Which project should Fawn approve? How should he justify his decision to the board of directors, who have already been exposed to Eustace’s ideas?
The decision about which project to approve depends on a range of factors, including the value of the project, financial viability, market demand, technological advancements, the risks involved, and the strategic priorities of the organization. Fawn should justify his decision to the board of directors based on a thorough analysis of these factors, and should also address any concerns or objections that may have been raised by Eustace or other stakeholders.
To justify his decision to the board of directors, Fawn can highlight the strengths of the Merseyside project, such as its higher NPV and IRR, its alignment with the company’s strategic objectives, and its lower risk profile. He can also address the concerns raised by Eustace regarding the flexibility of the project by emphasizing the importance of investing in projects with a clear strategic focus. It is important to communicate the rationale behind the decision clearly and effectively, especially considering the influence of Eustace’s ideas on the board.
Ultimately, the decision should be based on what is best for the organization as a whole, rather than on individual interests or political gamesmanship.
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Why are the Merseyside and Rotterdam projects mutually exclusive?
The Merseyside and Rotterdam projects are mutually exclusive because Diamond Chemicals cannot invest in both projects at the same time due to budget constraints and other limitations. The projects require significant financial resources and managerial attention, which cannot be split between the two. Moreover, the projects have different strategic and operational implications, which make it difficult to pursue them simultaneously. For example, the Merseyside project focuses on increasing production efficiency and reducing costs, while the Rotterdam project aims to expand the company’s market share in Europe. Pursuing both projects simultaneously would dilute the company’s focus and potentially lead to conflicts in resource allocation and strategic direction