(Doc) Business Decision Making Assignment Solution

BUSINESS DECISION
MAKING

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Plan for collection of primary and secondary data ...............................................................1
1.2 Survey methodology and sampling frame used ...................................................................2
1.3 Questionnaire for given business problem ...........................................................................2
2.1 Creating information for decision making by summarising data using representative
values..........................................................................................................................................4
2.2 Analysing results to draw conclusions..................................................................................6
2.3 Analysing data using measures of dispersion.......................................................................7
2.4 Computation of quartiles, percentiles and correlation co-efficient for Blackfriars restaurant
.....................................................................................................................................................8
TASK 2............................................................................................................................................8
3.1 Graphs for presenting the information about sales and profit...............................................8
3.2 Trend line for forecasting of various business information................................................10
3.3 Software and techniques to disseminate information effectively......................................10
3.4 formal business report.........................................................................................................10
TASK 3..........................................................................................................................................11
4.1 Information processing tools for decision making .............................................................11
4.2 project plan for an activity and determination of critical path............................................12
4.3 Financial tools for decision making ...................................................................................14
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
Business decision making is an integral part of management which is used for making
the best decision for improving the performance and profitability of organisation. Business
decision making helps in making strategies for attracting more customers towards the firm.
Blackfriars restaurant will be included in this study as it is opening its second restaurant in
London. The Blackfriars restaurant is the oldest dining room in the UK. It provides traditional
British food using seasonal produce from local farms. This project will include variety of sources
of data collection and Analysis. Furthermore, it will provide understanding of the various
software and techniques used decision making in the organisation. Moreover, it will provide
information processing tools to prepare a project plan and identify the Main activities involved
getting the restaurant ready for the business. It will also provide the investment appraisal tools
for identifying the future profitability of the firm. This report will provide trend line in graph to
assist in forecasting for the future profitability.
TASK 1
1.1 Plan for collection of primary and secondary data
Primary data and secondary data are collected in order to identify the customer taste and
preferences and identifying their needs in order to provide them various products and services.
Primary data: primary data refers to the collection of information from first- hand data
using various methods such as surveys, interviews etc (Zsambok and Klein, 2014).
Plan for primary data collection
Blackfriars for the purpose of primary data collection will use questionnaire for
identifying the needs and demands of customers in order to provide them various facilities
according to the result provided by using questionnaire. Primary data will be collected using the
survey method in which the restaurant will collect the data about customer preferences and taste
by using questionnaire and providing that questionnaire to the customers to fill the answers
which will be used for identifying the customer preferences using the sampling method which
will include sample of 20 people.
Secondary data: It includes data collected from various studies and it does not include
the first – hand data (Barlett, 2016). It contains data which is already gathered and using the
same data for identifying the information. It includes data collected from records, government
department etc.
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Plan for secondary data collection
Secondary data will be used by Blackfriars to identify the needs and demands of
customers to solve the business problem. The researcher will collect the data from the internet,
books etc. to identify the needs and preferences of customers. Blackfriars will use the
information from the internet and using the old records to know about the customers’ demands
and their wants.
1.2 Survey methodology and sampling frame used
Survey methodology refers to process used by organisation to conduct a survey.
Blackfriars in order to conduct the survey using questionnaire which will include some questions
which will assist the organisation in identifying the needs and demands of customers and their
taste and preferences (Baker, 2018). Blackfriars after preparing the questionnaire will identify
the customer details such as their mail id, phone number etc. with the help of administrative
department which will provide the customers details. After that the questionnaire will be send to
the mail of customers to identify and get the answers from that which will helps the firm in
providing the facilities accordingly.
Sampling framework used by Blackfriars include the samples according to probability
and non- probability. Probabilistic sampling used by Blackfriars will include random sampling
from the large population. Blackfriars will provide equal chances to every individual according
to this method of sampling. Non – probabilistic sampling does not give equal chances of being
selected as sample.
