Decision making process as explained by different authors in entrepreneurship and communication studies
What is Decision Making?
1. Decision making is the study of identifying and choosing alternatives based on the values
and preferences of the decision maker.
Making a decision implies that there are alternative choices to be considered, and in such a case
we want not only to identify as many of these alternatives as possible but to choose the one that
(1) has the highest probability of success or effectiveness and (2) best fits with our goals, desires,
lifestyle, values, and so on. The two important ideas here are that first, there must be some
genuine alternatives to choose from among. Note that "Do it" or "Don't do it" does not qualify as
a set of alternatives. Only "Do this" or "Do something else" really qualifies. Second, every
decision must be made in the light of some standard of judgment. This standard usually gets
expressed in the form of criteria, which reflect the values and preferences of the decision maker.
These values and preferences are often influenced by corporate rules or culture, law, best
practices, and so forth.
2. Decision making is the process of sufficiently reducing uncertainty and doubt about
alternatives to allow a reasonable choice to be made from among them. This definition
stresses the information-gathering function of decision making. It should be noted here that
uncertainty is reduced rather than eliminated. Very few decisions are made with absolute
certainty because complete knowledge about all the alternatives is seldom possible. Thus, every
decision involves a certain amount of risk. If there is no uncertainty, you do not have a decision;
you have an algorithm--a set of steps or a recipe that is followed to bring about a fixed result.
Quite literally, organizations operate by people making decisions. A manager plans, organizes,
staffs, leads, and controls her team by executing decisions. The effectiveness and quality of those
decisions determine how successful a manager will be.
Managers are constantly called upon to make decisions in order to solve problems. Decision
making and problem solving are ongoing processes of evaluating situations or problems,
considering alternatives, making choices, and following them up with the necessary actions.
Sometimes the decision?making process is extremely short, and mental reflection is essentially
instantaneous. In other situations, the process can drag on for weeks or even months. The entire
decision?making process is dependent upon the right information being available to the right
people at the right times.
Decision Making Process
The decision?making process involves the following steps:
1. Define the problem.
2. Identify limiting factors.
3. Develop potential alternatives.
4. Analyze the alternatives.
5. Select the best alternative.
6. Implement the decision.
7. Establish a control and evaluation system.
Define the problem
The decision?making process begins when a manager identifies the real problem. The accurate
definition of the problem affects all the steps that follow; if the problem is inaccurately defined,
every step in the decision?making process will be based on an incorrect starting point. One way
that a manager can help determine the true problem in a situation is by identifying the problem
separately from its symptoms.
Concentrate on the problem at hand. This rule keeps the discussion very specific and avoids
the group's tendency to address the events leading up to the current problem.
Entertain all ideas. In fact, the more ideas that come up, the better. In other words, there are no
bad ideas. Encouragement of the group to freely offer all thoughts on the subject is important.
Participants should be encouraged to present ideas no matter how ridiculous they seem, because
such ideas may spark a creative thought on the part of someone else.
Refrain from allowing members to evaluate others' ideas on the spot. All judgments should
be deferred until all thoughts are presented, and the group concurs on the best ideas.
Factors Affecting Decision Making
Perception Issues ? perception can be described as the way in which individuals interpret
their environment. An individual?s perception can influence how they make decisions and
solve problems. For example, when information about a problem needs to be gathered the
individual?s perception will impact on where the information is sought and the type of
information regarded as relevant.
Issues within the organization
A number of organizational issues can impact on the decision making process. These
issues include: policies and procedures, organizational hierarchy and organizational
Issues within the environment
Environmental issues are the external factors that affect the organization. The types of external
factors that can have an effect on decision making: the market in which the organization
operations, the economy, government legislation, customers? reaction to the organization?s
products and services
Common Decision making mistakes
Only hearing and seeing what we want. Each individual has their own unique set of
preferences or biases which blinker them to certain information. The best way to deal
with this problem is to identify your preferences and biases while attempting to be open
to the information around you.
Placing too great a reliance on the information you receive from others. Often we rely on
certain individuals to provide support and guidance. This may be a suitable course of
action in many cases. However, if the individual is not closely involved in the problem
situation they may not have the necessary information or knowledge to help make the
Placing too little emphasis on the information you receive from others. This issue can
easily occur in a team situation. In many cases the team members are the people who are
most closely involved in a problem situation and they often have the most pertinent
information in relation to the problem.
Ignoring your intuition. On many occasions we are actually aware at a subconscious level
of the correct course of action. Unfortunately, we often tend to ignore our intuition or gut
feeling, the sixth sense or whatever we may choose to call it.
Decision Making Levels
Operational decisions are the day-to-day decisions needed to operate the organization.
Operational decisions are more routine and follow known rules. How many? To what
specification? These decisions involve more limited resources, have a shorter-term application
and can be taken by middle or first line managers.
Tactical decisions, on the other hand, are those decisions that involve formulating and
implementing policies for the organization. Tactical decisions are about how to manage
performance to achieve the strategy. What resources are needed? What is the timescale? These
decisions are distinctive but within clearer boundaries. They may involve significant resources,
have medium-term implications and may be taken by senior or middle managers.
Strategic decisions are made by top managers and involve setting long-term organizational
goals and objectives. Strategic decisions are big choices of identity and direction. Who are we?
Where are we heading? These decisions are often complex and multi-dimensional. They may
involve large sums of money, have a long-term impact and are usually taken by senior
management.Strategic decisions affect the business direction of a company and help determine
what markets to play in and how. Because of the long-term effects, these types of decisions are
made less frequently, in some cases every five to ten years. The decision to get out of the
clothing business and sell outdoor sports equipment instead is a strategic decision with long-term
consequences. Strategic decisions are generally unstructured. There are few foolproof procedures
for determining corporate strategy and deciding what business to be in.
This question was answered on: Sep 18, 2020
Buy this answer for only: $15
This attachment is locked
We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free copy from our tutoring website www.aceyourhomework.com (Deadline assured. Flexible pricing. TurnItIn Report provided)
Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
About this QuestionSTATUS
Sep 18, 2020EXPERT
GET INSTANT HELP/h4>
We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.
You can also use these solutions:
- As a reference for in-depth understanding of the subject.
- As a source of ideas / reasoning for your own research (if properly referenced)
- For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
NEW ASSIGNMENT HELP?
Order New Solution. Quick Turnaround
Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.
WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN YOUR SET DEADLINE.