Business Decision Making Report - Blackfriars Restaurant Case Study

This report provides a comprehensive analysis of business decision-making, focusing on a case study involving Blackfriars Restaurant's potential expansion. It begins with an introduction to the decision-making process and its importance in business. The report then details the creation of a plan for collecting both primary and secondary data, including survey methodology, sampling frames, and questionnaire design. Data analysis techniques are explored, including summarization using representative values, drawing valid conclusions, and employing measures of dispersion. The report presents findings on sales and profit trends, along with statistical analyses such as mean, median, and mode calculations. Furthermore, the report includes the use of tables, graphs, and trend lines to present data effectively. It also addresses the use of information processing and financial tools for decision-making. Overall, the report aims to provide actionable insights to support informed business decisions, particularly regarding the viability of expanding the Blackfriars Restaurant chain.

Business Decision Making
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Table of Contents
INTRODUCTION................................................................................................................................3
TASK 1.................................................................................................................................................3
AC 1.1 Creating a plan for the collection of primary and secondary data for Blackfriars
Restaurant........................................................................................................................................3
AC 1.2 Survey methodology and sampling frame...........................................................................4
AC 1.3 Questionnaire......................................................................................................................4
AC 2.1 Summarizing of information for decision making..............................................................6
AC 2.2 Analysis of results to draw valid conclusion.......................................................................7
AC 2.3 Analysis of data using measuring dispersion......................................................................8
2.4 Quartile, percentile and correlation coefficient.........................................................................8
TASK 2.................................................................................................................................................9
AC 3.3 Preparing a business presentation.......................................................................................9
AC 3.4 Preparing formal business report to disseminate information effectively...........................9
AC 3.1 Graphs with valid conclusion............................................................................................10
AC 3.2 Trend lines.........................................................................................................................11
AC 4.1 Information processing tools.............................................................................................12
AC 4.2 Project Plan.......................................................................................................................13
AC 4.3 Financial tools for decision making..................................................................................14
CONCLUSION..................................................................................................................................15
REFERENCES...................................................................................................................................16
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INTRODUCTION
Decision making is an essential and widen part of business world. From lower level to
higher level staff members, all are taking decisions to run the business in the right manner on day to
day basis (Arnicans, 2012). It is a process of selection of best course of actions from the available
alternatives. On every day basis, companies are facing several issues and to deal with them,
responsible persons determine the various solutions. In this situation of resolve the problem, it
becomes important for the firm to chosen right action from the list of alternatives. The present
research is based on business decision making and to understand its importance, Blackfriars
Restaurant case study is taking into the consideration (Banerjee, 2008). As per the given case
scenario, organization is planning to open its second restaurant chain in London. In this context, to
make sure about security and feasibility of investment, the stakeholders want to know that this
move of firm is viable or not. Along with this, board of directors of cited organization needs to
understand the preferences of the customers in terms of costs, taste and location inclination basis.
Objectives that will cover under the current study are use of variety of sources for the collection of
data, both primary and secondary, range of techniques to analyse data effectively for business
purposes and produce information in appropriate formats for decision making in organisational
context (Day, 2005). Along with this, this research will explain the use software-generated
information to make decisions in Blackfriars Restaurant.
TASK 1
AC 1.1 Creating a plan for the collection of primary and secondary data for Blackfriars Restaurant
Data collection is the process of gathering and evaluating information which enables to find
the answers of research questions in a right manner. The collected data from this method uses to
develop an understanding of subject and predict future events. There are two types of data
collection: primary and secondary (Greasley, 2004). In primary data collection, data may assemble
either from observation or direct communication with respondents. From observation, investigator
observes respondents without asking them any question. It is free from subjective biasness and
respondents’ willingness. On the other hand, secondary data collection method, the researcher
obtain data from different secondary sources such as publication of government, public records,
technical and trade journals, statistical or historical documents, businesses reports etc (Jankowicz,
2004).
As per the given case study, it has found that Blackfriars Restaurant is a restaurant chain.
