Std Grad BM - Unit 4.3 (New)1 Standard Grade Business Management Unit 4.3 (Unit 16 in Textbook) What aids decision-making?

Std Grad BM - Unit 4.3 (New)2 Information helps decision-making Business decisions must be based on as much information as possible. Information must be z up-to-date z accurate z available when needed z reliable z cost effective ICT has facilitated easier and quicker access to information.

Std Grad BM - Unit 4.3 (New)3 Information helps decision-making Information can be accessed from a variety of sources: z Internal computer files z www z Newspapers/Books z Letters z CD-ROM z People z TV

Std Grad BM - Unit 4.3 (New)4 INTERNAL zMarketing, eg has the latest advertising campaign been successful? zOperations, eg are goods being produced on time? zHR, eg how much money is left in the training budget? zFinance, eg are costs under control? Why would managers need to access information ? EXTERNAL zEconomic climate, eg do people have more money to spend? zCustomers, eg satisfied with quality of goods? zCompetitors, eg selling goods at lower price? zTechnology, eg are there new advances in technology?

Std Grad BM - Unit 4.3 (New)5 Types of Information PRIMARY SECONDARY INTERNAL EXTERNAL

Std Grad BM - Unit 4.3 (New)6 PRIMARY Gathered first-hand for particular purpose. z observing z interviewing z questionnaires z surveys Types of Information SECONDARY Information which already exists - gathered for one purpose, but can be reused for another. z Firm’s own reports z Government statistics z Libraries, z Internet

Std Grad BM - Unit 4.3 (New)7 INTERNAL Gathered from inside the organisation. z final accounts z sales statistics z staff turnover z training costs Types of Information EXTERNAL Information gathered from outside the organisation. z population census information z competitors’ company reports z buying habits of yr olds z new employment regulations

Std Grad BM - Unit 4.3 (New)8 QUANTITATIVE Information is based on facts and figures. It is factual and does not include judgements. eg there are 24 million mobile phones in UK Types of Information QUALITATIVE This information presents an opinion, often based on quantitative information. eg the most popular colour for training shoes is blue

Std Grad BM - Unit 4.3 (New)9 Information helps decision-making STRENGTHSWEAKNESSES OPPORTUNITIES THREATS Information can be used to prepare a SWOT analysis

Std Grad BM - Unit 4.3 (New)10 STRENGTHS z new product ranges z successful brand image z experienced staff z profitable business z increasing turnover z low labour turnover SWOT ANALYSIS WEAKNESSES z too many products at maturity z poor premises z high absenteeism z lack of diversification z poor funding of R & D z poor after sales service INTERNAL - within the organisation

Std Grad BM - Unit 4.3 (New)11 OPPORTUNITIES z new markets z new technology z changing tastes z increasing population z increase in average income SWOT ANALYSIS THREATS z interest rate rise z recession z increase in VAT z new laws, eg minimum wage z lower average income z action of competitors EXTERNAL - the general environment which could affect an organisation and over which they have little control

Std Grad BM - Unit 4.3 (New)12 Types of decisions Strategic decisions – long term and affect entire business, eg merge with another company. Senior managers and directors make these decisions. Tactical decisions – taken more frequently and less important, usually to tackle an issue or problem, eg methods of advertising to be used. Taken by middle management. Operational decisions – day-to-day decisions taken by lower management. Repetitive decisions, eg staffing levels, methods of delivery of goods.

Std Grad BM - Unit 4.3 (New)13 Decision-making flow chart Objectives of the business Identify the problem Implement and Review – was it successful? Collect and analyse data Consider options and take decisions

Std Grad BM - Unit 4.3 (New)14 Decision-making model - Credit Identify the PROBLEM Identify the OBJECTIVES of the solution Identify the CONSTRAINTS GATHER the information ANALYSE the information DEVISE possible solutions SELECT the best solution COMMUNICATE the decision Plan and IMPLEMENT the decision EVALUATE the effectiveness of the solution POCGADSCIEPOCGADSCIE