1.3 Questionnaire for given business problem
Blackfriars Restaurant survey
Question 1: How often do you dine with Blackfriars restaurant survey ?
 Daily ()
 weekly ()
 monthly ()
 Once in three months ()
 first time ()
 other ()
Question 2 : Does the restaurant have sufficient selection of healthy choices
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 Yes ()
 No ()
Question 3 How would to rate the taste of our meal?
 Excellent ()
 Good ()
 Average ()
 Below average ()
 Poor ()
Question 4 : How well does our product meet your demand?
 Badly ()
 Fine ()
 Well()
 Very well ()
Question 5 : How would you rate the value for money of the product ?
 Bad ()
 Regular()
 Good ()
Question 6: Compared to our competitors, is our product quality better, worse, or about the
same?
 Better
 The same
 Worse
Question 7 : What style of restaurant would you prefer ?
 Traditional ()
 Homey ()
 Modern ()
 Mixed traditional and modern ()
 I don't have a preference ()
Question 8 : What time do you prefer to visit a restaurant ?
 Breakfast ( 6 am- 11 am) []
 Lunch ( 12 PM – 4 pm) []
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 Both meals
Question 9 : How do you prefer the food to be served ?
 Simple ()
 Crafted ()
 Flavourful ()
Question 10: Annual income range
 Below 20000 ()
 20000-30000 ()
 31000-40000 ()
 41000-50000()
 51000 and above ()
2.1 Creating information for decision making by summarising data using representative values
Theme 1: Restaurant have sufficient selection of healthy choices
Particulars Number of respondents % of respondents
Yes 25 83.00%
No 5 17.00%
Total 30 100.00%
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According to the survey conducted it has been identified by Blackfriars that most of the
customers chosen that the restaurant provides healthy food products which are beneficial for
them. Also, the restaurant has wide variety of the healthy choices for customers.
Theme 2 : Rating for the taste of meal
Particulars Number of respondents % of respondents
Excellent 25 50.00%
Good 10 20.00%
average 6 12.00%
Below average 5 10.00%
poor 4 8.00%
Total 50 100.00%
According to the survey conducted by Blackfriars restaurant it is identified that most of
the customer provided positive result towards the meals provided by the restaurant.
5
Yes No
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9 83.00%
17.00%
% of respondents

2.2 Analysing results to draw conclusions
Data of Blackfriars restaurant for the period of 10 years are enumerated below:
Year
Sales
(in £)
Profit
(in £)
2009 1200 300
2010 1280 340
2011 1320 375
2012 1360 410
2013 1310 385
2014 1290 360
2015 1380 420
2016 1460 470
2017 1610 530
2018 1690 590
Descriptive statistics:
It consists of mean, median, mode, range , minimum and maximum.
 Mean shows the average of the values provided in the data.
 Median show the mid value in the series of data.
 Range shows the different between the largest and smallest value.
 Minimum value is the smallest value in the series of data.
 Maximum value is the largest value present in the data.
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Excellent Good averageBelow average poor
0
0.1
0.2
0.3
0.4
0.5
0.6
50.00%
20.00%
12.00% 10.00% 8.00%
% of respondents

Particulars
Sales
(in £)
Profit
(in £)
Mean 1390 418
Median 1340 397.5
Mode #N/A #N/A
Range 490 290
Minimum 1200 300
Maximum 1690 590
From the above computation it can be interpreted that mean determined by the series of
sales provided the result 1390 and the mean for profit value is 418. Median computed above
shows that the mid value in the sales data is 140 and in profit is 397.5. Range shows that the
difference between the largest and smallest value in the sales data which provided 490 as result.
Al;so, range for the profit is 290. Minimum value in sales data is 1200 and maximum value in
sales data is 1690. Furthermore, minimum value of profit is 300 and maximum value is 590.
