Decision Making Process of the Goodyear Tire and Rubber Company

Published: 2021-09-03 13:25:09
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Category: Business

Type of paper: Essay

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CONTENTS
Case overview................................................................................
Step 1: Define Problems ....................................................................
Step 2: Enumerate the Decision Factors ..................................................
Step 3: Consider Relevant Information .....................................................
Step 4: Identify the Best Alternative .......................................................
Step 5: Develop a plan for implementing the chosen alternative .........................
Step 6: Evaluate the decision.....................................................................










Cases Overview
The Goodyear Tire and Rubber Company decided to reconsider about Sears offer in 1992, as Goodyear tires were losing popularity and demand in Sears and customers were searching for higher grade and greater quality products. The market then was saturated, and was divided to the two main subgroups which were the original tire market and the replacement tire market. The Original Equipment Manufacturer tires were sold by tire manufacturers directly to automobile manufacturers, which account for 25 - 30% of production annually. The replacement tire marker on the other hand accounted for 70 - 75 % of the market share annually. This is where Goodyear has the utmost advantage, and is the market share leader within the US market.
Goodyear need to reconsider on the Sears proposal because they realize that there is 3.2% decline in market share for passenger car replacement tire in US. This share decline represented a loss of about 4.9 million tire units. Nearly 2 million worn out Goodyear brand tire were being replaced annually at 850 Sears Auto Centers in Unites States. If Goodyear accept the proposal, it would represent a significant change in distribution policy and create conflict with its franchised dealer. They also need to consider whether to sell only Goodyear Eagle brand or all of its brands.
In order to decide which is the best decision to made, the Goodyear can use a systematic decision making process that can help management to find a better solution




Step 1: Define Problems
In order to make the decision, Goodyear first needs to define the problems that occur in their company. Based on the case reconsider the proposal, the main problems for the company upon analyzing the case are there is a decline in market share of replacement tires, and less repurchased tires.

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