Contents
Introduction 2
Different schools of management 2
Classical school of management 2
The Human Behaviour School(Koontz 1961) 3
The Mathematical/Quantitative School(Koontz 1961) 3
Systems School(Ali 2014) 3
Contingency(Ali 2014) 3
Sources of data 3
Models of decision 4
Types of Management 5
Decision Making Tools 6
S.W.O.T. analysis 6
P.E.S.T.E.L. 7
Porter’s Five Forces 7
Decision Tree-diagrams 8
Conclusions: 9
Reference List: 9
Introduction
Management decision, is important in order to identify, implement, and develop solutions creating unique products or services for targeted costumers (Monika Juneja 2017). Therefore, management decision making is the process that stablish the long-term success of an organisation.
The case of study used is WM Morison’s supermarkets Plc, as the 4th biggest with market share in the U.K (Sullivan and Megaw 2017), the final strategy plan is to expand the business to France taking in account other alternatives.
Different schools of management
Harold Koontz (1961) argues that, analysing the people in group and processes, allow to identify principles and build theories of management from them (Koontz 1961).
Schools of management are frameworks, which allows the study of management in order to increase efficiency. Therefore, each school is based in multiple and different approaches as follow:
Classical school of management
This school has aim to manage work and organisations in an efficient way, this can be grouped as follow:
a) The Scientific School(Taylor 1919)
– Gestures could be reduced to improve efficiency via scientific methods;
– Pay for performance incentives;
– Managers and workers have mutual interests;
– Managers are responsible for planning, workers are responsible to execute the plan.
b) The Bureaucratic School(TERRY 2017)
– Decisions based personal and loyalty;
– Hierarchized organisation, with rules, and batch records for each task;
– Promotions based in expertise;
– Jobs well defined;
The Human Behaviour School(Koontz 1961)
– Based in human relations;
– Analysis of personality dynamics;
– “people should understand people” (Koontz 1961);
– Psychology focused.
The Mathematical/Quantitative School(Koontz 1961)
– Management, organisation, planning or decision making can be translated into logical symbols, in order to make decisions.
Systems School(Ali 2014)
– In an organisation, all collaborators work towards the same goal;
– The System are all inter-connected and elements are seen as a whole;
– Systems are developed to achieve a specific goal.
Contingency(Ali 2014)
– Resource to analysis of conditions and environment;
– There are no rules to solve problems;
– Every problem is analysed from various points of view.
Therefore, in order to expand to France, it has to consider factors such as political, economic and social forces. Political due to the fact that will be a new market and new laws will be applicable, economical because of economic freedom and competitivity, and finally social forces due to beliefs and values of the French society. All of this in order to understand the environment to achieve the final goal.
Sources of data
Moreover, to consider the long-term success of the organisation, it must be able to manage information as tool to find patterns, and create strategies based on external input. However, to have access to external information, a qualitative collection process must be conducted, which can be done by the following methods:
A. Expert interview
This can be done base of face-to-face conversational method with in a structured form. In this method, some information can be acquired in order to understand the costumers.
B. Street ethnography
In the case of ethnography, is also an important source of information, that information will allow me to understand the cultures and life style, to be able to make available in the products that will sell in those cultures.
C. Case of study
Is used to study real-life situation, this method might be applicable in the case of developing new products in order to create customer satisfaction.
Therefore, after the collection of data, it must be organised into groups and themes to be supportive of decision making information. Moreover, this has to consider quantitative data, which can be collected by the following techniques:
A. Surveys
Like questionnaires, surveys are also a good tool, however its versatility, allows it to gather information much quicker, and in larger numbers of customers. The organisation will benefit of this method, because its less time consuming to gather the information and to process it.
B. Tracking
With tracking systems can be also a very useful tool, to understand the engagement of costumers in a certain product or overall satisfaction.
C. Questionnaires
Questionnaires are a very powerful tool in this case due to be able to gather considerable amounts of information and try to understand the popularity of competitors in a numerical scale.
Models of decision
In order to define the strategy and in accordance with Eisenhardt K. and Zbaracki (Eisenhardt and Zbaracki 1992) the decision maker collects the information, that he/she requires to develop and define alternatives and then select the most appropriate to achieve the goal.