Organization has planned to open its second restaurant in London. In this context, to ensure that this
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is a viable move of the company, the shareholders have needed to understand the market. Therefore,
it has required carrying out a planned data collection and data analysis so that board of directors of
Blackfriars Restaurant understand the customer preferences in terms of prices, taste and location
preferences (Kerzner, 2012). To collect the data for the following aim, primary and secondary data
collection methods will be used. In primary, a structured questionnaire will prepare that will base on
determine and understand the consumer preferences in various ways. While, in secondary data
collection, the data will gather from Blackfriars Restaurant records, its customer reviews, market
demand and trend etc. Therefore, from the above stated data collection plan, board of directors of
Blackfriars Restaurant can understand the preferences of its customers in a right way (Leach, 2011).
AC 1.2 Survey methodology and sampling frame
Survey is a method of sociological investigation which utilizes to collect the information via
questionnaire or statistical based methods. It helps in determine how people act and think on a
particular situation (Smit and Trigeorgis, 2011). The aim of survey research is focussing over the
interest of the population on a specific topic. In this context, survey methodology uses to study the
sampling of individual units that selects from a population and the relevant data collection
techniques. With the help of this, it becomes easy for the researcher to get the answers of questions.
For this, a structured questionnaire will prepare that will contain both open and close ended
questions. It will include the questions related to the customer preferences such as taste, selection,
prices etc so that it will easy for the cited restaurant to understand the service users perception and
take decision whether restaurant should be open in London or not (Carmichael, 2011).
Sampling frame:
In terms of statistics, sample frame can be defined as the source of material by which a
sample draws for the investigation. It contains the lost of population to select the sample units for
the investigation. By considering the case study of Blackfriars Restaurant in order to carry out data
collection plan, a sample frame will select. For this, random sampling method will to collect
primary data from the citizens of London. The sample unit that will represent the whole population
is 40 respondents (Little, 2010).
AC 1.3 Questionnaire
Demographic information
Name: ________________
Age: ______________
Gender: ___________________
Occupation: ___________________
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1. How frequently you are using the services of Blackfriars Restaurant?
 Once in a week
 Once in a month
 Once in 6 months
 Once in a year
2. Form how long you are using services of Blackfriars Restaurant?
 0-1
 1-3
 3-5
 More then 5
3. From which information sources, you get the information about services of Blackfriars
Restaurant?
 Newspapers and magazines
 Friends
 At the stores
 Social media
 Internet advertisements
4. According to you, which factor influence you to visit Blackfriars Restaurant?
 Prices
 Quality
 Speed of servicing
 Availability of wide range of food products
 Previous experience
 New trials
5. Rate your satisfaction level in terms of quality of Blackfriars Restaurant services.
 Highly satisfied
 Satisfied
 Neutral
 Dissatisfied
 Highly dissatisfied
6. Rate your satisfaction level in terms of prices of Blackfriars Restaurant services.
 Highly satisfied
 Satisfied
 Neutral
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 Dissatisfied
 Highly dissatisfied
7. Is Blackfriars Restaurant intimate you various special services and offers on regular basis?
 Yes, always inform
 No, not intimate
 Sometimes
8. Do you have any information about Blackfriars Restaurant is planning to open its second
restaurant chain.
 Yes
 No
9. According to you which place should be more appropriate for Blackfriars Restaurant to open its
second chain.
 Aberdeen
 Norwich
 Peterborough
 London
 Oxford
10. Please suggest your views by which Blackfriars Restaurant can improve it services in effective
manner.
________________________________________________________________________________
Justification for designing of the questionnaire
To determine the customer preferences in order to take right decision regarding open a
second restaurant chain in London, Blackfriars Restaurant will develop a questionnaire. The reason
of adopting the following approach by the company is to clearly understand the perception of
consumers in terms of prices, quality, needs, expectations etc (Nicholson and Aman, 2012).
AC 2.1 Summarizing of information for decision making
For an organization, decision making becomes an essential concern to run the business in the
right direction and take effective decisions for business activities. Companies have used several
tools and techniques to carry out business decision making process. Blackfriars Restaurant has
planned to open its next second restaurant chain in London (Prieto and Revilla, 2006). To fetching
judgement in this respect, past records of cited organization will be taking into the consideration.
From financial statements, last six years sales and profit values will collect and analyzed which is as
follows:
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Gathered information
Year Sales (in £ million ) Profit (in £ million)
2010 550 55
2011 670 68
2012 700 76
2013 750 105
2014 820 129
2015 930 142
On the basis of the above table of sales and profit of Blackfriars Restaurant, it has been
determined that sales of existing restaurant have increased in last past 6 years. On the same, profit
level of cited organization has also grown with the time with respect to sales values. From this
information, it can be concluded that restaurant has attained the excellent growth in last 6 years and
this thing has given strength to the business in the market place of the UK in terms of financial
position (Schraeder and Morrison, 2005). So, it can be said from this analysis that Blackfriars
Restaurant has to open its new second chain restaurant in London.
