The paper "Paramount Inc - Supply Chain Management and Decision Making" is a good example of a management case study. The principal goal of an organisation is to make a profit by attracting and retaining customers. This can only be achieved through strategic planning where a company translates its key competencies and resources into competitive advantages (Burrow, 2008, p. 34). The framework of achieving all of the above is through a decision-making process that involves critical thinking. Managers while making decisions are faced with uncertainties as future trends are not clear and can only be anticipated.
The anticipation of the future allows the firm to adapt to change and shape the future as a strategic advantage (Jones and Hill, 2007, p. 100). However, at times futuristic decisions made might not provide that needed solutions (Kristandl and Bontis, 2007, p. 943). This paper explores the concept of decision making under uncertainties. The paper uses the author’ s case example of a decision made at the workplace as a supplies manager that did not go correct by identifying issues that arose as outlined in the subsequent paragraph. Moreover, the paper examines in a critical perspective how the author would have tackled the same had he been exposed to various decision theories. The Decision to Outsource Our company (Paramount Inc. ) deals with interior dé cor with specialisation in curtains and blinds.
The company main raw material is rolls of bleached cotton and linen. The company does not have the capacity to manufacture its own and with the need to focus on the core aspect which is a design & reduce the production cost, the firm agreed to outsource the raw materials. As a supplies manager and secretary to the board, I managed to convince the tendering board to award the contract to Cotton World Company as the main supplier of linen & cotton wool.
One reason for their acceptance was that almost all top-level managers and line managers had a close relationship with Cotton World Company. Moreover, the other bidder (Cushion Inc. ) which was our previous supplier was not in good books with the company. The staff in my office claimed they disliked the attitude of some of their employees.
In addition, they were not able to accommodate our company’ s wishes. Unsatisfactory Outcome Two months down the line, it emerged that Cotton World Company had engaged in management buyout without any venture capitalist. This made financing very difficult. Consequently, this meant that Cotton World Company had to count every cent to be able to produce its main products. The imminent danger was that it was a matter of time before our products no longer belong within the focus of its business unless our company is prepared to finance the investment. The blame pointed was that I was not able to check their financial position much earlier.
In a nutshell, as a supplies manager, I had chosen a small supplier in comparative terms without assessing their suitability to supply a big company. Analysis of the Issues in the Context of Supply Chain Management and Decision Making Supply chain management philosophy is pegged on the system view approach rather than a set of fragmented parts. This translates to the fact that supply chain management extends the concept of partnership into a multiform effort to manage the total flow of goods from the supplier to the ultimate customer.
Thus, each firm in the supply chain, directly and indirectly, affects the performance of all other supply chain members, as well as ultimate, overall channel performance (Mentzer, 2001, p. 9). One way in which a firm can increase its profitability and market leadership is by reduction of operating cost through cost-cutting measures. One key area of cost-cutting measures is by concentrating on the core functions of the firm. This can only be achieved by efficiently integrating suppliers, manufacturers, warehouses, and stores so that merchandise is produced and distributed at the right quantities to the right location and at the right time (Simchi-Levi, Kaminsky and Simchi-Levi, 2004, p.
Boyd, E. M. & Fales, A. W. 1983. Reflective Learning: Learning from Experience. Journal of Humanistic Psychology, Vol. 23 No. 2, pp. 99–117.
Burrow, L.J. 2008. Marketing. London: Simon and Schuster.
Chandra, A., Krovi, R. & Rajagopalan, B. 2009. Risk Visualization: A mechanism for Supporting Unstructured decision Making Processes. The International Journal of applied management and Technology, 6(4): 48-70.
Cousins, P. D., Lawson, B. and Squire, B. 2006. Supply chain management theory and practice: the emergence of an academic discipline. International journal of operations and production management. Volume 26 Number 7, ISSN 0144-3577
Hieber, R. Supply chain management: a collaborative performance measurement approach. Zurich: vdf Hoschschulverlag AG
Hodgkinson, G.P. & Starbuck, W.I. (2008). The Oxford handbook of Organizational Decision Making. Oxford: Oxford University Press.
Johnson, J.A. 2009. Health Organizations: Theory, behaviour, and Development. Sudburry: Jones and Bartlett publishers, LLC.
Jones, B.D. (1999). Bounded Rationality. Annual Review of Political Science, 2, 297-321.
Jones, R.G. & Hill, L.C. 2007. Strategic Management. New York: Cengeage Learning.
Kahneman, D., Lovallo, D. & Sibony, O. 2011. The Big Idea: ‘Before you make that big decision...’ Harvard Business Review
Kristandl, G. & Bontis, N. 2007. Constructing a definition for intangibles using the resource based view of the firm. Management Decision, 45(9): 1510-1524.
Lipman, M. 2003. Thinking in education second edition. Cambridge: Cambridge University Press.
Lunenburg, F.C. & Ornstein, A.C. 2012. Educational Administration: Concepts and Practices. Belmont: Wadsworth Cengage Learning.
Mentzer, J. T. 2001. Supply chain management. Thousand Oaks, California: Sage publication Inc.
Oliveira, A. 2007. A Discussion of Rational and Psychological Decision-Making Theories and Models: The Search for a Cultural-Ethical Decision-Making Model. Electronic Journal of Business Ethics and Organization Studies. Vol. 12, No. 2.
Shanteau, J. 2001. Management Decision Making. In Craighead,W.E. & Nemeroff, C.B. (Eds), Encyclopedia of Psychology and Behavioral Science (913-915). New York: Wiley.
Simchi-Levi, D., Kaminsky, P. and Simchi-Levi, E. 2004. Managing the supply chain: the definitive guide for business professional. New York: McGraw-Hill
Sunita. 2005. Politics, Ethics and Social Responsibility of Business. New Delhi: Paragon Books.
Swansburg, R.C. 1996. Management and leadership for Nurse Managers. Sudburry: Jones and Bartlett publishers, LLC.