2.3 Analysing data using measures of dispersion
Measures of dispersion: It includes the factors that provide information about the
variation that affect the business performance (Ferrell and Fraedrich, 2015). Measures of
dispersion includes standard deviation, standard error, Kurtosis and skewness.
Particulars
Sales
(in £)
Profit
(in £)
Standard Error 48.74 28.13
Standard
Deviation 154.13 88.95
Sample Variance 23755.6 7912.22
Kurtosis 0.33 0.15
Skewness 1.059 0.83
From the above computation it can be interpreted that standard error in sales is 48.74 and
in profit is 28.13. Also, the standard deviation computed above provided that the deviation in
sales accounted for 154.13 and in profit it accounted for 88.95. Also, sample variance provided
variation in sales equals to 23755.6 and in profit 7912.22. Kurtosis provided the outcome for
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variation in sales as 0.33 and in profit as 0.15. Skewness provided that sales variation equals to
1.059 and profit variation equal to 0.83.
2.4 Computation of quartiles, percentiles and correlation co-efficient for Blackfriars restaurant
Computation of quartile and percentile
Particulars Sales Profit
Quartile 1 and
25th percentile 1295 363.75
Quartile 2 and
50th percentile 1340 397.5
Quartile 3 and
75th percentile 1440 457.5
From the above computation it can be interpreted about the 1st, 2nd and 3rd quartile n
which shows that over the years the quartile for sales is increasing which is beneficial for the
firm. The first quartile in sales provide result 1295 which is the 25% of the sales data collected
above. 2nd quartile provide 50 %b of the result which shows the median of the data provided. 3rd
quartile shows the 75% of the sales data which resulted into 1440.Also, it can be interpreted that
quartile computed for the data relating to profit shows that is increasing in every quartile which
is beneficial for the organisation.
Computation of quartile and correlation co-efficient
Particulars Sales Profit
Sales 1 0.99
Profit 0.99 1
It shows the correlation between the sales and profit. It can be interpreted that correlation
is measured in ratio to 1. Correlation of sales with profit shows that profit in relation to sales is
0.99 sales in relation to profit accounted as 0.99.
TASK 2
3.1 Graphs for presenting the information about sales and profit
Sales and profit figure of Blackfriars restaurant from 2009 to 2018 is as follows:
Year
Sales
(in £)
Profit
(in £)
2009 1200 300
2010 1280 340
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2011 1320 375
2012 1360 410
2013 1310 385
2014 1290 360
2015 1380 420
2016 1460 470
2017 1610 530
2018 1690 590
Graphical representation: The below graph is showing the sales and profit of Blackfriars
for the period of 10 years starting from 2009 to 2018. The sales of Blackfriars for this period
includes 1200 ,1280, 1320, 1360, 1310, 1290, 1380, 1460, 1610 and 1690 which shows that the
sales of Blackfriars is increased over the years except in the year 2014 which shows that sales
goes down to 1290 from 1310. The profits generated in this period consist of 300, 340, 375, 410,
385, 360, 420, 470, 530 and 590.
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3.2 Trend line for forecasting of various business information
Trend line : It is used to identify the trend which is following in the organisation on the
basis of variables present in the graphs. It helps in determining the trend which is existing in the
organisation. The above trend line shows the trend of sales and profit for the period of 10 years
of Blackfriars organisation (Trend Lines, 2017). From the below trend line it can be interpreted
that sales is growing over the period of times and also the profitability of the firm is increasing
over the years which shows that company is performing well in the industry.
3.3 Software and techniques to disseminate information effectively
Enclosed in power point presentation.
3.4 formal business report
To Owner of Blackfriars restaurant
Date 14/12/2018
Subject : Recommendations regarding opening of new restaurant In London
Introduction
This report is prepared for providing in formation to the owner of Blackfriars restaurant
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which is going to open a new restaurant in London. This report will provide information about
the future profitability and performance of Blackfriars if it open the restaurant at that place.
