Topics: Geert Hofstede, Dimension, Decision theory Pages: 6 (2142 words) Published: February 24, 2011

Table of Context

1. Planning1
2. Organizing3
3. Leading5
4. Controlling6

1. Planning

In the case that we are studying, Don Anglos and Pinnacle have to make the decision whether Pinnacle Machine Tool Co. should acquire Hoilman Inc. or not. Don Anglos, the CEO of Pinnacle Co, Jennifer Banks, services division head and Sam Lodge, CFO, are taking the steps to make the most appropriate decision. According to many economists (Anderson et al., 2008), the steps in the decision making process are the following: 1. Identify and define the problem.

2. Determine the set of alternative solutions.
3. Determine the criteria that will be used to evaluate the alternative solutions. 4. Evaluate the alternative solutions.
5. Decide the most appropriate solution.
Taking into consideration the above steps we will analyze the case study of the Pinnacle Machine Tools Co. First of all, Don Anglos has defined the problem, which is the decrease of the company’s profits. The company had tried to gain more market share through an aggressive price policy. This attempt was successful, but the lower prices had affected the profit margins. That is exactly the problem, which Don Anglos is about to solve: the increasing of the company’s profits. Of course, in decision making process, the identification of the issue has to be more carefully analyzed. A more detailed study of the problem may emerge alternatives, which might have been ignored, otherwise. (Keeney & Howard, 1976) The solution, which Don Anglos suggests, is the acquisition of the Hoilman Inc. Such a diversifying strategic alliance, will give to the Pinnacle the opportunity to extend their business to the field of services. The disadvantage of Don Anglos’ suggestion is that it has only one alternative. A group of more than one solution, that could be evaluated and compared, would be more effective in such a case. A multi-alternative project could prevent mistakes and reverse undesirable situations. (Tonn et al., 2000) The criterion, through which Don Anglos will evaluate the alternative, is his instinct and his previous experience on acquiring. On the other hand CFO Sam Lodge has set financial criteria to assess the solution. In particular, he has studied the market development options and the market share that Pinnacle could have. The accurate setting of the criteria, on which the decision will be based, has been ignored by Don Anglos. That consist a hindrance to the transparency and stability of the final decision. (Hammond et al., 1999) Considering the latter, the evaluation of the one and only alternative could not be proper as the criteria have not been set. Despite that, Don Anglos evaluated its own solution based on the criteria of Sam Lodge and he rejected it. At the same time, if he should follow his instinct, he has to accept the alternative. Furthermore, accepting the Sam Lodge’s argument means that he has to search for another solution to suggest instead of the rejected one. (Noorderhaven, 1995) Finally, Don Anglos has concluded to follow his instinct and accept the acquirement of Hoilman Inc. He has not taken into account any rational criteria, but he has estimated the solution through his own preferences and ideas. This is not rare to many cases. CEOs prefer to bypass the evaluation process or not taking it in to consideration. The majority of the decisions have been taking with some or no influence of the estimating step. (Kornov & Thissen, 2000)

2. Organizing

Nowadays, information technology has already permeated to the organizations and its effects are obvious. Of course, digital development affects on all levels of an organization in many ways. To be more specific, internet has become an integral part of every organization in various levels, which depend on the nature of the corporation. First of all, we have to make a brief reference on the two different types of organizations that are most implicated with...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Ikea’s Management Style Essay
  • Essay about The Chinese Cultural System: Cultural Management.
  • International Management Essay
  • Cross Cultural Management Essay
  • Management Essay Offshoring
  • Analysis and Comparison of Iranian and American Management; the Cultural Dimensions and Values Research Paper
  • Tokyo Essay
  • Hierarchy and power within East and Western enterprises Research Paper

Become a StudyMode Member

Sign Up - It's Free