Managerial Decision Making

This report discusses the problem of a firm identified from a case study and provides different steps of managerial problem solving to address it. It includes the identification and definition of the problem, generation of solutions, and implementation of the best solution. Tools and techniques like brainstorming, fishbone diagram, and affinity diagram are used in the problem-solving process.

Running Head: BUMGT5980- Managerial Decision Making
BUMGT5980- MANAGERIAL DECISION MAKING

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BUMGT5980- Managerial Decision Making
Executive summary
In this report, a problem is identified from the case study that has created hindrance in
productivity of a firm. Different steps of managerial problem solving like identification of
problem, definition of problem, generation of solution and implementation of solutions are
elaborated. These steps have helped to gather different solution and identify proper solution
for implementation. Different tools and techniques of problem-solving advised by Woods et
al. (2009) are implemented in this report. This includes brainstorming, fishbone diagram,
affinity diagram, and others.

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Table of Contents
1. Introduction............................................................................................................................4
2. Discussion..............................................................................................................................4
a. Background of the problem................................................................................................4
b. Definition of the problem...................................................................................................5
c. Generation of solution for the problem...............................................................................6
d. Critical evaluation of the solution......................................................................................9
e. Implementation of solution and action plan.....................................................................10
3. Conclusion............................................................................................................................13
Reference list............................................................................................................................14

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1. Introduction
Managerial decision has a great impact on the business and these decisions may create
difficult situations sometimes. Baking industry of Australia is growing rapidly and this
industry has earned near about $3581m at the end of 2018 (Statista.com, 2019).
Organizations of baking industry are bound to maintain quality as food directly impact on
human body. Due to this reason, managers of baking industry make strict policies for
ensuring high quality of product. Sudden decisions are taken on immediate grounds and it
leads to dissatisfaction in employees. This study is focusing on the case study of XYZ
Company. Sudden managerial decision regarding changes in organizational structure has
caused a worker's strike. This study is discussing the problem and along with the best
solutions to address it.
2. Discussion
a. Background of the problem
The XYZ Company sells cakes and chocolates to their customers and quality of those
products has fallen recently. Customers have complained regarding quality of products as
that has damaged their reputation. The company has a good infrastructure and a large human
resource. However, the managers have taken a rigid decision without proper evaluation of the
situation. They have announced to hire 4 supervisors and changed the organizational
structure. This has decreased motivation of employees and this sudden change has made
workers understand that the management does not trust them. Hence, they have declared
strike, which is the main problem of this firm.

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b. Definition of the problem
Defining a problem is the most essential part of undertaking managerial decisions.
Hence, it is essential in this stage to build a proper understanding of the problem in detail.
This can help to frame solution to mitigate the identified problem. According to Woods et al.
(2009), different tools like SWOT analysis and 5w can be used to define and evaluate a
problem properly. In addition, 5w technique can help to redefine and clarify different
elements of a problem.
Strength Weakness
● A large number of human resources
● Good infrastructure
● Good brand image
● Lack of training among workers
● Lack of proper leadership
● Less creation of worker engagement
opportunities
● Improper decision making
Threats Opportunities
● Workers have no trust in hierarchy
● Threat of worker turnover
● Chances of mentorship and training
programs
● Less problem about funding
SWOT analysis is a great tool to analyze the internal environment of an organization.
This approach of problem identification is quick and helps to identify future risks and
opportunities of a firm (Wood et al. 2009). After analyzing the SWOT analysis, it can be said
that the main cause of this problem is improper decision making and lack of proper

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leadership. Failure of management can impact on operations of a firm and different impacts
like staff turnover can occur (Von Hippel & Von Krogh, 2015).
5Ws analysis
What Strike of workers that has impacted on production and revenue collection of
the company
Where XYZ bakery company, Australia
When After the change in organizational structure
Who This problem is about the workers
Why Lack of trust in senior management and administration and this problem has
occurred due to improper decision making and leadership
From the above table of 5Ws, it can be analyzed that strike of workers is the main
problem in XYZ Bakery Company that has occurred due to inappropriate decision taken by
the administration. Moreover, improper leadership has failed to build an understanding
among workers regarding the change. As opined by Alvesson & Kärreman (2016), failure in
leadership can impact an organization of team and group, which erodes standard of
productivity. The problems that are identified impacts on an organizational culture, which
occurs due to management failure (Amankwah-Amoah, 2016). These problems can be
categorized as dynamic problems, which can occur over and over again.
c. Generation of solution for the problem
Identification of potential solution is required after identifying the problem.
According to Wood et al. (2009), several tools and techniques are there that can help in