Findings
It has been identified that the trend of sales and profit is increasing over the years which
provide that if the owner open the restaurant at London it will be profitable for them. This
report is provided to the owner in order to suggest that the restaurant will be gain profits if it is
open in London as this restaurant provide various kinds of food products and healthy dishes
which will attract more customers. The researcher collected the data from primary and
secondary sources to identify the taste and preferences of customers. The survey provided the
positive result and thus it will be beneficial for the Blackfriars to open the new restaurant in
London.
TASK 3
4.1 Information processing tools for decision making
The information processing tools helps the firm in making effective decision for the
organisation (What is MIS? Introduction & Definition, 2016). These tools assist in choosing the
best solution for the problem which helps in future improvement of business. These tools consist
of :
Decision support system: This system is used in the organisation which helps in
supporting decision- making. It is a computerized information system that can be used by
organisation for various purposes of decision – making. It collects, organize and analyse the
business data for effective decision making for management, operation and planning. An
effective decision – support system assist decision – makers in compiling various data from
many sources such as raw data, documents, personal knowledge from employees, management
etc (MAKING, 2015). This system aids in providing effective solution to various [problems
which leads to effective decision – making for the firm. Decision – support system includes
information such as: projected revenue and sales, comparative sales figures pertaining to
different periods etc. This system helps in dealing with various problems with rapidly changing
variables. This system is used by management for understanding the large amount of data.
Transaction processing system: This system is implemented in the organisation to
process the information about the various transactions that helps in decision making. Transaction
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processing system helps in tracking the information about every transaction that take place in the
firm (Sharma, Mithas and Kankanhalli, 2014). This system records the data of every operation
from the various department of the organisation. It assists in day to day operations of the firm.
The transaction is the representation of the activity. Transaction processing system generates two
types of result that includes sending message back to operator generator. Also, it generates the
printed material. It helps in improving the operations of the organisation which assist in
improving the performance. Using TPS systems for tracking the transaction assist in identifying
the problems which are affecting the performance of business and management can track the sale
record and profitability of the firm. Transaction processing system include systems such as point
of sale which is used to record the daily sales.
Management information system: It is the use of information technology that assist the
management inn recording and storing the data which helps them in making day to day decision.
It is a collection of system and software that work together to process, store and produce
information which will be beneficial for the organisation. It produces report on daily basis about
the various operations for every level of management (Bennun and et.al., 2018). The main
purpose of MIS is to provide feedback to the management about their performance in order to
improve their performance for increasing the future profitability of firm. The major components
of management information system are people, data, business procedures, hardware and
software. This system helps in facilitating within and outside the organisation. It helps in
communicating with the customers.
4.2 project plan for an activity and determination of critical path
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Task Name Duration
1
Conducting primary investigation in UK
to assess the viability of new restaurant
development
10 days
2 Set location for new project 5 days
3 Collecting primary data 9 days
4 Secondary investigation 8 days
5 Analysis of data to identify resource
requirement 11 days
6 Documentation 5 days
7 Recruiting human forces 6 days
8 Starting a new restaurant in London 12 days
9 Analysis of business performance 7 days
10 Make effective decision to solve issue 3 days
11 Changes implemented 2 days
Gantt chart
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Network diagram
Particulars Critical paths Critical duration
1 4 + 5 + 6 + 9 + 10 + 11 36
2 4 + 5 + 6 + 9 + 11 22
The critical path as shown above includes 4,5,6,9 and 11 and another path includes
4,5,6,9 and 11. These paths are important for completing the project without these paths the
project cannot be completed. The critical duration in path is 36 and 22 which shows that the
project if followed according to the paths will be completed in that specific duration. Also, it can
be identified that path 4,5,6,9 and 11 consist less duration as compared to the critical path of
4,5,6,9,10 and 11.
