Case Incident 1 Decision-Making Processes at Steel Inc.

This exercise contributes to:
Learning Objectives: Define perception, and explain the
factors that influence it; Contrast the rational
model of decision making with bounded rationality and
intuition; Explain how individual differences and
organizational constraints affect decision making
Learning Outcome: Apply the study of perceptions and
attribution to the workplace
AACSB: Reflective thinking

John Pieterson and Jack Gack are both
employees of Steel Incorporated. The
company counts more than 5,000
employees and has a presence in almost
all European countries. Steel Inc.
transforms bulk steel into smaller
components, ranging from toy parts to
food cans, ready to be used in consumer
products. Like most steel companies,
Steel Inc. is a traditional company
characterized by a low level of flexibility
and high levels of bureaucracy. The
company has several branches and
subsidiaries located all over Europe in
order to stay close to its customers. The
decision-making processes at Steel Inc.
are crucial to the company’s operations.
Once a customer (new or existing)
approaches the firm, decision making
must happen at a quick pace. Obviously,
decisions with regard to level of
customization, speed of manufacturing,
and prices determine which of the
competing companies gets the order.
When making a proposal, a huge number
of factors must be considered. Not only
does all internal information have to be
considered, but external information
such as competitors’ proposals also must
be taken into account. If Steel Inc. takes
too long to deliver a clear proposal,
cannot deliver the demanded products
fast enough, or bids too high,

competitors will seal the deal. Although
Steel Inc. has gone through some
changes, the bureaucratic structure still
has a big impact
on the jobs of both Pieterson and Gack.
John Pieterson is a manager at a
subsidiary in The Netherlands. In...

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