AC 2.2 Analysis of results to draw valid conclusion
As per the collected sales and profits data of Blackfriars Restaurant, it has been identified
that company has increased its sales and profit level with the time. It has leaded the business at the
strong financial position in the UK food market. Due to this, management can take decision to open
a second chain in London (Van, Kurth-Nelson and Redish, 2012). But before reaching to a valid
conclusion, it has essential to find the values of mode, mean and median by considering past six
year profit and sales values which are as follows:
Sales £m Profit £m
Mean 736.6667 Mean 95.83333
Standard Error 53.2708 Standard Error 14.31879
Median 725 Median 90.5
Mode #N/A Mode #N/A
Standard Deviation 130.4863 Standard Deviation 35.07373
Sample Variance 17026.67 Sample Variance 1230.167
Kurtosis 0.22357 Kurtosis -1.95058
Skewness 0.129298 Skewness 0.265637
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Range 380 Range 87
Minimum 550 Minimum 55
Maximum 930 Maximum 142
Sum 4420 Sum 575
Count 6 Count 6
The above stated calculation values of sales and profit of Blackfriars Restaurant, different
assessment in terms of mean median and mode has calculated. Value of mean for sales has
£736.6667m and profit has £ 95.83333m. While, median of sales has £725m and profit has £90.5m.
Further from the calculation, it has been found value of mode has zero for both profit and sales
because there have not repetitive sales and profit data.
AC 2.3 Analysis of data using measuring dispersion
To define the level of variability of given data, measures of dispersion method takes into the
consideration. It finds out by considering three ways: range, inter-quartile range and standard
deviation (Measures of Central Tendency and Dispersion, 2013). Range considers as a simple and
most common method to evaluate dispersion. It is a difference between largest and smallest values
of given data set. On the other hand, inter-quartile range computes by difference between 1st and 3rd
quartile. While, standard deviation is the most common method to determine range of dispersion
(Cumulative Frequency, Quartiles and Percentiles, 2014). In the context of Blackfriars Restaurant,
analysis of profit and sales data using measuring dispersion is as follows:
Sales £m Profit £m
Standard Deviation 130.4863 Standard Deviation 35.07373
Range 380 Range 87
2.4 Quartile, percentile and correlation coefficient
Percentile and quartile
Percentile is an evaluation at which that percentage of the total values are the below or same
that measure. Quartile uses to divide the data into four groups and it contains approximate equal
number of observations (Measures of Dispersion, 2013). For Blackfriars Restaurant, calculation of
percentile and quartile for sales and profit data is showing in below table.
Percentile and quartile Sales in £m Profit in £m
Quartile 1 677.5 70
Quartile 2 725 90.5
Quartile 3 802.5 123
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25th Percentile 677.5 70
50th Percentile 725 90.5
75th Percentile 802.5 123
As per the above calculation, it has determined that values of quartile 1 and 25th percentile in
both sales and profit has equal i.e. £677.5m and £70m. While quartile 2 and 50th percentile
computed terms for both profit and sales in the context of Blackfriars Restaurant has same i.e.
£725m and £90.5m. Further, calculated value defines that 3rd quartile and 75th percentile of sales and
profit of cited organization has £802.5m and £123m. On the basis of the above findings, Blackfriars
Restaurant will able to take investment and other business related decisions for new project.
Correlation coefficient
To measure degree of change and impact of one factor over other, correlation coefficient
method use by the organization. In positive correlation, by increase value of one element bring the
increment in other variable. On the other hand, when value of factor decrease then it makes the
same impact on other element and this is called negative correlation coefficient (Ord, 2011). In the
context of Blackfriars Restaurant, correlation between sales and profit values is as follows:
Sales £m Profit £m
Sales £m 1
Profit £m 0.962132 1
By consider the calculation of above table, it has found that there is a strong relationship
between sales and profit. Any changes in sales or profit value will bring the deviation in sales or
profit value. So, at the time of taking business decision, Blackfriars Restaurant should consider
variations in sales and profit.
