Managerial Decision Making • 159
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On the Job Video Cases Answers
On the Job: Mi Ola Swimwear: Managerial Decision Making
1. What role does an advisory board play in this business owner’s approach to decision
making? If you were a business owner, would you want to develop an advisory board?
Mi Ola, which means “My Way” is a business that requires decision making in an atmosphere of
uncertainty. Fogerty knows which goals she wishes to achieve, but information about alternatives
and future events is incomplete. Factors such as price, production costs, volume, or future
interest rates, are difficult to analyze and predict. She has to make assumptions from which to
forge a decision, even though it will be wrong if the assumptions are incorrect. Since many
problems have no clear-cut solution, Fogerty relies on creativity, judgment, intuition, and
experience. Faced with uncertainty, she turns to her advisory board to provide moral support
when problems arise. She has a person in London who helps her build her brand and others in
whom she can confide when she has to make tough financial decisions. These advisors provide
expertise that help ease the stress of making tough decisions.
2. After listening to this entrepreneur’s perspective on decision making, how would you
categorize her decision-making style? Include at least two examples that support your
choice.
Fogerty uses a new trend in decision making, quasirationality, which combines intuitive and
analytical thought. For example, she makes financial decisions aggressively by analyzing all the
information available. As per the administrative mode, she operates in an atmosphere of bounded
rationality, a limited amount of information on which to base decisions. She satisfices by
choosing the alternative that satisfies minimal decision criteria. However, Fogerty also relies
heavily on intuition. When she designs swimsuits, she selects the colors, fabrics, and sizes based
on her personal ideas and past experience.
Quasirationality is seen in Fogerty’s decision to manufacture her products in the United States.
She is participating in a trend to bring manufacturing home, the “Made in America” movement.
Although she says that at some point she may look into offshoring, she made the decision to
design, manufacture, and sell her swimwear in the United States. This decision is a combination
of rationality and intuition.
3. Customer feedback is an important part of this entrepreneur’s decision-making process.
Referring to the innovative decision-making techniques described in the last section of this
chapter, how would you categorize “getting feedback”? Why is feedback valuable in
decision making?
Feedback is important because decision making is an ongoing process. Feedback provides
Fogerty with information that can precipitate a new decision cycle. Many problems are solved by
trying several alternatives, each providing modest improvement. Feedback is the part of
monitoring that assesses whether a new decision needs to be made.