All-Star Sports eBusiness Division’s Decision Making Process


The modern business environment is quite complicated for successful performance. The global business world is living in the conditions of financial crisis and its consequences. The following consequences of the global financial crisis may be pointed out: problems in a financial system, decline of sufficient demand, difficulties in governmental finances and unemployment, etc. Respectively, it is quite difficult to make effective business decisions in such conditions. The role of decision making process has grown significantly nowadays. The main features of decision making process in All-Star Sports eBusiness Division is going to be considered in this research paper.

It is really important to make effective and right decisions in the modern business world. However, the process of making these decisions are also essential. For instance, every decision should be made on time. Time is one of the most valuable factors of production nowadays. Making decisions faster than competitors can bring significant competitive advantages and, respectively, additional financial resources. Also, the decision making process may affect its efficiency. For example, making a decision in a hurry may significantly decrease its efficiency.

Every company faces typical challenges in the process of making a decision. One of typical questions is whether a decision should be made by a one top-manager or by the whole team of employees. This question was among central questions in a research of a consultant firm for the company under consideration. The company was provided with three alternatives of a decision making process. Generally, these alternatives are the following. First of all, the whole team (all employees) can take part in a decision making process. The second alternative is to form a small team of managers that will be responsible for business decisions. Finally, the last alternative is to improve the existing decision making process, where decisions are made on the different levels of organizational structure of the company according to their responsibilities. In order to understand which alternative is the best for the company under consideration it is important to know its history and background, which is provided below.

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Background information about the company

The company was created in 1998, when the first high-volume discount sporting goods store was opened by the founder of the company. The idea was really successful for those times. The company’s performance was really profitable for the first years of its existence. It had more than 500 retail stores in the United States of America and even abroad. Also, the company has understood that online direction of the business can be really successful (Garvin).

Internet and high technologies have become an integral part of a human’s daily life. People desire to buy products via Internet in order to save significant amount of time and money. There is no need to go to a store to buy a particular product if it is possible to buy it via internet. Online business can bring significant benefits for business too. For instance, they do not need to have stores and pay personnel for work. Everything can be done via Internet. As a result, it is possible to save a lot of money. In the end, the company’s online direction has become one of the most important for the company.

Decision making process in the company

Nowadays the most important question for the company is how to build an effective decisions making process. In order to build an effective decision making process it is important to understand the factors that affect it. Generally, such factors can be divided into two groups – objective and subjective factors. Objective factors refer to external factors that cannot be controlled by the company. Such factors are overall economic situation, political situation, the degree of social and technological development and, finally, overall performance of the company. For example, successful performance of the company makes decision making process easier. People are more relaxed and have more time in such situation. On the other hand, successful business performance puts forward new requirements to decision makers. These decisions should not spoil the general successful way. In turn, negative performance of the company requires new decisions, innovations that are going to improve it.

The other group of factors that affect decision making process is subjective factors. They are related to a human factor and depend on qualifications and features of a person that makes decisions. In any case a decision is made by a person. This person is characterized with specific character, temperament and other features. Finally, even a person life of a manager may affect his/her business decisions. That is why it is very important to account such factors as personal features of a decision maker in the process of business.

The main personalized features that may affect decision making process are the following: ethical problems, happiness and overconfidence. Business ethics is in general a very complicated problem. Sometimes there may be a choice between success of a company and right ethical decision. A good manager and decision-maker should always follow legal and ethical requirements. The most effective decision is that brings the company to the highest success in ethical borders.

Overconfidence of a decision-maker can be a significant problem for a company. People may underestimate a situation and make a wrong decision. Such problem is especially important in the modern conditions of the global financial crisis and its consequences. A good decision-maker always weights up all pros and cons and makes an adequate decision. Russo in his article Managing Overconfidence shows real examples when overconfidence of managers have led to financial losses for companies. He believes that overconfidence can be managed, in particular, via implementation strict requirements to decisions and decision making process in general. The company under consideration must implement such rules in order to increase quality of decisions.