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solving issues caused by managerial decisions. Selection of appropriate tools can help in
moving the organization from its current problematic stage to the desired stage. Effective
tools that can help in figuring the solution are brainstorming, mind mapping, six thinking hats
and Fishbone diagram (Wood et al. 2009). In the case of this present case study,
Brainstorming and fishbone diagram are effective tools that can help in solving the problem.
As stated by Coccia (2018), different ideas to solve a problem can be generated with
the help of divergent thinking tools such as brainstorming and Fishbone diagram. As
mentioned by Kaid, Noman, Nasr & Alkahtani (2016), brainstorming is an effective tool that
is used by leaders and managers for solving complex business issues. This tool is appropriate
for non-evaluative and non-critical atmosphere. However, no criticism and no judgment are
required in case of brainstorming and these are the limitations of this tool (Wood et al. 2009).
● Training of staff
● Promising rewards
● Recognizing
contributions
● Direct
communication with
staff
● Mentoring
● Self-development of
leaders
● Taking feedback
● Motivating staff
● Silent monitoring
● Listening to
complaints
● Developing team
skills in staff
● Finding gaps in
performance
Table 1: Brainstorming
As all of the above-mentioned ideas cannot be controlled easily, more evaluation of
the problem is required. As mentioned by Von Hippel & Von Krogh (2015), in-depth
evaluation may help in identifying the best solution to an organizational problem. As there
are limitations in brainstorming tools, Fishbone diagram is being prepared to evaluate the
cause and effect behind the problem mentioned in the considered case study.

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Fishbone diagram is an effective divergent thinking tool that can help in
understanding the cause and effect of a problem. As mentioned by Dobrusskin (2016), it is
also known as Ishikawa diagram or cause-and-effect diagram. Woods et al. (2009) have
mentioned that this tool is used for displaying all the causes behind the problem and its
possible solutions. Impact of problem, reasons behind problem and potential contributors can
be systematically identified with the help of fishbone diagram.
Figure 1: Fishbone diagram
The above mentioned Fishbone diagram is denoting categories that are contributing to
the problem of XYZ Company. Both brainstorming and Ishikawa diagram have helped in
understanding cause, effect and potential solutions available for the current problem of this
company. It has been clearly understood that leaders and managers are not able to make
proper decisions within this organization. Leaders and managers do not have a good
relationship with their employees as they do not listen to their employees. As the
management have not trusted their employees and not included them in the decision-making
process, they are resisting the change. Main causes of the problem in this company are,
● Lack of direct communication between workers and management

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● Less opportunity for workers to be involved in the decision-making
● Lack of mentoring and skill development opportunities
The impact of worker’s strike on the company are mentioned below,
● Dissatisfied workers can resign from this company
● Performance of the company can be hampered
● Negative impact on revenue generation after this incident
● Lack of efficiency in meeting customers’ need
d. Critical evaluation of the solution
For mitigating the problems it is essential to assess different potential solutions that
are achieved through brainstorming. In the above section of problem solution generation,
different potential solutions are explored through brainstorming and fishbone diagram.
Hence, this approach can be said as divergence thinking of problem-solving. As stated by
Colzato, Szapora, Lippelt & Hommel (2017), divergence thinking of problem-solving is a
web-like a pattern that helps in establishing connections between various ideas.
In this section, convergence thinking has been adopted to gain ideas for solving the
problem properly. As mentioned by Jaarsveld & Lachmann (2017), convergence thinking
helps in narrows down the number of ideas for generating a single solution. Convergent
differs from divergent because it is systematic and linear.
For achieving the best solution to mitigate the problem that has arisen in XYZ
Company of Australia, a simple technique of affinity diagram was chosen. An affinity
diagram is a tool that helps in gathering large amounts of data that can be organized into
various groups (Lucero, 2015). The affinity process gets initiated after generation of ideas to
solve a problem through brainstorming.

