Decision Making Scenario

[BMGT 391]

[Date: - ]

Decision Making Scenario

Introduction

International economic scenarios have compelled the companies to take drastic measures for competing against other companies. One of the chief tools of attracting customers is by lowering prices (Vaughn, 2010). Companies often scale the operations to increase productivity and extend the sales discounts in achieving sales targets. In order to keep the cost at the minimum, companies often cut down on the human resources to reduce their working capital requirement. It is often perceived in the backdrop of reduction in sales revenue and volume that adding more human resource will increase the cost of the business and will result in lower profitability. We are presented with a case of Paul's Furnishing which is facing intense competition from new comers in the area. They have taken the steps to offer discounts and carryout massive expansions. These expansions have been in-line with the strategic goals of the store to offer a wide assortment of the products from under one roof. The store has also taken adequate steps to improve employee customer service which is a key element in the organization's competitive position (Nutt and Wilson, 2010). We will be reviewing the case and analyzing the problems of the store. We will look into the Sally's decision's quality and their feasibility. This paper will also include the challenges being faced by the Mr. Berman and will suggest solutions.

Discussion

Main Issues in the Case

Competition: The store is facing severe competition from the wholesaler giants like Wal-Mart and others which is eroding the profits of the store. It is struggling in terms of sales due to numerous retailers establishing their stores for the same target market. The store was enjoying a central position but as the competition is increasing, it has suffered in the sales revenue. Two companies which started their operations in the similar year as the Paul's store has been forced to close down due to competition. This has also highlighted a strategy failure of old companies working in the area.

Short Staffing: the store in order to keep the cost of operations low has put a hold on hiring new staff. The store on one hand is expanding but is unwilling to hire more staff to carry out the jobs. It has increased the burden on the current employees. The challenges have also increased and the company has not hired staff of specialized skills to meet the new tasks.

Increased Working Hours: The store has increased the working hours of employees by minimum 20 hours per week. They now have to work more hours and with the shortage of staff.

Reduction in number of customers: The new stores have attracted a significant number of customers and the sales of the store are down by up-to 14%.

Employee dissatisfaction: Employees are very dissatisfied as they now have to work on weekends, have to carry-out additional tasks assigned to them and have to work long hours to achieve that.

Lack of Planning: The store has failed to analyze the ...