Section B
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Question 3
Decision-MakingProcessesat KavangoSteel Inc.
John Kavetu and Jacky Simasiku are both employees of Kavango Steel Incorporated. The company
counts more than 1500 employees and has a presence in almost all Southern African Development
Community (SADC)countries. Kavango Steel Inc. transforms bulk steel into smaller components, ready
to be used in consumer products. Products range from toy parts to food cans. Like most steel companies,
Kavango 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 SADCin order to stay
close to its customers.
The decision-making processes at Kavango Steel Inc. are crucial to the company's operations. Once a
customer (new or existing) approaches the firm, decision making has to 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 Kavango 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 Kavango Steel Inc. has gone through some changes, the bureaucratic structure still has a big
impact on the jobs of both Kavetu and Simasiku. John Kavetu is a manager at a subsidiary in South Africa.
In formulating a proposal or bid for a customer's order, he can be characterized as a very rational person.
Although he takes somewhat longer than his colleagues to do similar work, he has always secured a lot
of customer orders and is therefore considered a very successful manager within the company. However,
Kavango Steel lnc.'s success in recent years has affected his decision making. He now drafts a proposal
faster, but he also considers less information. In some cases, he even takes competitor prices as a
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