TASK 2
AC 3.3 Preparing a business presentation
Attached in PPT
AC 3.4 Preparing formal business report to disseminate information effectively
To
The Board of Directors,
Blackfriars Restaurant
Sir,
It is very well known that Blackfriars Restaurant is planning to open it second chain in
London. In this context, it has instructed by top management to carry out a survey before opening a
new outlet. The reason of the following investigation is to ensure to the stakeholders that this move
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of the company is viable and understand the market trends in the food restaurant industry. Along
with this, another reason of this is to understand the customer preferences including price, taste, and
location preferences. On this, a formal brief business report is as follows:
Introduction: The aim of the study is help Blackfriars Restaurant in its business decision
making process. Company is planning to open its second restaurant chain in London. This research
will define financial and market position of cited firm with the application of various tools.
Methods: In order to determine the customer preferences in a right manner, primary and
secondary data collection methods have been used. A structured questionnaire has prepared which
has included both open and closed ended questions. Further, Blackfriars Restaurant past records
have been taken into the consideration to judge consumer preferences and perceptions towards the
brand. On the other hand, random sampling has selected where sample unit has 40 respondents.
Along with this, previous 6 years sales and profit data has consider to find the financial position of
cited organization in order to know whether business is financially strong or not to open a new
chain in London.
Findings: The outcome of the study has shown that Blackfriars Restaurant has financially
strong to open its second chain in London. The profit and sales level of the organization has
increased over the time. Along with this, primary collected data has stated that customers have
satisfied with the services of Blackfriars Restaurant. They have got the information about new
offers and other things from different sources such as newspapers, mails etc. Hence, there is a good
opportunity for company to open second chain of restaurant in London.
Conclusion: From the above discussion, it has been concluded that Blackfriars Restaurant
has focused on its profit and sales level and has tried to maintain it with the time. A good financial
position of company has helped in open a new outlet in London and has attracted huge customers.
AC 3.1 Graphs with valid conclusion
Column bar graph of sales and profits data of restaurant:
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Line chart:
From the above charts, it has analyzed that Blackfriars Restaurant profit and sales has
increased with the time. The Column graph has represented that last 6 yeast data of both sales and
profit. On the other hand, line graph has also showed that from last 6 years, sales and profit of the
organization has increased over the time. This information has helped out Blackfriars Restaurant to
take right business decisions in the favour of business.
AC 3.2 Trend lines
Trend line uses to represents characteristics or behaviour of set of data in a systematic way.
This is an analytical tool that states the relationship between two or more elements. The aim of this
method is explain the trends between the data in the positive or negative way. It is also utilized in
predicting future trends for specific elements (Pruim, 2011).
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The above trend line of Blackfriars Restaurant has stated that in the near future, the sales and
profit of the organization will increase. The figure has clearly defined that company will perform
well in future in the context of profit and sales. Therefore, from the trend line graph, Blackfriars
Restaurant will able to take right business decisions regarding whether to invest the funds in
opening second chain in London or not.
AC 4.1 Information processing tools
In the hospitality sector, information technology plays an important role. With the help of
this, it enables the management to process the data into the valuable information so that a right
business decision can be taken. It helps in transform available information in various modes. There
are several Information Processing Tools that are presently following by many hospitality
organizations. These are Management Information System (MIS), Stock Control System (SCS) and
Material Requirements Planning (MRP) (Understanding operations management, 2013.). MIS
system use to converts set of data in the form of information which can be used by employees of
Blackfriars Restaurant at different organizational level for diverse purpose. It helps in establishing a
communication channel between department and share the information in several formats within the
less time. On the other hand, SCS can use by Blackfriars Restaurant to keep control and monitor the
stock level of inventory time to time (Smith, Bruyns and Evans, 2011). It helps in maintain the
records of consumption of the goods in various business operations. The information generated
from this assists the management to find the volume of goods to maintain the level of inventory. By
doing this, organization will able to meet the necessary demand of the market in an effective
manner and will provide the good satisfaction level to the customers. While, MRP will aid
Blackfriars Restaurant to forecast the needs of the inventory in the upcoming future. The
information gain from the following system will find out EOQ for very products. Therefore,
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numerous information process tools will help Blackfriars Restaurant to take different business
decision (Altman and Fleur, 2001).
