivate the employees with the use of money include creating a happy and conducive environment to work in, set right tools and skills for them, praising them for any good work, listening to the employees, create personal relationship with followers, giving them the respect they reserve, start each day with some team huddle, promoting the employees, involve the employees in decision making and equipping the employees for their job. Question 10 Conducive environment will meet the safety needs, tools and skills and equipping the employees will meet physiological needs, praises, listening to them, personal relationship, and giving them respect will meet esteem needs, starting a day with a huddle, involving them in decision making will satisfy self-actualisation need and promoting them will satisfy self-transcendence need. References Bartol, K., Tein, M., Matthews, G., & Martin, D 2003, Management: A pacific rim focus, Enhanced Edn, McGraw-Hill Australia Pty Ltd., North Ryde, NSW. Glencoe/McGraw-Hill 2008, Introduction to Business, Student Edition[pdf] Available at: http://www.ebookee.com/Introduction-to-Business-Student-Edition_461505.html [Accessed on 6th December, 2010] Robbins, S., Bergman, R., Stagg, J. & Coulter, M 2006, Management, 4th Edn, Pearson Education Australia, French Forest, NSW. Samson, D., Daft, L. R 2003, Management: Pacific rim edition, Nelson Australia Pty Ltd, Southbank Victoria. Read More