1. Understanding the Situation - Read the information below to help you complete steps 2 & 3:

Question

In Unit 3, you read a little bit about Rhonda, a woman who runs a small website development business that has annual revenues of about $500,000. You learned that Rhonda pays herself an annual salary of about $100,000.
While Rhonda’s business is doing pretty well and allows her to live comfortably, she has encountered a problem—she doesn’t know how to grow the business at this point.
Rhonda has been considering hiring some new salespeople to find more customers because her current staff have the availability to take on more work. However, hiring more salespeople is expensive and the cost would come out of what Rhonda pays herself. On the other hand, it could eventually lead to more business in the future and a higher salary for herself in the long run.

2. Working through the process - You are hired by Rhonda to help her figure out what to do. You will use the decision making process below to help you. Fill in your thoughts for numbers 1-4.

Define the problem

Consider possible solutions

Assess the costs and benefits of each solution

Select the best solution based on costs and benefits

Answer 1

1. Define the problem: The problem is that Rhonda wants to grow her business but doesn't know how to do so effectively. She is considering hiring salespeople, but it would be costly and could potentially impact her salary.

2. Consider possible solutions:
- Hire new salespeople to find more customers
- Invest in marketing and advertising strategies to attract more customers
- Develop partnerships or collaborations with other businesses to expand the customer base
- Offer additional services or products to existing customers to increase revenue
- Seek advice or mentorship from experts in the industry to gain insights on business growth strategies

3. Assess the costs and benefits of each solution:
- Hiring new salespeople: The cost of hiring and training new salespeople would be a significant expense. However, it could potentially lead to more business in the long run, thereby increasing revenue and potentially allowing Rhonda to earn a higher salary.
- Marketing and advertising strategies: The cost of implementing effective marketing and advertising campaigns should be considered. The benefits would include increased brand awareness, attracting more customers, and potential business growth.
- Partnerships or collaborations: The costs of developing partnerships or collaborations could be minimal or significant, depending on the nature of the partnerships. The benefits would include accessing a wider customer base and potential business expansion.
- Offering additional services or products: The cost of developing and implementing new services or products should be taken into account. The benefits would include increased revenue from existing customers and potential business growth.
- Seeking advice or mentorship: The cost of seeking advice or mentorship could be relatively low, but the benefits could include gaining valuable insights and guidance from experts in the industry.

4. Select the best solution based on costs and benefits:
After assessing the costs and benefits of each solution, a combination of hiring new salespeople and implementing effective marketing and advertising strategies seems to be the best solution. This approach would allow Rhonda to tap into new customer markets through salespeople while simultaneously increasing brand awareness and attracting more customers through targeted marketing efforts. The combined benefits of these strategies could lead to sustainable business growth and potentially higher revenue, which could justify the initial investment and potentially allow Rhonda to earn a higher salary in the long run.