Business Decision Making Project

This project examines business decision making by analyzing customer behavior at Sainsbury's, a UK supermarket retailer. It investigates the reasons behind the shift from traditional shopping to online shopping, driven by technological advancements and multichannel shopping evolution. The project utilizes data collection, analysis, and visualization techniques to draw conclusions and provide recommendations for Sainsbury's.

BUSINESS DECISION MAKING

Table of Contents
INTRODUCTION..............................................................................................................1
TASK 1 ............................................................................................................................ 1
a) Planning for data collection .....................................................................................1
b) Survey methodology and sampling frame used........................................................1
c) Designing a questionnaire for collection of data.......................................................2
TASK 2.............................................................................................................................3
a) Summarising the data collected data ......................................................................3
b) Analysing results of survey and drawing conclusion................................................5
c) Analysing the data using measures of dispersion.....................................................6
d) Using quartiles, percentiles and the correlation coefficient for drawing conclusion . 6
TASK 3 ............................................................................................................................ 7
a) Graphs related to survey..........................................................................................7
......................................................................................................................................9
....................................................................................................................................10
....................................................................................................................................11
....................................................................................................................................12
b) Creating trend lines................................................................................................ 12
c) Poster presentation.................................................................................................13
d) Formal report for publication in Retails Times Magazines......................................13
TASK 4........................................................................................................................... 13
a) Different software that helps in decision making ...................................................13
b) Network diagram and the critical path ...................................................................15
c) Using a financial tool for decision making, advising a business planning on a
project or investment.................................................................................................. 17
d) Calculation of NPV................................................................................................. 17
e) Calculating IRR ......................................................................................................18
CONCLUSION............................................................................................................... 18
REFERENCES...............................................................................................................20

INTRODUCTION
Business decision making is one of the crucial function of management of a
company. As the term is concerned with a business problem, an effective decision
making assist an organization in attaining its expected goals and objectives (Janeiro,
2018). Business decision making can be described as a scientific well defined and tried
process of choosing the best course of action from amongst different alternatives after
detailed evaluation and analysis to reach at a solution. The present project report is
about the primary and secondary research undertaken by Sainsbury, a supermarket
retailer in UK, regarding how the customers are changing their shopping habits and
preferences, determining what are the underlying factors which are motivating
customers to change their habits. Further, the role of socio-impact and shopping
platforms in customers' changing preferences.
TASK 1
a) Planning for data collection
Data collection is the process of assembling or capturing and measuring data so
that appropriate information from all the possible relevant sources to find answers to the
issues included in research. It also includes testing hypothesis and evaluating the
outcomes. Data can be both qualitative and quantitative (IJdens, 2015.).
For the research purpose, Sainsbury will collect data by the way of
questionnaire that will put up some questions for the intended sample population to
answer them. The questionnaire will start with the general questions like how often do
you shop, where do you like to shop like from mall, super market, online shopping or
traditional shop. What are the factors that has led you to shop from online method, does
socio economic factor impacts your purchasing decision, is brand loyalty the reason for
the change in habits etc.
Sampling is the process in which a preset number of observations are taken out
of large sample population. In this research, the sample population is 20 which
comprises of college students. For rating the answers of the respondents, ordinal scale
of rating will be used such as when a question of purchasing preference is asked, option
will be given in the form of online, traditional shops, supermarket etc (DEMİRGÜNEŞ,
2016).
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b) Survey methodology and sampling frame used
Survey methodology is the field of applied statistics of human research surveys
which is conferenced with sampling of the units from a large population or data set with
the help of different data collection methods and techniques such as designing
questionnaire. Primary data collection is the research methodology where the
information is gathered by the researcher himself first handedly. Responses will be
collected by the sample population by sending emails. People will be asked to give their
opinion regarding certain question and sent their responses back to the researcher
(Wheelen and et.al., 2017).
