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Rational decision making theory
Rational decision making theory
Rational decision making theory
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Stan Eagle made managerial decisions to move his business and career forward. His approach to making managerial decisions involved uncertainty and risk, conflict, lack of structure affected his decision making and his business as a whole. Following his partnership, Eagle was pushed to make decisions which he was not confident in. For example, he was urged by his friend to begin a clothing line and may have not considered the consequences of expanding to an unknown market. In addition, when Pete wanted to move towards inline roller skates and ice skates, Eagle was troubled as this was an unknown market once again and he had paid the price in his last business venture. The insufficient information lead down a costly path for Eagle the first time, …show more content…
Nonprogrammed decisions are always much more difficult to make than programmed ones. Having previously failed in the clothes industry adds to the complexity of the decision. Stan must decide how similar this expansion is to his previous one in order to make sure he is not drawing incorrect conclusions from it. Furthermore, conflict arises due to the fact that Stan Eagle is not willing to expand his business by selling equipment for a greater variety of sports. He only wants to sell the products he is familiar with and he believes that the company should focus all of their efforts into something they are extremely knowledgeable about. While Williams believes that selling equipment for more kinds of sports would produce more for the …show more content…
The first step is to identify and diagnose the problem. Stan not knowing if he should expand into inline skating and ice skating is the problem in this case. The next step is to generate alternative solutions. Two possible solutions are either to follow Williams’s advice and venture into inline skating and ice skating, or to buy out Williams’s ownership share in the company and run the company on his own. The next step is to evaluate these two possible solutions. Venturing into inline and ice skating equipment is the riskiest of the decisions, but it could also have the most reward. Despite the allure of a high reward, Eagle’s name means nothing when it comes to inline and ice skates. They would lose a driving force of sales if they left skateboards. Looking at the company’s history also makes this decision unappealing. They already had one unsuccessful expansion, and although the industries are different, it should be taken as a serious warning to future expansions. Buying out Williams’s stake would give Stan the freedom to run the company how he wants to run it, and to avoid this risky venture and ones that Williams will suggest in the future. Stan could then focus on what the company is most successful at: skateboards. The downside to this is the cost of buying him out, but considering Stan is
Delta’s purchase of the Trainer Refinery and the merger with Virgin Airlines are clear examples of grand strategies. Delta sought these strategies to achieve long-term business objectives. Delta recognized hurdles in achieving profit posed by increased costs associated with jet fuel (and their incredible dependence on fuel as an operating cost) and a lack of access to the international market for trans-Atlantic flights. In order to achieve these objectives Delta employed two different strategies. The first was vertical acquisition. By purchasing a refinery, Delta was acquiring a supplier and the inputs that it needed for operations. More specifically, this is an example of backward vertical integration because Trainer “operates at an
One weakness is that the CEO does not have his bachelor’s degree. The company also lacks capital to expand into other parts of the United States as well as international. Ascension Worldwide also lacks strategic partnership necessary to move into the international space at this point. The CEO and his associates need advance certifications in organizational development in order to be effective coaches and trainers. This company also needs a good mentor in order to take it to the next level. They should hire a coach and a marketing company so that they can grow to their fullest potential. “Strengths and weaknesses are the "internal" aspects of the traditional SWOT analysis.” (Abraham, S. C., 2012, p.
Evaluating Cooper’s Ice Center’s situation, Claude Cooper is looking to increase his profits. He is doing a few things right. For instance, his hockey program is doing well and is contributing largely to his profits. Along with keeping his hockey program, Cooper should also keep the public skating. While this is not bringing in revenue now, there is a great potential in the program. Over 700 hundred people could attend this event and it would increase revenue in concessions. Their facility is the only ice rink located in the northern city with 450,000 people. This means there is a great market for public skating. Once he figures out how to promote it, he can easily fill his 700 people rink capacity. Cooper also has the right concept for
Actually, we don’t think this mixed and unclear strategy worked best for Eckerd, a strategy that has an obvious focus would fit better. Mixed strategy is acceptable, but without a focus, it would hardly built an “everything fits” system and its way of success would become easy for competitors to copy. Moreover, we should never forget the stress from leverage buyout. Without tremendous resource, Eckerd would not have enough money to pay for the activities for all three strategies. To sum, resource is limited, and that’s why a more focused strategy is needed.
