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Project Capstone: Management Memos and Assumptions

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Critiquing Prior Decisions Made

You have just been promoted from front-line supervisor to be one of the firm's senior managers. During your business education, you learned that the primary role of a manager is to make good decisions. As a supervisor, you had frequently been making routine decisions, but you realize that decision making for the overall company can and will have far greater impact on the company and its employees.

Your boss, the chief executive officer (CEO), realizes that you do not have much practice in this higher level, decision-making process and has asked you to write a memo describing your understanding of how to make important decisions.

Address the following questions:

* Describe at least 3 criteria that would determine whether the manager is making good decisions. What should be done to better assure that you are making a good decision?
* In the realm of decision making, what are assumptions? Rather than use a dictionary definition, cite several specific assumptions that would go with any real-life decision you have made or have seen made at a company at which you have worked.
* Given the importance of proper assumptions, your boss asked you to assess the accuracy of certain business assumptions and what could you do to test or confirm the credibility of them. The following were major assumptions for each firm:

- An automobile manufacturer's assumption that the demand for SUVs would continue because gas prices would continue to rise
- An airline's assumption that there was a need for an airline that provided no added amenities.

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The solution discusses management memos and assumptions.

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Please refer to the attached file for the response.

30 March 2011

The Chief Executive Officer
XYZ Corporation


This is in connection with the instruction received from your good office that the undersigned would conduct some research on the basics of decision making and on confirming certain assumptions.
Please allow the undersigned to provide you the highlights of the findings as indicated below:
1. On the criteria that would determine whether the manager is making good decisions:
a) The correct problem must be identified.
b) All relevant areas in the decision must be considered.
c) Alternative solutions determined must be based on organizational constraints such as human and financial resources.
d) Decisions should only be done after evaluating the set of alternatives.

2. On the nature of assumptions
These are conditions that must be set to be true in order to ensure that a correct decision is made. The following could be examples of assumptions:
a) For a company:
1. Decision is made in ...

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  • Bachelor of Science in Business Administration, University of the Philippines
  • Master in Business Administration, Saint Mary's University
  • Doctor of Philosophy in Education, University of the Philippines
  • Doctor in Business Adminstration (IP), Polytechnic University of the Philippines
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