Developing people through decision-making
A npower case study

Page 1: Introduction

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RWE npower is a leading energy company in the UK. It is part of the German-owned RWE, one of Europe's leading utilities. Part of RWE's strategy is to deliver cleaner, affordable, secure energy supplies for the UK while improving profitability. RWE npower has over 11,000 employees across 60 sites in the UK. It provides more than 10% of all electricity in England and Wales. In the UK, RWE...
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Page 2: The decision-making process

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Businesses need to make decisions for different reasons:  All decisions have some degree of risk involved. For example, choosing the colour of paint for the office walls carries much less risk (and cost) than choosing the site of a new office. Decisions may be strategic, tactical or operational. These relate to levels in the organisation.  An organisation's structure affects how...
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Page 3: Strategic decisions

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Strategic decisions are those which affect the long term performance of the business and which relate directly to its aims and objectives. They are usually taken at the highest levels of management and carry higher levels of risk. However, effective strategic decisions bring high levels of reward. The strategic decision to undertake the 'Strategic Spare Parts Project' was taken by directors...
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Page 4: Tactical decisions

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Tactical decisions are medium term decisions. Whereas a misguided strategy could take a business in entirely the wrong direction and lead to failure, a misguided tactic would have a more limited impact. Strategies are usually in place for a long period of time; tactics tend to be more changeable. The leaders of the Spares project created a strategy for managing spares, based on categorising...
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Page 5: Operational decisions

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Operational decisions occur on a daily basis and are made considering the risk to the business. Often these decisions are administrative in nature and can be implemented quickly and tend to carry little risk. At RWE npower, employees at every level take operational decisions daily. An example might be when to re-order a particular item of stock. Another could be to determine how many operative...
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Page 6: Conclusion

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All decision-making involves elements of risk and reward. For every decision there are risks. Many organisations are structured so that major decisions are taken at the highest levels. This is because decisions at the top can have major effects for the whole organisation. At the tactical and operational levels, the risks are smaller. At RWE npower, people at all levels are encouraged and...
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