Mgt Full Research Report

INTRODUCTION TO ASSIGNMENT

This assignment depicts our efforts on analysing the case of decision making problem that befall Soaring Eagle Skate Company. The purpose of  this assignment is to achieve aknowing managerial decision making problem that is faced by the manager of the company, Stan Eagle. We did an assay to give a brief summary on how Eagle encountered such problem as a manager in order to help his company to recover from the downfall.

In the end, we will evaluate our project objective and there are some Islamic perspectives on the issue that is going to be discussed by our group and a conclusion of this whole project.

There are several objectives that we want to accomplish by the end of this case study, we are asked to determine how the characteristics of management decisions affect the decision facing Stan Eagle and what can he do to increase the likelihood of making the best decision in this situation. By studying the case of Soaring Eagle Skate Company, we are going to describe the kinds of decision that Eagle faced as the manager. So, we will classify several characteristics of managerial decisions that contributed to Eagle’s difficulty and pressure thus affecting the decision making process of the company. Next, we were enlightened on the fact that the company was in a situation of a dilemma in the effort of making the best decision for the company given such challenges. After we did a thorough analysis and deep discussion, we will come out with the steps that Eagle can take to increase the likelihood of making the best decision in this situation.

BACKGROUND OF THE COMPANY

Stan Eagle loved riding his skateboard and doing tricks, he has entered professional contests and wins by himself. While he grown up, he chose skateboarding sport as his career. After a while, his interest in the sport waned and decided to take a new direction in his business. He decided to launch into designing, building and selling skateboards under his own print brand. He collaborated with his friend Pete William, they entered to skateboard business. He pooled his own personal savings with money from William and came up with $75 000.

The company prospered and Eagle considered ideas for expansion. Another friend had designed a line of clothing he thought would appeal to Eagle boarding’s fans. At the friend’s urging, Eagle branched out into clothing for skateboarders but the price mark ups were declining and the sale channels were entirely different. Three years into the expansion, Soaring Eagle had invested millions of dollars but still losing money. He decided to sell off that part of business to a clothing company.

SUMMARY

Stan Eagle realized his love for riding his skateboard and doing tricks when he was a child, making him so proficient at the sport that he began entering professional contests and taking home prize money. Due to his success and popularity in the sport that he was sponsored in competitions and demonstrations around the world, he decided to launch into designing, building and selling skateboards under his own brand. With the help from his friend, Pete William, they managed to come out with $75,000 to finance the start up. As the company prospered, Eagle considered ideas for expansion. He then accepted an idea from another friend to branch out into clothing for skateboarders. However, he found out that the clothing business is completely different from business of sports equipment. Problem emerged when the company started to lose money after invested millions of dollars in the line thus made Eagle sell off that part of the business to cut out his losses. A new idea came out from his business partner, William—sell sports equipment for inline roller skates and ice skates. Eagle was doubtful to accept the idea as he knows nothing about the two sports and thought that the company would be better off focusing on the sport in which it offered the most expertise. Even though William pointed out that a little risk would give a little hope, Eagle was troubled as he was so done with what happen to the company before when they tried the clothing business. He saw the failure as a message that they needed to be careful about expansion. But he seemed unable to persuade William to accept his point of view. In the end, Eagle was left hanging between two options, whether to go along with William and take the chance of losing money again, or to buy William’s ownership share in the company and then continue running Soaring Eagle on his own.

ISSUES / QUESTIONS

1. How do the characteristics of management decision-uncertainty, risk, conflict, and lack of structure-affect the decision facing Stan Eagle?

1. Lack of structure

Lack of structure is the usual state of affairs in managerial. There are programmed decision and non-programmed decision. In the case of Eagle Company, it encountered a non-programmed decision where the complex decisions have no certain outcomes. Eagle Company faced a dilemma whether it should or should not invest in the new product lines. There are no proven answers about whether the new business that William proposed will help to cover the losses from the clothing business or can bring more profit to help the company’s growth. The reasons include, the idea proposed is a new area for the company, Eagle has no expertise or experience in inline roller skates and ice skates.

1. Uncertainty

Uncertainty is the state that exists when decision makers have insufficient information to know the consequences of different actions. They may feel unsure of themselves. For Eagle Company, this uncertainty will bring about wariness whether or not the company will succeed by entering the business as Stan Eagle has no expertise about the new products, inline roller skate and ice skate. Even if he enters the market with the new products, there is a doubt on how well he can manage the new business as he knows nothing about these sports. Thus, there is a big question whether or not he will make profits from it. The company will surely be operating under conditions of uncertainty with the lack pertinent information and cannot estimate accurately the likelihood of different results of their actions. This will eventually hold Eagle Company back from taking action.

1. Risk

Risk exists when the probability of an action being successful is less than 100 percent and losses may occur. If the decision is wrong, one may lose money, time, reputation or other important assets. In the case of Eagle Company, accepting William’s proposal is such a huge risk to take, as we can see that the company is facing loses in the clothing business even with such expertise from Stan-one of the most knowledgeable person about skateboarding in the world, what more on something that he doesn’t even know about. It is a fact that it sometimes seems as though risk takers are admired, the reality is that good decision makers prefer to manage risk. Stan should accept the fact that decisions have consequences entailing risk, but he should do everything he can to anticipate the risk, minimizing it and control it.