Decision making for international business

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Faculty of Business and Law

Assignment Brief Academic Year 2017/18

Assessment Information

This assignment is designed to assess learning outcomes:

ILO1: Identify and organise credible sources of data and information

ILO: Critically evaluate information to support decision making

ILO3: Appraise results of the decision-making process

ILO4: Assess and critically evaluate the range of tools and techniques available as support for managerial decision making This assignment is an individual assignment.

Assignment task:

Pashley Cycles, a British bicycle manufacturer wishes to identify an export market as part of its growth strategy. Three possible markets have been identified: Germany, India and Brazil. Assume the role of management consultant to the company and write a report which examines each of these options.

You should review data, evaluate factors in the decision-making process and apply decision-making tools and techniques. Your report has to make recommendations to the company and these should be fully justified.

Word Count

The word count is 2,500 words. There will be a penalty of a deduction of 10% of the mark (after internal moderation) for work exceeding the word limit by 10% or more. The word limit includes quotations, but excludes the bibliography.

Please note: you MUST NOT contact the company as part of this exercise.

Weighting of Marks

Marks will be weighted as follows:

Nature of the topic/s – 20%

Sources Consulted – 20%

Analysis and Discussion – 40%

Conclusions and Recommendations – 10%

Presentation and References – 10%

Company information:

Pashley Cycles

Pashley was established in 1926 in Birmingham and is the UK’s longest established cycle manufacturer.

Pashley designs and manufactures traditional bicycles, carrier cycles, tricycles and accessories.  It currently offers about 160 products and supplies between 8,000 and 10,000 bikes each year (Financial Times 2016).

All cycles are hand-built at the company’s facility located in in Stratford-upon-Avon, Warwickshire.  There are approximately 50 people employed at the factory.

The company does not publish financial figures but annual turnover is in the region of £5 million (Financial Times 2016).

Women’s bikes account for half the company’s sales.

75%-80% of sales are in the traditional segment.

The company has two divisions: Business to Business sales (B2B) and Business to Consumer (B2C).  95% of consumer sales are through distributors.

Over the last 5-6 years, export turnover has increase from 15% to 45%.

The company currently exports to 47 countries and has created a distributor network to support this activity.

North and South America, Europe and Far East have all exhibited strong demand.

Website:

http://www.pashley.co.uk/

Notes from class (very important)

Requirement: 2,500 word report

Task: Pashley Cycles, a British bicycle manufacturer wishes to identify an export market as part of its growth strategy.  Three possible markets have been identified: Germany, India and Brazil.

Assume the role of management consultant to the company and write a report whichexamines each of these options.  You should review data, evaluate factors in the decision-making process and apply decision-making tools and techniques.  Your report has to make recommendations to the company and these should be fully justified.

The company wishes to focus on one particular export market as part of its growth strategy

Three potential markets have been identified: Germany, Brazil and India.

You need to provide:

  • Attributes
  • Values for the Attributes
  • Weighting
  • Costs

Good book to use-

Goodwin, P. and Wright, G. (2014) Decision Analysis for Management Judgement.  Fifth Edition. Chichester. Wiley

 

Chapter Three

Digital copy can be accessed through Moodle –

Module Links

Resource/Reading List

Essential Reading – then download

Who buys Pashley cycles?

What are the advantages and disadvantages associated with Pashley cycles?

Who are the company’s competitors?

Identify Possible Attributes

These should help you understand the countries you are considering and may include:

  • Population
  • Urbanisation
  • Distance from the UK
  • Household income distribution
  • Consumer spending on leisure and recreation
  • Political stability

Select attributes following your analysis of the company and its products.

  • You need to justify your selection of  attributes.
  • Choose between four and six attributes.
  • How you justify your choice of attribute is more important than the number you choose.

Example:

Consumer spending on leisure and recreation by income type in Brazil

Apply Values to SMART

  • Once you have gathered the data, you need to amend the values to fit into SMART
  • Values in SMART are between 0 and 100.
  • Weights are based on your analysis of the importance of the attributes. You will need to justify the weights.
  • After you have selected your raw weights, do not forget to normalise them.

You should use the SMART tool

  • Assuming six attributes: W1*V1 + W2*V2 + W3*V3 +W4*V4 + W5*V5 + W6*V6 = Total
  • Calculate a score for each option

Costs – these can be your estimates based on a company with an annual turnover of £5 million.

Suggested categories:

  • Marketing
  • Distributor Management
  • Once you have calculated the benefits you need to use costs to plot the cost-benefit graph
  • Plot the efficient frontier
  • Make a provisional decision

As with any SMART process you should carry out a sensitivity analysis

If necessary use these videos to help you:

structure:

 

Table of Contents

1.Introduction

2.Company Background

3.SMART – justification for using this tool

i.Objectives

ii.Options

iii.Attributes

iv.Values

v.Weights

vi.Benefits

vii.Costs

viii.Cost-Benefit Analysis

ix.Sensitivity Analysis

4.Conclusions

5.Recommendations

6.List of References

Resources:

Goodwin, P. and Wright, G. (2014) Decision Analysis for Management Judgement.  Fifth Edition. Chichester. Wiley.

Janavaras, B.J. and George, S. (2017) Global Marketing Management System.

Singapore. World Scientific Publishing.

Janavaras, B.J., Paladini, S., George, S. (2013) Going Global: A Practical Guide. Harlow. Pearson.

Kavanagh, M. (2011) ‘Pashley Cycles benefits from a renaissance for retro style’ Financial Times. 20 February/

Lasserre, P. (2012) Global Strategic Management.  Third Edition. Basingstoke. Palgrave Macmillan.

Organisation for Economic Co-operation and Development (2008) Removing Barriers to SME Access to International Markets. OECD Publishing.  Available at http://dx.doi.org/10.1787/9789264045866-en

Wright, R. (2016) ‘Pashley steers growth with new contracts and vintage appeal’ Financial Times. 4 October.