4.3 Financial tools for decision making
Net present value : NPV is used for identifying the present value which will be generated
from the investment. It helps the organisation in identifying the returns that will be generated
from investing in that project (Gong and et.al., 2018). This method is used to calculate the
present value of investments on the basis of cash flows for the period. NPV is calculated by
subtracting the initial investment from total discounted cash inflows.
Year
Cash
flows
(in £)
PV
factor
@12%
PV of
cash
flows
(in £)
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1 50000 0.893
44642.
9
2 64000 0.797
51020.
4
3 58000 0.712
41283.
3
4 70000 0.636
44486.
3
Total discounted
cash inflows 181433
Less: initial
investment 190000
NPV -8567.2
From the above computation it can be interpreted that the cash flows for the year 1, 2, 3
and 4 are provided which included 50000, 64000, 58000 and 70000 as cash inflows. As
company requires 12 % return on the investment which provided with PV factors @ 12% for the
years 1 to 4. On the basis of Present value factor and cash inflows the Present value of cash flows
is determined. The computation provided above provide understanding that the total discounted
cash flows are 181433. The initial investment made by the Blackfriars restaurant was 190000.
So the net present value computed is -8567.2 which shows that if the company opened the
restaurant at that place it will be a poor decision as it will generate loss for the firm. So it is
recommended to use other investment appraisal techniques as the result provided by this method
shows it is not beneficial for Blackfriars to invest in that project.
Internal rate of return : it is the interest rate at which the net present value ODF all the
cash floes are equal to zero. It is the discount rate that make the NPV of a project to zero. The
rate computed by this method provide the expected rate of return by investing the money in that
project.
Year
Cash
flows
(in £)
0 -
15

19000
0
1 50000
2 64000
3 58000
4 70000
Internal
rate of
return 10%
From the above computation it can be interpreted about the internal rate of return which
is used by Blackfriars to identify the return by investing the money in opening a new restaurant
at London (Pettigrew, 2014). It can be interpreted that the internal rate of return is lower than the
minimum required rate of return set by the organisation. It shows that the organisation will not
receive the higher returns by investing the money in that project and will suffer from loss. So,
it is recommended that the firm must use other appraisal technique to determine the return which
will be generated from investing in that project.
CONCLUSION
From the above study it has been concluded about business decision making which
involves taking decision for the improving the performance of the organisation. This assignment
has provided plan for collection of primary and secondary data. Furthermore, it has included
information about descriptive statistics which has included mean , median , mode , range etc.
Moreover, it has provided with survey methodology and sample framing which has been used by
Blackfriars for preparing the survey. Also, it has included various investment appraisal methods
which has been used by Blackfriars for determining the future profitability of restaurant. This
study has also provided with information processing tools for decision making which has
included decision- support system, transaction processing system and MIS.
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REFERENCES
Books and Journals
Baker, A.J., 2018. Business decision making. Routledge.
Barlett, P.F. ed., 2016. Agricultural decision making: Anthropological contributions to rural
development. Academic Press.
Bennun, L. and et.al., 2018. The Value of the IUCN Red List for Business Decision‐
Making. Conservation Letters. 11(1). p.e12353.
Ferrell, O.C. and Fraedrich, J., 2015. Business ethics: Ethical decision making & cases. Nelson
Education.
Gong, M. and et.al., 2018. Inside out: The interrelationships of sustainable performance metrics
and its effect on business decision making: Theory and practice. Resources, Conservation
and Recycling. 128. pp.155-166.
MAKING, S.O.D., 2015. Leaders as decision architects. Harvard Business Review.
Pettigrew, A.M., 2014. The politics of organizational decision-making. Routledge.
Sharma, R., Mithas, S. and Kankanhalli, A., 2014. Transforming decision-making processes: a
research agenda for understanding the impact of business analytics on organisations.
Zsambok, C.E. and Klein, G. eds., 2014. Naturalistic decision making. Psychology Press.
ONLINE
What is MIS? Introduction & Definition. 2016. [Online]. Available through
:<https://www.guru99.com/mis-definition.html>
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