The sample frame for the research is students of the college. A sample of 20
students has been taken for collecting the data regarding changing habits of consumers
in respect of their shopping preferences.
c) Designing a questionnaire for collection of data
Name :
Age:
Telephone no. :
QUESTIONNAIRE
Q.1 How often do you shop ?
 Once in 15 days
 once in 2 months
 once in 6 months
 once a year
Q.2 How often do you use online shopping sites?
 once a week
 once in 15 days
 once in 30 days
 more than 30 days
Q.3 Do you prefer online shopping than traditional shopping ?
 yes
 no
Q.4 What are the factors that motivates you towards online shopping?
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 Convenience
 saves time
 wide product range
 better prices
Q.5 what factors restricts you from shopping online?
 Payment security
 product risk
 return policy
 non delivery of products
Q.6 What factors restricts you from traditional shopping ?
 High prices
 lack of variety of products
 location
 unavailability to 24*7 access
TASK 2
a) Summarising the data collected data
Statistics
Q.1 How
often do
you
shop ?
Q.2 How
often do
you use
online
shopping
sites?
Q.3 Do
you prefer
online
shopping
than
traditional
shopping
?
Q.4 What
are the
factors
that
motivates
you
towards
online
shopping?
Q.5 what
factors
restricts
you from
shopping
online?
Q.6 What
factors
restricts
you from
traditional
shopping ?
N
Valid 20 20 20 20 20 20
Missi
ng 0 0 0 0 0 0
Mean 2.10 1.80 1.35 2.40 2.10 2.10
Std. Error of
Mean .250 .225 .109 .266 .240 .240
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Median 2.00 1.50 1.00 2.00 2.00 2.00
Mode 1 1 1 1 1 1a
Std. Deviation 1.119 1.005 .489 1.188 1.071 1.071
Variance 1.253 1.011 .239 1.411 1.147 1.147
Range 3 3 1 3 3 3
Minimum 1 1 1 1 1 1
Maximum 4 4 2 4 4 4
Sum 42 36 27 48 42 42
Percenti
les
25 1.00 1.00 1.00 1.00 1.00 1.00
50 2.00 1.50 1.00 2.00 2.00 2.00
75 3.00 2.00 2.00 3.75 3.00 3.00
Q.1 How often do you shop ?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 8 40.0 40.0 40.0
2 5 25.0 25.0 65.0
3 4 20.0 20.0 85.0
4 3 15.0 15.0 100.0
Total 20 100.0 100.0
Q.2 How often do you use online shopping sites?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 10 50.0 50.0 50.0
2 6 30.0 30.0 80.0
3 2 10.0 10.0 90.0
4 2 10.0 10.0 100.0
Total 20 100.0 100.0
Q.3 Do you prefer online shopping than traditional
shopping ?
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Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 13 65.0 65.0 65.0
2 7 35.0 35.0 100.0
Total 20 100.0 100.0
Q.4 What are the factors that motivates you towards
online shopping?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 6 30.0 30.0 30.0
2 5 25.0 25.0 55.0
3 4 20.0 20.0 75.0
4 5 25.0 25.0 100.0
Total 20 100.0 100.0
Q.5 what factors restricts you from shopping online?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 8 40.0 40.0 40.0
2 4 20.0 20.0 60.0
3 6 30.0 30.0 90.0
4 2 10.0 10.0 100.0
Total 20 100.0 100.0
Q.6 What factors restricts you from traditional shopping ?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
1 7 35.0 35.0 35.0
2 7 35.0 35.0 70.0
3 3 15.0 15.0 85.0
4 3 15.0 15.0 100.0
Total 20 100.0 100.0
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b) Analysing results of survey and drawing conclusion
From the above table, it can found out that mean or average regarding how often
people shop is 2.10. Average of how often people visit online shopping site is 1.80, for
preference of online shopping over traditional shopping is 1.35. Median is the value that
divides the data set into upper and lower half (Hair Jr and et.al., 2015). The median of
the data set related to how often people visit online shopping site is 1.5. Mode is that
number in the sample population that occurs most often. The mode of the data set for
factors that attracts people towards online shopping site is 1.
c) Analysing the data using measures of dispersion
Dispersion reflects the scatterings of the data or variables in the data set.
