Business Decision Making.
Business Decision Making Project description Assignment Brief As part of the formal assessment for the HNC/D programme you are required to submit an assignment for the Business Decision Making module. Please refer to your Student Handbook for full details of the programme assessment scheme and general information on preparing and submitting assignments. After completing the module you should be able to: LO1 use a variety of sources for the collection of data, both primary and secondary LO2 Understand a range of techniques to analyse data effectively for business purposes LO3 produce information in appropriate formats for decision making in an organisational context LO4 use software-generated information to make decisions in an organisation Page 3 of 9 Case Study Appalachian PLC is a manufacture of high end furniture, sold directly to retailers, in mature markets across the UK and Europe. In the past four years the company has seen a decline in its overall sales to the established markets and has decided to investigate the opportunities in a new target geographical market, particularly in China and the Far East. The company is not at the stage of writing a fully developed business plan, but has commissioned a series of presentations and reports to the board on three important initial steps; 1. A brief analysis of the core customer in the established markets. 2. A plan to undertake significant market research in the new target market. 3. A preliminary investment appraisal and project plan for entering the new market. Additional Information for Step 1 The Data presented below in Task One was captured by an outside market research firm using follow up phone calls to customers of one of the biggest UK suppliers of the products merchandise. The respondent rate was very low, only one out of every ten calls were answered. The sample size is therefore very low. Additional Information for Step 2 The company are particularly interested in the type of core customer, the type of prices that can be charged and the levels of income in China. Additional Information for Step 3 The company has commissioned a draft cash budget for the first five years of operations in China, which has been summarized as follows; The company has, in recent years adopted a payback period of three years as a hurdle rate for new project, but given the importance to the company, and the input of the Finance Manager, the Board is interested to look at discounted cashflow. The company has a weighted cost of capital of 10% The company has also investigated the processes in setting up operations in China during year 0. The following information is available. Key Process Dependent Tasks Time to Completion A Leasing Office Space None 3 months B Undertaking Market Research None 6 Months C Finding Local Suppliers of Raw Materials A 2 Months D Identifying Retail Partners A,B 1 Month E Leasing Warehouse Space None 1 Month F Formalizing business contracts with Retail Partners A,B,C 2 Months G Developing logistics and supply chain A,B,C,D,E,F 1 Month H Beginning deliveries to retail partners/commencing normal operations A,B,C,D,E,F,G 1 Month The company has to start operations within one year. (End of Case Study) Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 £, 000 £, 000 £, 000 £, 000 £, 000 £, 000 Cash outflow 1000 200 200 200 200 200 Cash inflow 0 150 250 500 1000 750 Page 4 of 9 Task One The company has carried out some preliminary primary data collection. The company sent a short questionnaire to recent customers to obtain some basic information about the following: Age Gender Location (The company divided the country into the North, n, The South, s, The East, e, and The West, w) The recent spend in £ The customers Gross Income in £ The results of the Data collection are as follows: Required: A) You are to produce a spreadsheet of Descriptive Statistics (3.1, 4.1) to show the following: a. The Mean age and spend, and the Standard Deviations of these variables (2.1, 2.3). b. Histograms of the distribution of age and spend (3.1). c. The Median Income and the Interquartile Range (2.3, 2.4). d. The correlational coefficient between age and spend (2.4). B) Produce a short presentation (3.3) (Suggest 6 slides max) entitled ˜Our Typical UK Customer’ containing graphical representations, including all appropriate labels and trend lines, and analysis of the descriptive statistics calculated in A) above. Note to students, you must interpret the statistics in relation to the business case and present your findings in bullet ID Age Gender Location Spend Income 101 35m n £73.67 £21,173 102 19f e £207.05 £14,175 103 31m s £96.62 £12,343 104 22f n £110.45 £20,571 105 32f s £79.23 £18,081 106 21m w £162.02 £16,302 107 24f n £180.92 £15,205 108 28m w £100.69 £17,722 109 22m w £157.01 £19,174 110 38f s £103.98 £19,519 111 23m e £210.28 £15,574 112 20m w £229.18 £19,406 113 18f n £153.03 £20,294 114 18m w £153.67 £18,849 115 19m s £136.49 £18,613 116 24f e £134.96 £20,097 117 17f n £189.72 £15,582 118 21f w £131.80 £19,699 119 22m s £165.50 £22,427 120 51f n £38.08 £17,527 Page 5 of 9 point form within the presentation, it is also necessary to make to be critical of the validity of the data collection (consider any potential bias). (2.1, 2.2, 2.4, 3.1,3.2) Task Two Required: You are to write a short formal Business Report (no more than 1000 words) (3.4) to cover the following points a) A formal plan to sample potential customers in the new target market (1.1). b) A detailed explanation of any possible secondary sources of data which would be useful to the company (1.1). c) A justification of the Survey Methodology and Sampling Frame, including strategies for reducing any potential bias (1.2). d) As an appendix you must supply a draft questionnaire for approval (1.3). Task Three You are required to write a short formal Business Report (no more than 1000 words) (3.4) on the proposed capital project outlined in the Case Study, your report must include the following: a) An analysis of payback (4.3) b) An analysis of the net present value and an explanation of its superiority over payback analysis (4.3) c) A decision based on the financial criteria (2.2, 4.3, 4.1) d) A GANTT Chart including a critical pathway for the set up processes of year zero, and if the project can be delivered on time. ( 4.2) The Tutor will review submissions for all tasks, however can only guarantee a turnaround time of two weeks. Therefore students who wish to submit the work for review should do so at least two weeks before the deadline. Page 6 of 9 Student Guidelines 1. You should write this assignment as specified in the particular tasks, there should be one spreadsheet, one presentation and two reports. I recommend that the spreadsheet is Excel, the presentation is PowerPoint and the reports are in Word, as the work has to be handed in in one document it is advised that you embed the spreadsheet, or relevant parts as a picture into a word document and embed the individual slides from the presentation into the same document. The two reports should each have their own title page and tables of content, no title page or table of contents is necessary for the presentation or spreadsheet inserts. If you do not wish to use Microsoft Office please be aware that there are difficulties in embedding different software together in one document. 2. You should use diagrams and tables of figures where appropriate ensuring to reference their source. 3. You should include a reference list and a bibliography using the Harvard referencing system. You must ensure that the submitted assignment is all your own work and that all sources used are correctly attributed. Penalties apply to assignments which show evidence of academic unfair practice. (See žGuide to Unfair Practice in AssessmentŸ on the module page on ilearn). 4. It is advised that you write your assignment within the guidelines given above, in particular the two reports should be no more than 1000 words, the total word count should be within approximately 3000 words in order for your research and summarising skills to be developed, and for effective time management. You are required to ensure that the assignment addresses all of the assessment tasks. There is no penalty for being over the suggested word count, however, in the interests of good academic practice, assignments submitted with excessive word counts (e.g. over 3500 words) may be returned to students and asked to be reduced before marking. The word count excludes the title page, reference list and appendices. Where assessment questions have been reprinted from the assessment brief these will also be excluded from the word count. ALL other printed words ARE included in the word count. Printed words include those contained within charts and tables. 5. Your assignment should be submitted as a single document. For more information please see the œGuide to Submitting an Assignment document available on the module page on iLearn. Recommended Additional Resources Textbooks Online E-Book recommended for this course “BTEC HN BUSINESS Study Guide Access to this E-Book is provided via the Vitalsource Bookshelf software “ contact the Student Support Team for access code Additional resources Curwen J and & Slater R Quantitative Methods for Business Decisions 6th Ed. Thomson Learning London 2008 ISBN 978-1-84480-574-7 Wisniewski M Quantitative Methods for Decision Makers 4th Ed. Pearson Education Harlow 2006 ISBN 978-0-273-68789 -4 Business Decision Making 2nd Ed. BPP Learning Media London 2010 ISBN 978-0-7517-6832-9