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Figure 2: Affinity diagram to solve the problems
These are some solutions that are identified through the help of affinity diagram. For
application of these solutions, it is essential for the management to provide proper time and
money. For example, making arrangements for funds is essential for organizing a training
program for staff. Organization of training programs helps to improve competencies of staff
and helps to increase their engagement with the company. Moreover, leadership issues can be
solved by silent monitoring of staff, which can help to identify gaps and through motivation
they can be encouraged to solve the gaps. Hence, trust can be rebuilt among them.
e. Implementation of solution and action plan
The last stage of problem-solving is implementation of the solution. This is an
essential stage, which can help to mitigate the problem of poor leadership and improper
management of staff that has caused employee strike in this company. As opined by Collier-
Meek, Sanetti, Levin, Kratochwill & Boyle (2019), in the implementation phase of problem-
solving analysis of different factors that can impact or support the process needs to be
MotivatingstaffSilentmonitoring

Funding (6/10)
Intention of workers (7/10)
Hindering forces
Change in the
relationship
between workers
and the
management
through direct
communication
and mentoring
program
Improved relationship between and management (8/10)
Increase in performance and firm produc
Helping forces
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analyzed. As opined by Woods et al. (2009), different tools can be used in this phase of
solution implementation. This includes force-field analysis, how-how diagram, and others.
In this case scenario, force field diagram has been implemented for analyzing
different factors that impact on the solution. As said by Shrivastava, Shrivastava, &
Ramasamy (2017), force field analysis is a framework that helps to identify and analyze
some factors that influence a situation. There are two forces that include hindering forces and
helping forces. Hindering forces can cause a barrier during the process of solution
implementation. On the other hand, helping forces helps to drive the movement of
implementation of solution.
Figure 3: Force-field analysis
Problems in a firm like strikes generally occur due to improper managerial practices
and poor leadership. A change is essential in this firm that can help to increase the
relationship between workers and management. This can be brought through open
communication and organizing a mentorship program. Different barriers like problem in

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funding can occur, which can delay the process of mentorship program (Cheng & Gorley,
2015). However, helping factors can also be gained from implementing the change like
improvement in firm’s performance. This is because the skills of workers can increase
through effective leadership and mentoring program that can help to improve the quality of
products.
For solving the present problem, it is important for leaders and managers of this
company to develop a good relationship with their employees through direct communication
and mentoring process.
● Objective: To Change in the relationship between workers and the management
through direct communication and mentoring program
● Start date: 8th September 2019
● End date: 20th September 2019
● Assumed budget: $5000 for arranging mentoring program and meetings with workers
● Communication by: Senior manager of the XYZ Company
● Communicated to: The leaders, managers, and workers
● Mode of communication: Attaching notice on the notice board
● Steps involved:
Step 1: Gathering information regarding the problem
Step 2: Assessing the reason behind worker’s dissatisfaction
Step 3: Inviting employees in a meeting to listen to them
Step 4: Conducting the meeting and understanding point of views of employees
Step 5: assuring workers that they will be involved in further major decision-making
processes
Step 6: Conducting a mentoring program to help employees to understand the process
of ensuring product quality

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Step 7: Giving responsibility to an employee to check each product before delivery
Step 8: Gathering feedback of workers regarding this change implementation\
Step 9: assessing performance after these initiations
Step 10: Making commitments to repeat these initiations in future
3. Conclusion
It can be concluded that a problem can be solved properly by using effective divergent
thinking tools. Here, 5Ws and SWOT analysis have been employed to understand evaluate
the current state of the company. It has been understood that improper decision making by
leaders and managers of this company are the main causes of the problem. Force field
analysis has helped in implementing the solution of changing the relationship between
workers and the management through direct communication and mentoring program.

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