Over the last 11 years, the company has begun to tighten their belt. Teams were periodically cleaned up, and lack of organizational control and formal structure would permit them to again expand their teams with complete disregard. Spending budgets were eventually cut, but mostly at the corporate level as Sales kick-offs became virtual and were no longer the synonymous ‘what happens in Vegas stays in Vegas’ week long parties. Business practices previously based on the degradation of the competition were no longer suppo...
...ntrol setup which would allow his employee’s to exert more self-control giving the confidence and awareness to do these tournaments themselves which will thus free up David to do other things to improve the overall aspect of business like set up more tournaments, hiring more people which would increase the profitability of his company.
Stan must consider the consequences involved in running a sole proprietorship that exposes him to unlimited personal liability both financially
In the end, the owners must agree and commit to a plan. If the owners stand firm with their decision and remain flexible and dedicated to the plan, success is imminent.
Richard Jun is a Partner at BAM Ventures, a leading firm who has invested in the Honest Company along with many other successful startups. However, like many people in Venture Capital, he didn’t know he wanted to do that job until after his first entry level position. Like the Managing Partner of JUMP Investors, he started as a lawyer. He graduated from Columbia Law School and went into Corporate Law for a Korean Entertainment Company. However, he was quickly bored of his legal job, and left his position to become the General Counsel of ShoeDazzle, a startup created by Brian Lee and Kim Kardashian. From there, he took many other roles in the company. Coming from a legal standpoint, he found it much harder to work as the other positions, such as the CMO. As the company continued to grow, he started to realize what problems a growing company has. Some problems hit such as the company not growing as fast and having to lay off people. Richard didn’t have previous experience in operations and executive
As CEO of the Andrews Company, my responsibilities were to operate my company in all fields including Marketing, R&D, financing and Production. As CEO, I followed certain steps to the of best my knowledge in order to ensure the success of each department and company as a whole. In the process of utilizing every skill possible, products were introduced to meet the demand of my Niche Cost Leader Strategy. My requirement for utilizing the Niche Cost Leader Strategy was for my company to focus on the traditional and low-end segments by automating in mass production in order to keep costs down for my company. My company’s agenda was not to compete with the latest technology advancements but to focus more on cost savings that will in terms provide
Miller, D., & Le Breton-Miller, I. (2005). Managing for the long run. Lessons in Competitive
Starbucks’ CEO had a good understanding of the need for good business strategizing, which explains the high success rate that the company has experienced over the years. His strategies were precise; globalization of the company, focus on the beverage market targeting affluent and social professionals, developing a strong brand, investing in an efficient and customer friendly workforce, striving to break new business grounds ...
Kamen, while a definite asset to Segway, could be a detour or even a dead end on the company's road to success. Historically, Kamen's successes have been based on his abilities to be innovative in research and design, while at the same time being able to pass the developed product off to a partnering company that is able to take the product to market. Kamen's emotional attachment to Segway is preventing its success. As if these problems were not enough, combined with the fact that there was no pent up demand for such a product, Segway's future success will be dependent. on an organizational makeover.
Organisational change can arise due to a change in strategy and this begins with examining capabilities and the internal environment. This is portrayed in the Strategy diamond. Firstly through arenas the organisation can plan where they will be active in and which part to place most emphasis on for example technologies or value creation strategies. Only after determining this can they implement a positive change, leading to the next element, vehicles to get them where they need to be such as alliances. This can lead to change in management along with strategic partnerships, and the way managers transition to this change will determine if the strategy impacts on the overall organisation in a way that reinforces its purpose and goals. Partnerships indicate how an organisation can strengthen its capabilities by merging with businesses who possess the skills they lack. (Carpenter et al. 2010)
Phil Knight’s multifaceted approach to leadership has had not only a profound impact on his employees, but the athletic industry, and the world as a whole. Nike continues to be the top earning athletic wear brand in the world, employing tens of thousands of new employees every year throughout the globe. Operations transcend national borders, and traditional business approaches. By identifying and capitalizing on a market niche, having a strong vision, and the work ethic to achieve his goals, he has found unparalleled success.