Measures of dispersion are variance, standard deviation, range, mean deviation,
quartile deviation etc. The standard deviation of the how often people shop is 1.119 and
variance is 1.253. Similarly, what factors restricts people in going to mall or high street
malls is 1.071 and variance is 1.147. Range is one of the measure of dispersion which
shows the highest and lowest values in a data set. The range of the data set regarding
the preference of people of online shopping over traditional shopping is 1 while for the
data set relating to why people do not go to high street shops and malls is 3.
d) Using quartiles, percentiles and the correlation coefficient for drawing conclusion
Quartiles is a kind of quantile like Q1, Q2, Q3. The Q1 can be defined as the
middle value between the smallest value and median in a data set (Gerbl, McIvor and
Humphreys, 2016). Second quartile is the median of the sample population while third
quartile is the middle value of highest value and median value in a data set. Q1 of the
data set related to how often visit online shopping site is 1 while Q3 is 3. For the data
set related to why prefer online shopping sites over traditional shopping , the Q1 is 1
while the Q3 is 3.25.
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TASK 3
a) Graphs related to survey
Interpretation : From the above graph, it can be concluded that majority of
people that is 8 shop in every 15 days while 5 respondents said that they shop in every
2 months. This means that majority of the students shop quite often.
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Interpretation : From the above graph, it can be seen that hghest number of
people around 10 of them out 20 respondents visits online shopping once in a week, 6
of them said that they visits the sites in around 15 days. From this, it can be seen that
people are shifting their shopping platforms from malls to online websites.
8

Interpretation : It can be interpreted from this graph that majority of people now
prefer to shop from online websites rather than going to high streets shops or
supermarkets or malls. From this, it can be clearly seen that technological advance has
overtook the business from the malls and shops (Rosemann and vom Brocke, 2015).
9

Interpretation : From the above graph, it can be seen that convenience is the
factor that highly motivates people in shopping from the online websites. 5 said that
online platform offers wide variety of products that drives them towards this way of
shopping.
10

Interpretation : From the graph, it can be seen that payment security in online
shopping restricts them a bit while doing shopping from this platform. While 6
respondents said that they doubt the return policy of the online sellers. These were the
factors that highly restricts people from shopping online.
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Interpretation : It can be seen from the above graph that higher prices and lack
of wide range of products in the malls and shops discourages majority of sample
population in shopping from such high street shops and malls.
b) Creating trend lines
Sales of Sainsbury for the last 5 years and its trend analysis is shown below:
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Interpretation : It can be seen from the trend analysis of the sales of the
company that it is showing upward trend which means that sales are increasing in the
last two years after it fell in the year 2016 (Sainsbury (J) PLC, 2019).
c) Poster presentation
(Enclosed in poster)
d) Formal report for publication in Retails Times Magazines
Report
To Retail Times Magazine
A survey was conducted regarding how the technological advancement impacted the
high street shops and malls. After analyzing the responses from the 20 college
students, it was concluded that majority of the people are preferring more of online
shopping than traditional shopping because of the easy access to the online stores
24*7. This was the major motivator for the students which drove them towards online
platform. Some of were of view that low prices and time saving are another reasons
why their preferences changed over time. This has all become possible due to the
technological advancement in the recent times. People were also asked about the
things which restricted them in going to malls and high street shops. They said that
higher prices and lack of wide range of products discouraged them.
TASK 4
a) Different software that helps in decision making
Transaction processing systems (TPS) : It is a system that processes the
transaction data. It performs the functions of collecting, storing, modifying and retrieving
the transaction of the business. For example point of sale, credit card payments.
