Question

Group Problem

G17-1

Uncertainty Describe a decision your company has made when facing uncertainty. Compute the expected costs and benefits of the decision. Offer advice on how to proceed. Compute the profit consequences of the advice.

Answer 1

If the company is planned to hire more workers to increase their profit level in future. The entrepreneur of the company is uncertain about the future regarding the hiring of employers. He/she is also unaware about the skills of people hired. The new workers may include highly skilled, skilled and unskilled workers. If all the newly hired workers are highly skilled, the productivity of the company and level of production increased. At the same time the profit level also increased. The expected cost of this uncertainty is the cost incurred during the hiring procedure of new workers. The company should conduct interviews providing proper level of salary to the new employers etc. included in the expected cost. The high level profit earned through the highly skilled workers made high profit to the company. This will reduce the unemployment level in economy also. The firm tried to equate the expected cost and benefit to avoid bankruptcy and failure of the company.
Efficient proceedings to keep in mind by the owner of the company are making match tasks for the employers according to their skills, efficient skills, making the goals more clear and focused, imposition of proper incentives to the employees, proper training and development of the employees etc. Giving preference to these things will improve the level of production to a higher place and at the same time profit also. Comparing the situation before and after the hiring, the company make high level profit only after the hiring. On the other hand, the company faced a cost during the hiring of new workers. Taking efficient and highly talented workers to the firm will increase the profit and maintain the cost occurred during the hiring procedure.