Introduction to Business Decision Making

Introduction to Business Decision Making

Background information. Fashionable Kids Fashions which designs and manufactures children’s clothing had decided to close its Long Island City, NY production plant because of poor market conditions and an inability to complete with overseas imports. A buyer could not be found.

n Step 1: identify and define the problem. Closing the plant would put all 172 employees out of work, and negatively impact their families and the local community. The loss of the Fashionable Fashions tax base would further hurt the community.

n Step 2: generate and evaluate possible solutions . The alternatives identified by  FKF’s management included:

1. Simply closing the production plant on schedule.
2. Delaying the plant closing until all efforts have been made to sell it to another firm.
3. Offering to sell the plant to the employees and/or local interests.
4. Closing the plant, and helping employees find new jobs in the local area.

What are the other 3 steps in the decision making process? What are the advantages and disadvantages of each of these alternatives? Which one would you choose and why? What goes into making a good decision?

Answer

Background information. Fashionable Kids Fashions which designs and manufactures children’s clothing had decided to close its Long Island City, NY production plant because of poor market conditions and an inability to complete with overseas imports. A buyer could not be found.

Step 1: identify and define the problem. Closing the plant would put all 172 employees out of work, and negatively impact their families and the local community. The loss of the Fashionable Fashions tax base would further hurt the community.
Step 2: generate and evaluate possible solutions . The alternatives identified by  FKF’s management included:
1. Simply closing the production plant on schedule.
2. Delaying the plant closing until all efforts have been made to sell it to another firm.
3. Offering to sell the plant to the employees and/or local interests.
4. Closing the plant, and helping employees find new jobs in the local area.
What are the other 3 steps in the decision making process?
– Make a decision
– Have facts to show why you made your decision
– Examine details of decision that was made
What are the advantages and disadvantages of each of these alternatives?
1. Simply closing the production plant on schedule. Advantage: save money Disadvantage: having to close
2. Delaying the plant closing until all efforts have been made to sell it to another firm. Advantage: possibly being able to stay open for good. Disadvantage: Money being spent if you still end up having to close.
3. Offering to sell the plant to the employees and/or local interests. Advantage: Make more money selling. Disadvantage: You lose the company.
4. Closing the plant, and helping employees find new jobs in the local area. Advantage: Employees don’t take a lost
Which one would you choose and why? What goes into making a good decision?
Closing the plant and helping employees find another job makes more sense. When you sign up to have a job it’s not always guaranteed that you are going to stay there. The good thing about this is you have somebody to help you find another job it’s just that you have to start over. What goes into making a good decision is knowing that there’s a risk you have to take.