Answer the following question for details:

1. Identify the key problem / issue 2. Identify the ideal solution 3. Establish the facts 4. Identify the stakeholders 5. Identify the available options 6. Consider the advantages and disadvantages of these options 7. Decide on the best way forward

Context: You and your colleagues are members of the management team at MallReit, a medium-sized operator of shopping centres and car parks. Your own offices are located in rather crowded office space in Causeway Bay. You operate 6 shopping centres and their car parks in locations across Hong Kong. 93% of the shop units currently have tenants. Cleaning, security and maintenance services are all outsourced. You are a listed company, operating on a very tight profit margin. This has put pressure on dividends and affected your share price. One of your shopping centres, in Tsuen Wan, is due to be renovated: a food court will be converted into shops. Market research indicates that this will use the space more profitably. You must reduce costs and/or increase revenue urgently to make the company more profitable. You need to improve profitability by 50 currency units. A firm of consultants has suggested some possible savings in a report. This is summarised on the opposite page. Your objective: Decide how best to improve profitability by 50 currency units. Suggested meeting agenda: 1. Identify the key problem / issue: 2. Identify the ideal solution: 3. Establish the facts: 4. Identify the stakeholders: 5. Identify the available options: 6. Consider the advantages and disadvantages of these options: What is wrong? What would you like to see? What do you know? Who is affected? What could you do? What are the pros and cons? Who will gain? Who will lose? What is the best thing to do? 7. Decide on the best way forward: Key information Cost area Facilities management Marketing Consultants' recommendations Estimated contribution to profit (units) Delay renovation of Tsuen Wan mall 15 Raise rents on shop units 10 Raise parking fees 5 Delay upgrade of security equipment. 10 Reduce Christmas decoration budget.... 10 Delay redesign and upgrade of website 5 Reduce subcontracting costs for cleaning, security and maintenance. 10 units for each service Salary freeze 10 Reduce training budget ... 5 Reduce receivables (money owed by tenants) 10 Reduce dividend to shareholders ..5 Cheaper office premises 10 Save energy (lighting, air-conditioning) Operations Human resources Accounts Excerpts from emails you have received in reaction to the consultants' report from department heads at Mall Reit: Facilities Manager It would be a big mistake to delay renovating the Tsuen Wan mall. It will save money in the short run, but surely long-term profitability is more important? Raising rents is questionable when some of our units are already empty. And raising parking fees will just discourage people from coming Operations Manager It's very difficult to reduce expenditure on cleaning, security and maintenance immediately: we have agreements with subcontractors. The cleaning contract runs until March, and the security and maintenance contracts run until later next year. It's too late to reduce the Christmas decoration budget for this year: the money was spent a long time ago. We could do this for next year: we have to plan the budget months in advance. But I don't recommend it. It will make things worse. Marketing Manager HR Manager If we freeze salaries we'll lose staff. The training budget is vital. I think the figures for improving cash flow are exaggerated. Accounts Manager Context: You and your colleagues are members of the management team at MallReit, a medium-sized operator of shopping centres and car parks. Your own offices are located in rather crowded office space in Causeway Bay. You operate 6 shopping centres and their car parks in locations across Hong Kong. 93% of the shop units currently have tenants. Cleaning, security and maintenance services are all outsourced. You are a listed company, operating on a very tight profit margin. This has put pressure on dividends and affected your share price. One of your shopping centres, in Tsuen Wan, is due to be renovated: a food court will be converted into shops. Market research indicates that this will use the space more profitably. You must reduce costs and/or increase revenue urgently to make the company more profitable. You need to improve profitability by 50 currency units. A firm of consultants has suggested some possible savings in a report. This is summarised on the opposite page. Your objective: Decide how best to improve profitability by 50 currency units. Suggested meeting agenda: 1. Identify the key problem / issue: 2. Identify the ideal solution: 3. Establish the facts: 4. Identify the stakeholders: 5. Identify the available options: 6. Consider the advantages and disadvantages of these options: What is wrong? What would you like to see? What do you know? Who is affected? What could you do? What are the pros and cons? Who will gain? Who will lose? What is the best thing to do? 7. Decide on the best way forward: Key information Cost area Facilities management Marketing Consultants' recommendations Estimated contribution to profit (units) Delay renovation of Tsuen Wan mall 15 Raise rents on shop units 10 Raise parking fees 5 Delay upgrade of security equipment. 10 Reduce Christmas decoration budget.... 10 Delay redesign and upgrade of website 5 Reduce subcontracting costs for cleaning, security and maintenance. 10 units for each service Salary freeze 10 Reduce training budget ... 5 Reduce receivables (money owed by tenants) 10 Reduce dividend to shareholders ..5 Cheaper office premises 10 Save energy (lighting, air-conditioning) Operations Human resources Accounts Excerpts from emails you have received in reaction to the consultants' report from department heads at Mall Reit: Facilities Manager It would be a big mistake to delay renovating the Tsuen Wan mall. It will save money in the short run, but surely long-term profitability is more important? Raising rents is questionable when some of our units are already empty. And raising parking fees will just discourage people from coming Operations Manager It's very difficult to reduce expenditure on cleaning, security and maintenance immediately: we have agreements with subcontractors. The cleaning contract runs until March, and the security and maintenance contracts run until later next year. It's too late to reduce the Christmas decoration budget for this year: the money was spent a long time ago. We could do this for next year: we have to plan the budget months in advance. But I don't recommend it. It will make things worse. Marketing Manager HR Manager If we freeze salaries we'll lose staff. The training budget is vital. I think the figures for improving cash flow are exaggerated. Accounts Manager