Managing Change Internal Causes of Change by liaoqinmei

VIEWS: 6 PAGES: 22

									 Managing Change

 Making Strategic Decisions

“Good decisions come from wisdom. Wisdom comes from experience. Experience comes
                                                              from bad decisions.”
                                                                      Anonymous

  “Decisions of the kind the executive has to make are not made well by acclamation. They
    are made well only if based on the clash of conflicting views…The first rule in decision
                making is that one does not make a decision unless there is disagreement.”
                                                                             Peter Drucker

“A complex decision is like a great river, drawing from its many tributaries the innumerable
                                                         premises of which it is constituted.”
                                                                              Herbert Simon


                                                        BUSS4.11 Decision Making
In this topic you will learn about:
 The significance of information
  management
 The value of different approaches to
  decision-making
 Assessing influences on corporate
  decision-making

       If only you knew!



                           BUSS4.11 Decision Making
 Making Strategic Decisions
 • Made at the top of the                          • Long term direction of
        hierarchy                                           business
• May require high capital                              • Aim at meeting
       investment                                    corporate objectives
 • Once made difficult to                              • Will impact upon
         reverse
                              Strategic              different stakeholders




                               Tactical



                             Operational

                                           BUSS4.11 Decision Making
Significance of Information
Management
   Information Management
    ◦ Use of accurate and up to date information to
      aid decision-making
    ◦ Collation and sharing of information
   Management Information System
    ◦ The use of IT to collect, store, process and
      disseminate information
                                                         Information
    Data          Processing to give                  Date with context
Raw facts and    meaning and context                 that can be used to
   figures
                                                     aid decision making
                                       BUSS4.11 Decision Making
Information Management




                 BUSS4.11 Decision Making
Information Management
 Effective decision-making will require both
  qualitative and quantitative information
 Information can come from both internal
  and external sources including:
    ◦   Financial Accounts
    ◦   Market Research
    ◦   Competitor Analysis
    ◦   Market Analysis
    ◦   SWOT Analysis
    ◦   PEST Analysis
    ◦   Economic Forecasts


                              BUSS4.11 Decision Making
 Approaches to Decision-making
     Scientific                    Intuition
     Backed by research            Based on gut instinct
     Outcomes are                  Quicker decisions
      simulated or tested            can be made
     Reduces but does              An experienced
      not eliminate risk             manager may
     Decisions are                  understand the
      objective                      market
 If you were to put £1000 on a
                                    Decisions are
horse would you study the form       subjective
   or go for one you liked the
            sound of?            “Nothing slows down an organisation
                                   more than paralysis by analysis.”

                                      BUSS4.11 Decision Making
Decision-making – Further Reading
     There are many techniques to aid decision-
      making
      ◦ SWOT
      ◦ Cost Benefit Analysis
   Six Thinking Hats – look at
   decisions from different angles
   Pareto Analysis – what is
    the most important problem
    to solve?
   Starbursting - analysing
  decisions by asking questions

 How useful would each of these approaches
  be to a chain of coffee shops considering
          opening stores in China?            BUSS4.11 Decision Making
http://news.bbc.co.uk/1/hi/england/gloucestershire/8564814.stm

If you were Julian Dunkerton, chief executive of SuperGroup,
what would your strategy be now?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
http://news.bbc.co.uk/1/hi/england/gloucestershire/8564814.stm

If you were Julian Dunkerton, chief executive of SuperGroup,
what would your strategy be now?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
http://news.bbc.co.uk/1/hi/business/8563728.stm

If you were BA boss Willie Walsh, what would your strategy
be?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
http://news.bbc.co.uk/1/hi/business/8563728.stm

If you were BA boss Willie Walsh, what would your strategy
be?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
http://news.bbc.co.uk/1/hi/business/8561671.stm

If you were John Lewis chairman Charlie Mayfield what would your strategy be?




Judgement:                               Facts:                                 Creative:
What bad about it?                       Evidence / Statistics?                 All ideas are possible!




Think:                   Benefits:                                              Feel:
What has to happen next? What good about it?                                    What do you feel?
http://news.bbc.co.uk/1/hi/business/8561671.stm

If you were John Lewis chairman Charlie Mayfield what would your strategy be?




Judgement:                               Facts:                                 Creative:
What bad about it?                       Evidence / Statistics?                 All ideas are possible!




Think:                   Benefits:                                              Feel:
What has to happen next? What good about it?                                    What do you feel?
http://news.bbc.co.uk/1/hi/business/8513721.stm

If you were Toyota President Akio, what would your strategy be?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
http://news.bbc.co.uk/1/hi/business/8513721.stm

If you were Toyota President Akio, what would your strategy be?




Judgement:                               Facts:                   Creative:
What bad about it?                       Evidence / Statistics?   All ideas are possible!




Think:                   Benefits:                                Feel:
What has to happen next? What good about it?                      What do you feel?
Influences on corporate decision-
making
   Ethical position (real or perceived)
    ◦ How will the decision be viewed by key stakeholders
    ◦ Will moving production abroad match the business’
      ethical standards?
    ◦ Where are materials sourced from?
   Resources available             Also, don’t underestimate the
                                      importance of corporate
    ◦ Financial constraints
                                     objectives. Remember this
    ◦ Workforce                     has been an important theme
    ◦ Scarcity of materials              throughout this unit
   Relative power of stakeholders
    ◦ How might pressure groups respond?
    ◦ Will TUs become involved?

                                  BUSS4.11 Decision Making
 Activity
 Ryanair reduces Stansted flights

 What information would have been collated to help
  make this decision?
 What are the factors contributing to this decision?
 What are the advantages of using scientific decision
  making techniques for Ryanair?
 How might different stakeholders respond to this
  decision?




                                     BUSS4.11 Decision Making
Essay
 Jack Welch, CEO of GE, urges businesses
 not to sit on decisions. He advices “Don't
 set something aside instead of making a
 decision on the spot. In order to get
 speed, decisions at virtually every level
 have to be made in minutes, not days or
 weeks.” With reference to businesses you
 have studied to what extent do you agree
 with Jack’s views on making quick
 decisions. Justify your answer.

                        BUSS4.11 Decision Making

								
To top