Atomicity, Consistency, isolation and Durability (ACID) is considered as properties of a
database transaction. When a single logical operation is performed on a particular data,
then it is called as transaction.
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The characteristics of a good transaction processing system shall include
 Reliability : The transactions so processed must be reliable and accurate
because it were to breakdown the business could face huge losses as customers
would not be able to nuy their products.
 Inflexibility : A good TPS must be inflexible and it should work in same manner
for each and every transaction as long as the system software is used by the
business organsiation.
 Rapid response : By the application of transaction processing system, the
transaction can be processed very quickly.
 Controlled processing : One of the characteristics of TPS is that , it shall allow
its authorised users to have its access at any time (Transaction Processing
Systems: Application & Examples, 2019).
Management information system (MIS) : It is a computer software system that
collects data from various online systems, analyses such data to convert into
meaningful information and finally reporting it to the management for assisting in its
decision making. The objective of MIS is to improve the quality of decision making in an
organization.
This plays a important role in a business because it very efficiently manages the
data of a business and provides an easy access to the information that ultimately helps
in improving the quality of the decisions taken in an organisation. This helps in making a
company successful.
Characteristics of MIS :
 It is related to the entire system of an organisation.
 It is management oriented. The design of a good MIS system should include a
top to down approach. This means that system development shall begin from
ascertaining the needs of management and overall objectives of the company.
 MIS is an integrated system which comprises all the subsystems within an
organisation.
 Flexibility is an important characteristics of MIS. A management information
system must be flexible enough to adopt any business changes that is, it can be
modified as per the organisational needs and requirements.
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 Accuracy and reliability is another essential characteristics which means that
information provided to the management by the way of MIS increases the
efficiency of the decisions because of accuracy and reliability of the information
(Litvaj and Stancekova, 2015).
Decision Support System (DSS) : It is an information system which facilitates
organisation it its decision making process. The system gathers data and analyses it so
that a firm can take more rationale based on facts and evidences regarding operations,
planning and sometimes management too.
The information system can be effectively used by the operation management
and at other planning levels for compiling data and information and for synthesising it
into the actions.
The characteristics of DSS are as follows :
 These information system are constructed especially for facilitating the decision
making process in an organisation (What are characteristics of a decision
support system, 2015).
 It supports the decision making process instead of automating the decision
making.
 It has the capability of modifying itself in accordance with the changing needs of
the business.
b) Network diagram and the critical path
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From the above table and diagram, it can be seen that if the path is followed
which is highlighted in red, then the project will take the shortest time to complete all of
its activities. The red highlighted area is the critical path that should be followed by the
management of an organisation to complete its project in the least time. This will
increase the efficiency of the organisation and will also result into cost reduction as
unnecessary delay will be avoided by taking long route for completing the project.
c) Using a financial tool for decision making, advising a business planning on a project
or investment
Net present value is one of the financial tool that helps in evaluating the feasibility
of the project or investment. It tells the management whether it shall invests its funds in
a particular project or not. It depicts that if taking up of the project would add to the
value of the organization or not (Weygandt and et.al.,2018).
NPV takes into account the present value of money which discounts the cash
inflows back in period for knowing the profitability of the investment. It is calculated by
the following formula: NPV = Present value of cash inflow – present value of cash
flow over a time
If the NPV calculated is positive, then it should be accepted by the management
of the company as it will add to the value to the wealth of the company. If the NPV of an
investment comes out to be negative, then it is advisable to the business organization
that it should not be accepted as it will lead the company towards heavy losses in the
subsequent years.
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d) Calculation of NPV
YEAR CASH FLOWS
Discounting factor
@10% PV value
1 8000 0.9090909091 7272.73
2 10000 0.826446281 8264.46
3 5000 0.7513148009 3756.57
4 5000 0.6830134554 3415.07
Total cash
inflows 22708.83
NPV = PV value of total cash inflows – initial investment
= 22708.83-15000
= 7708.83
From the above calculation it can be seen that NPV of the project is positive
7708.83 which means that the company can accept the project as investing it in this
project will add to the value to the company in the future.
e) Calculating IRR
Internal rate of return is a measure of capital budgeting that deals with the
estimation of profitability of potential projects or investments. It is that rate of discount
which makes the net present value of all the cash inflows from a particular investment
equivalent to zero (Janssens, and et.al., 2016).