Furthermore, in order to support the strategic mission to get into the French market, the organisation consulted figures of that market (The 2017 Index of Economic Freedom 2017), where it suggests that the market has a good framework, and markets have confidence in the new elected president (Rennison J. 2017).
Another, with which can be compared with the rational model is the administrative model. Both can be compared as follow:
Rational Administrative
Advantages Disadvantages Advantages Disadvantages
• Identify and verifies the problem;
• Best solution to the problem;
• Reduced complexity;
• Well planned; • Time consuming;
• Expensive process;
• Delay the decision;
• Limits of human capabilities
• Follows standard operating protocols for chosen alternative;
• Focus on satisficing;
• Different opinions and motivations within the group of managements;
• Lack of time of the group;
• Lack of decision quality;
• Different goals across the organisation.
(Decision Innovation 2017) and (Verma 2014)
Types of Management
Types of management, has the aim to understand the style of behaviour and its different settings.
There are two main styles of management, macro-management and micro-management which are described as follow:
A. Micro-management is identified by overseeing work in progress and how it’s done, controlling everything around them, which leads to insecurity of them self’s, furthermore, they dislike subordinates to make decisions without consulting them, and are very easily irrigatable (White 2010).
B. Macro-management consists of an open approach by the manager which allow employees to perform tasks with minimal supervision. This approach can be controversial, because collaborators in some occasions might require support or feedback.
Decision Making Tools
S.W.O.T. analysis
S.W.O.T. analysis has the aim to aid the strategy formulation, analysing external opportunities and threats, in order to formulate opportunities avoiding threats. Furthermore, weaknesses and internal strengths analysis can define how the organisation is performing internally (Chang H. 2006). This tool is based in financial resources, surveys market research and performance indicators and aids the tactical decisions.
P.E.S.T.E.L.
P.E.S.T.E.L. describes the method that frameworks in a macro-environment are analysed. Moreover, organisations are not able to control these macro-environments.
This tool analyses multiple factors:
Political: government stability, laws, tax systems, trade restrictions, corruption, bureaucracy and stability of neighbours.
Economical: Inflation, taxes & duties, finance and credit, exchange ratings, working practices, cost of living and globalization.
Social: Lifestyle, demography, education, religions, level of consumerism.
Technological: Level of research funding in government and industry and their focus, type of technology used.
Economical: Environmental issues and relation with the organisation, environmental laws, waste disposal management, energy consumption.
Legal: Regulations for monopolies, intellectual property laws, consumer protection laws. (Gruning R., and Kuhn R 2014)
In this tool, the decision conditions are considered a Risk, due to its spectrum of factors to support strategic decisions.
Porter’s Five Forces
In this tool, it is approached the competitiveness between competitors and new entrants and the power of suppliers and customers. Therefore, it analyses markets in order to avoid losses in the market share.
Furthermore, it suggests that the more an organisation invest in sustainable competitive advantages, the percentage of the market share will maintain. This tool is based in the economic factors, however, it lacks of a formula for qualitative analysis (Michaux 2015).
Decision Tree-diagrams
Tree-diagrams can be used for multiple purposes, and it is a method used to identify consequences or to achieve operational and strategic goals. In this tool, after all alternatives are given, it is possible to predict a new node based in new data.
The utility for tree-decision management, supports creating more opportunity’s, stimulating creativity and approaches which supports strategic and tactical decisions.
Conclusions:
Reference List:
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• Rennison J. (2017) ‘Nasdaq, S&P 500 edge up to new highs after Macron win’. Financial Times [online], available from < https://www.ft.com/content/ff5664d0-8aae-3744-915c-cc3900844b54> [10 May 2017]
• Sullivan C. and Megaw N. (2017) ‘Morrison’s turnaround gains pace with 3% sales rise’. Financial Times [online], available from <https://www.ft.com/content/9114f740-3095-11e7-9555-23ef563ecf9a> [09 May 2017]
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• The 2017 Index of Economic Freedom (2017) France [online] available from <http://www.heritage.org/index/country/france> [10 May 2017]
• Verma D. (2014) ‘Study and Analysis of Various Decision Making Models in an Organization’. Journal of Business and Management 171-173
• White, D. (2010) The Micromanagement Disease: Symptoms, Diagnosis, and Cure. 1st edn. Alexandria