Need notes for unit 7 business decision making ?

Unit 7 Learning Aim B - Business Decision Making

LEARNING OUTCOME B - DECISION MAKING IN BUSINESS

How does a business make a decision?
Businesses make decisions by analysing information and data to understand different
situations. Using the right information helps them make informed choices. Good
decisions can help a business grow and succeed, while poor decisions can lead to
failure or closure.

LEANING OUTCOME B1 - SOURCES FOR DATA COLLECTION

Sources for data collection
⁃ Data helps businesses make better decisions
⁃ Businesses can collect data from different sources
⁃ Data is used to support the decision-making process
⁃ Once data is collected, businesses must follow laws and regulations
⁃ Data must be stored and used legally and ethically
⁃ Businesses must identify what type of data they need
⁃ After this the data is analysed and interpreted
⁃ This analysis helps businesses decide what actions are best for the
business

Collecting data
⁃ Primary sources
⁃ Secondary sources
⁃ Internal sources
⁃ External sources

Primary sources
⁃ Primary data is collected first-hand and is original
⁃ It provides new information tailored to the business’s specific needs
⁃ Even if similar data exists, primary data is current and specific to
the business
⁃ A common method to collect primary data is a survey
⁃ Surveys allow businesses to ask questions that give them exactly the
information they need

PRIMARY DATA COLLECTION
⁃ Sales figures
⁃ HR records
⁃ Questionnaires and online feedback
⁃ Interviews
⁃ Production costs
⁃ Focus groups
⁃ Mystery shopper

INTERNAL & EXTERNAL PRIMARY DATA
Primary data can also be split into internal and external sources
Internal sources are generated from within the business
External sources come from sources outside of the business like:
⁃ Customers
⁃ Competitors
⁃ The market/industry

INTERNAL BEXTERNAL
Sales figures Questionnaires
Production costs interviews
HR records Focus groups

, Mystery shopper
Secondary sources
⁃ Trade journals
⁃ Past sales data
⁃ Previous market research
⁃ Websites
⁃ Books
⁃ Previous campaign data
⁃ Government records

INTERNAL & EXTERNAL SECONDARY DATA
Secondary sources of data collection can also come from internal and external
sources

INTERNAL EXTERNAL
Past sales data Trade journals
Previous market research Websites
Previous campaign data Books
Government records
Storage
⁃ Data must be stored correctly and securely when collected
⁃ Businesses must follow the DATA PROTECTION ACT 2018

Key points to consider when handling data:
⁃ SECURITY OF INFORMATION - keep data safe from theft or loss
⁃ LEGISLATION - follow laws about how data is collected, stored, used
⁃ REGULATORY AND ETHICAL ISSUES - use data fairly and responsibly

Security of Information
⁃ Rules and laws exist for storing both physical and electronic data
⁃ Data must be kept secure at all times
⁃ Data should be kept only as long as necessary
⁃ When no longer needed, data must be disposed of properly

Electronic data should be:
⁃ Password protected
⁃ Encrypted
⁃ Accessible only to staff who need it

Legislative
⁃ DATA PROTECTION ACT 2018 ensures businesses follow legal rules when
handling data
⁃ Many businesses must pay an annual fee to the INFORMATION
COMMISSIONER’S OFFICE (ICO)

This fee which is around £60 helps to fund:
⁃ Data protection research and activities
⁃ Resources and training for small businesses on data protection

THE DATA PROTECTION ACT 2018
Everyone handling personal data must follow strict data protection principles

Data must be:
⁃ Used fairly, lawfully, and transparently
⁃ Used for specified and explicit purposes only
⁃ Adequate, relevant and limited to what it is necessary
⁃ Accurate and kept up to date when needed
⁃ Kept only as long as necessary