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Financial Decision Making
The cliche "you get what you measure" refers to the way the choice of what to measure and how to measure it will impact on perceptions and actions. It is important that the correct measures are chosen that are aligned with the end goal; choosing wrong measure can give misleading information that may not provide the data needed and it may obscure the information that is needed for goals to be archived.
For example, if a firm is to be judged as a potential investment based on profitability, one may use profit margin or actual monetary profit level. If two firms have two different EBT margins, one at 2% and one at 15%, an investor may believe that the firm giving a 15% return is a better investment. However, if that firm is small and only has a low turnover a5% may be a very low turnover, and the 2% return of a larger firm may be a much higher numerical return. This is a case where an investor may get what they measure, and 2% of a large profit will be more than a 15% of a very low profit amount.
Another good example of this cliche may be observed in the way executive pay has developed. Shareholders rely on CEO's to run the companies they own and act in their interests. Stockowners will often measure success in the...
This has lead to stockholders having CEO's who focus on stock value and short-term returns, often at the cost of the long-term results.
One workplace example may be the desire to increase customer service, in a firm where there were complaints about the time it took to be served. The employer started to time the employees serving speed, and as they timed and gave results the speeds increased, however, the service levels declined and customers became more dissatisfied as the employees were rushing and making mistakes in order to work faster. A clear case of the employer getting what they measure, and while they achieved the initial goal, the weakness was in the lack of consideration given to the way that the target would be achieved.
Question 2
Part A
Airlines and hotels use dynamic pricing in order to sell their services, offering deeper discounts on some third party sites such as Hotwire and Priceline. These service providers are likely to offer the deep discounts if they believe they are needed in order to maximize…
Question 3
Part A
The apparent profitability of a department will dependent on the way their costs and revenues are accounted for. In firms where there are several departments there will be overhead costs associated with resources which are used by all departments (Burns, Quinn, Warren, & Oliveira, 2013). For example, marketing may be undertaken for the firm as a whole, the HR and finance department may deal with all staff for all departments and if different divisions all share the same locations, there will be costs for the utilities and the maintenance which need to be shared out (Burns et al., 2013). The way these are shared out between the divisions will not impact on the bottom line for the firm as a whole, but it may impact on the apparent profitability of the different
Team Decision Making -- Pitfalls and Solutions Anyone who has ever been a member of any type of team can likely readily testify concerning the difficulties involved in reaching a consensus on even minor and straightforward issues such as seating arrangements, so it will likely come as no surprise to modern practitioners that the team decision-making process is fraught with a wide array of pitfalls, some of which can cause a
Marketing Plan for Glisten & Shine Glisten & Shine is jewelry and accessories-based company and shall be providing a variety of jewelry items such as necklaces, earrings, rings made from special customized gems, and later on would be diversifying its product line into bracelets, cufflinks, tie-pins, jewelry hair-pins and hair accessories, belts etc. G&S's jewelry will be special as the customer will be able to re-use it over and over again and
Founded in 1866 with the main campus housed in Grand Rapids, Michigan and 14 campuses located all throughout Michigan, Davenport University offers both graduate and undergraduate degrees with a distance learning option focusing on innovative, practical and affordable education (usnews.com). Davenport University is the only Michigan-based private university specializing in business, technology and health professions serving approximately 12,400 students. Davenport University "prepares individuals and organizations to excel in the
Differentiated Instruction and Closing the Achievement Gap It is not always easy to see how differentiated instruction is able to initiate an advantage in schools that are performing extremely low or how it could help in closing the achievement gap. On the other hand, research done by experts show something different. Research has been taking a look at schools that have been on the AYP list and achieving results that are
long-term success in your specific area of interest. How have your previous experiences prepared you for this professional career? What areas of specialization within the Carroll School of Management do you believe will be most valuable in achieving your goals? What specific short-term career objectives have you set to assist you in achieving your long-term career plans? I will never feel successful if success means putting up my feet and
" According to Short, Williams, and Christie (1976; cited by Van Den Hooff, Groot & De Jonge, 2005), Social Presence Theory notes that "communication media differ in the degree to which they can communicate (or simulate) the social presence of the communication partners through the use of social cues (both verbal and nonverbal cues)." This theory purports that if a medium can only communicate limited social cues, communication partners do