MT499 Unit 2 Decision Question Proposal Example

One Question, Three Live Answers, Criteria Fixed First: An MT499 Unit 2 Decision Question Proposal for Halsey Hearing

[Student Name]

Purdue University Global

MT499: Bachelor's Capstone in Management

Unit 2 Decision Question Proposal

[Instructor Name]

[Date]

Halsey Hearing and its figures are composite; the regulation and sources cited are real.

The Question

Which of three responses to the over-the-counter hearing-aid market should Halsey Hearing adopt in its fiscal 2028 plan: launch its own consumer brand, manufacture a store-brand device for a national pharmacy chain, or keep its products in clinics and fund a program that helps independent clinics compete?

The question is written so that each answer could be wrong, and each carries a real cost if it is. That property rules out broader questions about growth or competitiveness, which no evidence could settle.

Why the Question Matters to Halsey

Halsey earns most of its revenue from devices fitted and sold by independent audiology clinics, and the over-the-counter category creates a second route to the same customers that bypasses those clinics. Adults with mild to moderate loss, the group the new category targets, are the patients clinics most often see for a first device. If the consumer aisle takes a growing share of those first purchases, Halsey's clinic business shrinks whether or not Halsey takes part. Doing nothing is therefore a choice with consequences too, which is why the clinic program is framed as an active answer rather than as the status quo. The question is urgent because the fiscal 2028 plan will lock in spending for the next three years.

Owner and Deadline

The chief executive recommends and the board approves, in time for the fiscal 2028 plan, which the board adopts in its December meeting. Fixing the owner and the deadline now lets a reviewer check later whether the final memo still answers the same person on the same schedule.

Three Answers, Argued Fairly

Own brand. Halsey would design and market a Halsey-branded over-the-counter device sold through pharmacies and online. The case for it: the consumer segment is growing, Halsey's devices perform well, and owning the brand captures the full wholesale margin. Its risk: independent clinics, which sell most of Halsey's prescription devices, may see the company as a competitor.

Store brand. Halsey would manufacture a device sold under a pharmacy chain's own label, on a multiyear supply contract. The case for it: Halsey uses spare plant capacity, takes no consumer marketing risk and keeps its name off the shelf. Its risk: the retailer keeps much of the margin and may not renew.

Clinic program. Halsey would stay out of the consumer aisle and spend on training, financing and marketing support that helps independent clinics hold their patients. The case for it: it protects Halsey's largest channel and plays to its strengths. Its risk: its value depends on how fast clinic sales would otherwise erode, which nobody can yet observe.

An option written to lose would make the eventual recommendation meaningless.

Criteria, Fixed Before the Evidence

Five criteria will judge the options, with weights set now. Value, measured as what five years of each option's cash flows are worth today when discounted at 10 percent, carries 20 percent. Robustness, whether that value survives three stress tests on each option's weakest assumptions, carries 35 percent. Exposure of independent-clinic revenue, about $522 million a year, carries 20 percent. Reversibility, whether Halsey could undo the choice within three years at modest cost, carries 15 percent. Fit with capabilities Halsey already has carries 10 percent.

Robustness receives the largest weight because every option rests on estimates an outside analyst cannot check. Kahneman et al. (2011) warn that decision makers tend to favor the option with the most attractive forecast while neglecting how uncertain that forecast is, and fixing criteria before seeing the numbers protects the analysis from the writer's own preference.

Evidence Each Criterion Needs

Net present value needs revenue, margin and cost figures from Halsey's annual report and earnings calls, retail price points from trade press, and the regulation's labeling rules (Food and Drug Administration, 2022). Robustness needs the same inputs, varied. Clinic exposure needs channel data from the annual report. Reversibility needs contract terms typical of private-label supply. Capability fit needs the company's own description of its plants, software and sales force.

Schedule

Unit 3 profiles Halsey from its filings and earnings calls. Unit 4 analyzes the factors inside and outside the company that bear on the three answers. Unit 5 costs each answer and applies the stress tests. A seminar hearing in Unit 6 tests the leading recommendation before a mock board, Unit 7 commits to one answer in a memo, and Unit 8 plans how the company would carry it out. Unit 10 presents the whole case to a board-style audience, answering the question exactly as worded here.

What the Filings Will Not Show

Three things stay private: Halsey's cost per device, its sales clinic by clinic, and the terms of any supply contract. Each will be replaced by an estimate derived from public figures and marked as an estimate, and the stress tests in Unit 5 will show how much the answer depends on each one. Brealey et al. (2020) note that a project's value is only as reliable as its weakest input, and these three gaps are the weakest inputs here.

References

Brealey, R. A., Myers, S. C., & Allen, F. (2020). Principles of corporate finance (13th ed.). McGraw-Hill Education.

Food and Drug Administration. (2022). Medical devices; ear, nose, and throat devices; establishing over-the-counter hearing aids. Federal Register, 87(158), 50698-50762.

Kahneman, D., Lovallo, D., & Sibony, O. (2011). Before you make that big decision. Harvard Business Review, 89(6), 50-60.