MGMT 530 Final Exam

MGMT 530 Final Exam
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(TCOs A, B, C, D, E, F, G and H) Tidewater Services recently celebrated its 10th anniversary as
a professional services firm that handles investigations for law firms offering amenities, such as
background checks, surveillance, interviewing of witnesses, crash scene investigation, and other
related services.
The company was founded by Lee Herbert who had extensive experience working for companies
that handle investigative work. Herbert is more of a people person and is always looking for the
next new client to take on. Admittedly, Herbert had no experience in running a business when he
decided to go out on his own and enlisted the help of his long time friend, Bradley Simmons.
Simmons has spent his career working for larger corporations in finance and had no experience
in investigative services, but was looking for a change.
Over the 10 years since the company’s founding, Tidewater Services struggled at first but slowly
grew over the last five years. The more law firms the company works with, the more cases they
receive. The more cases they receive, the more hours they can bill. Tidewater currently has six
investigators and two clerks in addition to Herbert and Simmons. Over the years, they have
expanded and contracted based on the volume of business and the local economy.
Based in Norfolk, Virginia, Herbert is really interested in expanding the business to other major
cities in the region, believing that “there are only so many law firms here in Norfolk.” He feels
that if they’ve survived 10 years, then they should continue to focus on growing the business.
Simmons, on the other hand, feels that expansion will put the company at risk as it takes time to
develop a decent client base. They had opened a second office several years back across town
but eventually closed it when it didn’t generate enough revenue to cover expenses. He’s worried
the expansion may bankrupt the company.
Even though the two are business partners, Herbert is the president and Simmons the vice
president. Herbert asked Simmons to evaluate several options to further expand the business.
From Herbert’s perspective, he has concluded that three objectives are important in this decision.

First, is to find a city with a large number of Fortune 500 companies, a cost of living comparable
to Norfolk, and a city that is in a reasonable distance from Norfolk as he and Simmons would be
spending a lot of time in the new office at first. Because both have families with young children,
Herbert feels that the distance is twice as important as the other criteria.
Here is the summary of Simmons’ research.
I. Richmond, Virginia: Number of Fortune 500 Companies: 5; Cost of Living Comparison: 0.934
(less than Norfolk); Driving Distance: 81 miles
II. Charlotte, North Carolina: Number of Fortune 500 Companies: 7; Cost of Living Comparison:
0.834 (less than Norfolk); Driving Distance: 283 miles
III. Atlanta, Georgia: Number of Fortune 500 Companies: 10; Cost of Living Comparison: 0.854
(less than Norfolk); Driving Distance: 503 miles
Question 1. Define the decision problem and the general nature of the problem. (20 Points)
Question 2. What event triggered
Question 3. Are we imposing any implied constraints on the situation
Question 4. Define the objectives
Question 5. Identify the alternatives
Question 6. Compare and contrast the consequences for all three alternatives by the fundamental
objectives. Rank each alternative using proportional scoring, include weights on the objectives.
Are there any dominated alternatives that can be eliminated? Are there any even swaps.
Question 7. What decision-making styles are at work here? What is their attitude towards risk?

Question 8. Are there any biases in play here that may impact the effectiveness of the decision?
Question 9. What are the uncertainties for this decision situation? What are their consequences?
Question 10. Evaluate this decision situation using tradeoffs. What location should they select?
Are there any linked decisions? Discuss any assumptions as needed.