AC 4.2 Project Plan
Project plan is relating to documentation of activities that helps an organization to make the
work more effective. It allows completing plan within the limited resources. In the case of
Blackfriars Restaurant, a project plan will prepare for open a new second restaurant in London. It
will contain various tasks and they will schedule against the specific time frames (Andersen, Dysvik
and Vaagaasar, 2009). The project plan for opening second restaurant chain at new location in the
UK is as follows:
S. no. Task Name Duration Start Finish Predecessors
1 Market feasibility 3 wks Fri 12/9/16 Thu 12/29/16
2 Collection of data 2 wks Fri 12/30/16 Thu 1/12/17 1
3 Evaluation of collected
data 1 wk Fri 1/13/17 Thu 1/19/17 2
4 Preparing plan 1 wk Fri 1/20/17 Thu 1/26/17 3,1
5 Resource allocation 2 wks Fri 1/27/17 Thu 2/9/17 4
6 Formulation of team 2 wks Fri 1/27/17 Thu 2/9/17 4
7 Allocation of roles and
responsibilities 1 wk Fri 2/10/17 Thu 2/16/17 6
8 Implementation of plan 5 wks Fri 2/17/17 Thu 3/23/17 5,7
9 Monitoring and controlling 2 wks Fri 3/24/17 Thu 4/6/17 8
10 Taking corrective actions 3 wks Fri 4/7/17 Thu 4/27/17 9
11 Project closure 1 wk Fri 4/28/17 Thu 5/4/17 10
Gantt chart:
Network Diagram:
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Critical Path
Critical path defines starting and ending point of different activities of a project plan. It is
not compulsory that every plan contain only a single critical path. It can be possible that there are
more than two critical paths. In this context of Blackfriars Restaurant, critical path is as follows:
1 → 2 → 3 → 4 → 6 → 7 → 8 → 9 → 10 → 11= 21 weeks
AC 4.3 Financial tools for decision making
To determine the return on investment, estimation of sales and profits in near future, forecast
the requirements of working capital for new project etc, these all can only be done with the help of
financial tools. These all have helped an organization to carry out various business decision making
processes. Some financial tools are Discounted Cash Flow (DCF), Net Present Value (NPV) and
Internal Rate of Return (IRR) (Beynon-Davies, 2009). By considering the given case of Blackfriars
Restaurant in which organization is planning to open a second chain in London, calculation of
discounted cash flow of NPV and IRR to evaluate the financial viability of the proposed
recommendations are as follows:
Net Present Value
Years Cash Inflow in £ Present value of 12 % Discounted Cash Inflow @ 12 % in £
1 50000 0.8928 44640
2 64000 0.7971 51014.4
3 58000 0.7117 41278.6
4 70000 0.6355 44485
Total Discounted Cash inflow 181418
Less: Initial Investments 190000
Net Present value in £ -8582
Year Cash flow
Initial investment -190000
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1 50000
2 64000
3 58000
4 70000
IRR 10%
As per the above calculation of NPV, it has determined that Blackfriars Restaurant has
adopted DCF method to take investment decision. On the basis of this, it can be said that company
should not invest on open second chain restaurant in London because NPV value has negative.
Along with this, IRR has small than the internal rate of returns. So, Blackfriars Restaurant should
not invest finance in the following project.
CONCLUSION
From the above study, it can be concluded that decision making process has a very important
element of organizations which has helped in taking business decisions. It has created a supportive
environment for the managers to take right decisions. Blackfriars Restaurant has planned to open its
second restaurant in the London. The reason of this is it is most exciting and dynamic cities in the
world and combined with commerce and culture, and a business friendly city. In order to ensure the
move of business expansion, the shareholders have required understanding the market. Along with
this, a planned data collection and data analysis has carried out to help the board of directors in
understanding the customer preferences including price, taste, and location preferences. From the
primary data, it has found that customers have satisfied with the services of Blackfriars Restaurant.
They have gain information about the firm from different sources such as newspapers, mails, social
media. Customers have looked towards several factors at the time of selection of restaurant. On the
other hand, secondary sources of data have stated that sales and profit of Blackfriars Restaurant has
increased with the time. It has supported the financial situation of the company and helped in
business expansion. Apart from this, from the calculation of NPV and IRR, it has been determined
the value of NPV has negative and IRR has lowered than rate of return. So, Blackfriars Restaurant
has not taken the decision to invest the funds in this project.
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