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HBO Activity Written Report

The document summarizes a group's decision to close a factory in Smallville. It cites four key reasons for the decision: 1) operating carries risk of not being able to compete on quality or price, 2) addressing the challenges requires a complex non-programmed decision, 3) money would be better spent on employee benefits, and 4) continuing would likely lead to bankruptcy as losses mount and expenses increase without the ability to recover.

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Steph Co
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47 views2 pages

HBO Activity Written Report

The document summarizes a group's decision to close a factory in Smallville. It cites four key reasons for the decision: 1) operating carries risk of not being able to compete on quality or price, 2) addressing the challenges requires a complex non-programmed decision, 3) money would be better spent on employee benefits, and 4) continuing would likely lead to bankruptcy as losses mount and expenses increase without the ability to recover.

Uploaded by

Steph Co
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
Download as docx, pdf, or txt
Download as docx, pdf, or txt
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HBO Activity

Decision-Making Skills

Bacud, Karen Patricia Bernardo, Patrick Xavier Borja, Mica Cabantog, Marie Josephinne Co, Stephanie Janel

UST AMV-College of Accountancy 3A4 Sir Peter Daniel Fraginal

July 31, 2012

Our group decided to close the factory in Smallville. 1. There is a condition of risk. The owner doesn't know if he will be able to beat his opponent and he doesn't know what the outcome will be. He may be able to be at par with the quality by enhancing the resources and facilities but he will have more expenses than his opponent. Ergo, he will still lose. 2. A Nonprogrammed Decision Since the owner hasn't encountered the problem before, he will have to make a non-programmed decision which will take a long time to have a solution. 3. Compensatory Benefits The employees are already old. The money that the owner will use for the enhancement of the quality of the goods must be given instead as compensatory benefits to the employees 4. Bankruptcy The owner is already losing money and will still add expenses. It will be hard for him and his employees to recover. In the long run, the business will choose to close down its business since it wouldnt be earning anymore.

Summary: We opt to close the factory since it will be hard and costly for them to recover especially that they are facing a more competitive environment in their industry. Moreover, if they will still continue their operations, there is no assurance that they can recover knowing the fact that their competitors are selling goods with lower prices and better quality.

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