Decision making control

Decision making control

Introduction

Response to Andrew Mail

Dear Andrew it looks like you have been carried away with the thought of expansion and increasing revenue and thus have failed to control the cost of your sales. Before providing solution of your problem, let just analyze the probable reasons of the rapid increase in the cost of your sales, firstly, as explained by (Anderson, 2008) the biggest problem of majority of companies in current era is that they are not aware of their cost of sales and thus companies are not able to control their cost.

In your case, because of new first time expansion and new work you failed to give appropriate time to this expansion and thus were not aware with the ground situation. Secondly, rapid increase in the prices of raw materials which are key ingredient of your production process and thus it has made it difficult for the management of your organization control the production cost which has ultimately increase the cost of sales.

Another probable reason of increasing cost of sales could be the fact that your production department is situated in far area that increases the cost of transportation and others, and ultimately results in increase in cost of sales (Hansen et al, 2009). Despite of these reasons and other, you can still manage your cost of sales by ensuring timely adaptation of eight key elements in your organization.

First, is to implement the culture of qualifying system and educate every member of the organization regarding the positive impact of good business on sales of the company

Secondly, implement the culture of focusing on important elements means that focus on those projects that are vital for increasing sales.

Thirdly, avoid investing extensively in current circumstances and try to increase the level of cash flow

Fourth, provide selling staff with new training to increase their efficiency level and skills and encourage them to think beyond their personal development towards the growth of organization

Fifth, attracting new customers is vital of organizational growth, however, you must first ensure to satisfy the needs and demands of existing customer because once existing customers are satisfied new customer would automatically get attracted towards your product and service

Management must conduct in-depth analysis of probable risk that could prevent organization from accomplishing their goals and develop innovative strategy to overcome these unexpected risks

Management of your company must try to lower additional expenses by developing clear job description for every employee and instruct employees to work according to their work requirements

Instead of developing long-term budgets, the company must focus on developing budget on monthly bases as it would allow them the monitor and identify the trend in changes of cost on continual bases

Management of your organization must try to increase the wages of employees so that they can work with more enthusiasm and loyalty

In addition to prescribed solution, you can implement any other relevant strategy that you could feel would prove to affective in improving the overall position of the company, however, in order to accomplish this ...