YEAR CASH FLOWS
Discounting
factor @10% PV value
-15000
1 8000 0.909 7272.73
2 10000 0.826 8264.46
3 5000 0.751 3756.57
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4 5000 0.683 3415.07
Total
cash
inflows 22708.83
IRR 34.77%
From the calculation, it can be seen that IRR is 34.77% which is that rate which
makes the present value of he project equals to 0. IRR is way higher the required rate of
return of the company which is 10%. Thus, it is advisable for the company that it should
accept the project as the investments depicts good profitability in the future.
CONCLUSION
From the above project report, it can be summarised that business decision
making is really a crucial tool that helps an organisation in paving its way towards the
success. In the report, a research was undertaken for knowing the reasons behind the
case of shifting preferences from traditional shopping to online shopping due to
technological innovations and multichannel shopping evolution. Further, it was
concluded that for efficient decision making, different information systems can be used
such as transaction processing system (TPS), MIS, or decision making system. These
technological advances have helped the organisation in better gathering and analysing
data from which more rationale decisions could be drawn out. Lastly, it was seen that
net present value and IRR are the two capital budgeting tools that evaluates the
profitability and attractiveness of an investments. These techniques tells mangers that
whether a project should be taken up or not which is crucial for the growth and success
of company as such investments include huge costs.
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REFERENCES
Books and Journals
DEMİRGÜNEŞ, A.P.D.B.K., 2016. A RESEARCH TO DETERMINE THE FACTORS
CAUSING SHOPPING HESITATION. ICWSR, p.93.
Gerbl, M., McIvor, R. and Humphreys, P., 2016. Making the business process
outsourcing decision: why distance matters. International Journal of Operations &
Production Management. 36(9). pp.1037-1064.
Hair Jr, J. F and et.al., 2015. Essentials of business research methods. Routledge.
IJdens, T. M., 2015. Entrepreneurial cognition and the decision making
process (Master's thesis, University of Twente).
Janeiro, J.H.M., 2018. HOW CAN BIG DATA AFFECT UNCERTAINTY IN STRATEGIC
DECISION-MAKING?.
Janssens, L and et.al., 2016, June. Consistent Integration of Decision (DMN) and
Process (BPMN) Models. In CAiSE Forum (Vol. 1612, pp. 121-128).
Litvaj, I. and Stancekova, D., 2015. Decision-making, and their relation to the knowledge
management, use of knowledge management in decision-making. Procedia
economics and finance. 23. pp.467-472.
Rosemann, M. and vom Brocke, J., 2015. The six core elements of business process
management. In Handbook on business process management 1 (pp. 105-122).
Springer, Berlin, Heidelberg.
Werhane, P.H., 2019. The normative/descriptive distinction in methodologies of
business ethics. In Systems Thinking and Moral Imagination (pp. 21-25). Springer,
Cham.
Weygandt, J. J and et.al.,2018. Managerial Accounting: Tools for Business Decision-
making. John Wiley & Sons Canada, Limited.
Wheelen, T. L and et.al., 2017. Strategic management and business policy (p. 55).
Boston: pearson.
Online
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Sainsbury (J) PLC. 2019.[Online] Available
through<https://www.morningstar.com/stocks/xlon/sbry/quote.html>
Transaction Processing Systems: Application & Examples. 2019. [Online] Available
through : <https://study.com/academy/lesson/transaction-processing-systems-
application-examples.html>
What are characteristics of a decision support system.2015. [Online] Available through
<http://dssresources.com/faq/index.php?action=artikel&id=13>
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