Discuss why qualitative characteristics must be considered when making decisions such as special orders, outsourcing, elimination and replacement decisions, and scarce resource allocation decisions. Give examples.
What will be an ideal response?
Answers will vary
As with quantitative data, qualitative characteristics that differ among the alternatives are relevant for decision making. For example, in special order decisions, an important qualitative characteristic is the expected reaction of existing customers if they discover that the company has sold products to other customers at a lower selling price. In outsourcing decisions, management must worry about the possibility of low-ball pricing, quality fluctuations, and the likelihood that the supplier may discontinue operations. In elimination decisions, management must worry about the impact on employee morale and productivity if employees associated with a discontinued segment are terminated.
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Indicate whether the statement is true or false
A company has purchased inventory and received an invoice that requires the buyer to pay the transportation costs for delivering the merchandise. The terms are ________
A) FOB destination B) FOB shipping point C) FOB, 2/10, n/30 D) FOB in transit
Napoleon doesn't know what to think, since he has no idea which scenario will happen. Which criterion is he well-suited for and what is his decision?
Napoleon is contemplating four institutions of higher learning as options for a Masters in Business Administration. Each university has strong and weak points and the demand for MBA graduates is uncertain. The availability of jobs, student loans, and financial support will have a significant impact on Napoleon's ultimate decision. Vanderbilt and Seattle University have comparatively high tuition, which would necessitate Napoleon take out student loans resulting in possibly substantial student loan debt. In a tight market, degrees with that cachet might spell the difference between a hefty paycheck and a piddling unemployment check. Northeastern State University and Texas Tech University hold the advantage of comparatively low tuition but a more regional appeal in a tight job market. Napoleon gathers his advisory council of Kip and Pedro to assist with the decision. Together they forecast three possible scenarios for the job market and institutional success and predict annual cash flows associated with an MBA from each institution. All cash flows in the table are in thousands of dollars. School Scenario 1 Scenario 2 Scenario 3 Vanderbilt 95 20 -10 Texas Tech 55 60 60 Seattle 90 10 80 Northeastern State 65 50 60
A disadvantage of oral communication is that it
A. is more expensive than written communication. B. does not enable the sender to receive feedback. C. is difficult to sense the sender's sincerity. D. can lead to spontaneous, ill-considered statements. E. is not very persuasive.