Finally happiness is an overall category that defines the degree of employees’ satisfaction with their job. People should be happy while working for a company. Then they will make the most effective decisions, since they will associate their personal success with success of the company. There are a lot of instruments to stimulate the degree of happiness of employees. Among them financial and social bonuses can be mentioned. Izzo in the article What Salary Buys Happiness in Your City? States that high salary is not the only stimulus for employees. It is important to propose also social bonuses. On the other hand, it is essential to choose reasonable bonuses. It is a well-known fact that managers of financial companies, seeking for bonuses, had made wrong decisions and led to the global financial crisis.

It is believed that such process as decision making can be built only when a defined strategy of the company is developed and the process of strategic planning is established. In general, there are a lot of opinions about the definition of the term “strategy”. The most optimal is the approach that defines the strategy as a process of defining business mission, business goals, segmentation of the markets and positioning of the company, and also the way to achieve these goals. Shortly speaking, it is a vision of a company in business world. It can be applied to the general vision of a company and also to some particular projects.

A vision should explain exactly what the company’s origins are, what the company is now and where the company wants to be in the future. If it is applied to some particular projects the strategy should answer what the results of these projects are going to be and what benefits for a company from realization of this project.

The major assumption in strategic planning is that any organization must be flexible to a changing environment. Thus, the emphasis in strategic planning is on understanding how the business circumstances are changing. Strategic planning has to provide an effective mechanism of adjustment of the organization to these changes. Also strategic planning is not limited by time. It can be short term or long term. The main feature of strategic planning is the changes it brings.

The strategic planning process has some standardized form in any organization. There are always some standardized procedures of making decisions in the strategic planning and people responsible for these decisions. The central element of the strategic planning process is strategic thinking. On the one hand, it is a process of planning, calculating and maneuvering to the stated goals, using some special techniques and methods. On the other hand, it is a special ability of a person to look on the situation globally, to see long-term goals, trends and the most effective way to achieve them. Not everyone has such abilities and, as a result, not everyone is able to think strategically.

Such processes as planning, modeling and calculating make the strategic planning more distinct and, as a result, effective. They help to build a clear way from the current position of a company to the stated goals. Different techniques and standardized methods can be used in the process of calculating and planning.

Impact of the global financial crisis on decision making process

Also it is very important to mention in this research paper about the impact of the global financial crisis on the process of strategic planning of the companies. Because the global financial crisis has put forward new challenges for the majority of the companies. In fact, in the modern circumstances it is almost impossible to use traditional techniques and methods of the strategic planning. Because the situation is changing constantly and it is almost impossible to see some trends and predict the situation. However, on the other hand, the role of a good competitive strategy has even increased in such circumstances. Because it can help a company to avoid different troubles and realize its competitive advantages despite the challenges.

The successful development of any company is impossible without strategic planning, without clear defining of a company’s vision. That is why the strategic planning just has to be used today, but some special considerations should be taken into account by the companies’ managers in the process of the strategic planning.

First of all, nowadays companies are forced to take into account a larger amount of variables and factors that determine the success of business. The success of any business process is determined by a large amount of factors nowadays. They include situation on financial markets, consumers’ behavior, economic situation in some particular countries etc. In order not to fail a company’s managers must measure and take into account the whole range of these factors.

Second of all, it is important to predict different scenarios of some particular situation. That means that a company’s managers in the process of strategic planning have to develop a few scenarios of the possible performance. At least, those are optimistic and pessimistic scenarios. Respectively, different strategies and decisions should be implemented according to different scenarios.

Therefore, the processes of strategic planning has become more complicated in the recent years because of the global economic crisis. And somebody may think that it is impossible to use strategic planning in the given circumstances.

Conclusions and recommendations

In conclusion, the company under consideration is characterized with effective strategic planning. As a result, the decision making process is also effective, since it has correct orienteers. The external objective factors are also supportive for the company. Talking about subjective factors, it is important to mention that the company has professional managers. All of them are not vulnerable to personal influence in the process of decision making. However, a human factors and possibility of a mistake is still present. That is why the best decision for the company will be a group method of making decisions. Possibility of a mistake is going to be minimized in such case.

Generally, the company’s organizational structure should be improved. A new structure must account constant growth of the company and development of online segment of the business. Effective organizational structure that will met requirements of a new business world will minimize human factor and possibility of a mistake in decision making process.

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