Decision Making 1

Running Head: Decision Making

Management Decision making

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Management Decision making

Management is all about effective decision making. Decision making is one of the vital

aspects of the functions of a manager in an organization. Along with the other roles like monitor,

figure head and leader, an efficient manager is expected to take right decisions at suitable time

with minimum resources. Borcherding et al (2000) presents that the collecting, monitoring,

classifying, analyzing, and reporting relevant information to concerned departments is the core

managerial job. In these rapidly changing scenarios of latest technology and fastest

communication, prompt decisions in business are needed to survive in immense completion.

Management decision making skill, based on knowledge and experience, is vital to come up with

correct decisions in difficult situations.

The core functions of a manager are to plan, organize, lead, and control at three levels of

the business. These levels are corporate, business, and operational; depend on the size and nature

of the organization. Top management is making strategic decisions at corporate levels, middle

management take short term tactical decisions, and line managers are responsible for day to day

operational decisions. Nutt (1984) put forward another important aspect in decision making,

‘centralization and decentralization’. The authority and application of decisions are largely

dependent on the type of organization (445).

Decision making always involve an inherent risk of time, output, resources, and capital.

We cannot eliminate them but can be reduced them by using an effective decision making

system. According to Pennings (1996), a ‘systematic decision making approach’ should be used

to make effective decisions quickly. This process involved the following stages:
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 Set the priorities, objectives, and structure for the organization.

 Identify the issue/s at hand to analyze.

 Gather data to identify all possible causes of the problem.

 Search and classify the list of possible alternatives.

 Select the best possible alternative available.

 Efficiently implement the chosen outcome.

 Feed back collection and analyses to measure the effectiveness of decision made.

All the above listed steps are interconnected and follow a specific management

philosophy, to achieve the desired goal by utilizing minimum resources effectively. Rodrigues,

(2001) argued the implications of this process in large organizations, and demands horizontal

hierarchies with decentralized decision making for more proactive and dynamic organizations.

Some vital consideration should be kept in mind in following these steps. In general, Lilien et

al (2002) supposed that managers need to consider right selections in making decisions, like

clear understanding of the problem to be solved demands a clear context of the issue with the

desired goal of decision. Also, efficient information collection should be through proper

research and reliable sources. Personal biases and other inclinations need to be avoided in

selecting alternatives. Huff (1990) explained that innate or ‘investigative cognitive preference’

helps in this regard. Implementation and feedback receiving too require great care and

visionary approaches from managers.

Finally, it is evident that decision making is an important task and a necessary skill to

achieve personal and organizational goals. These decisions vary from day to day issues to long

term corporate decisions, but their approach always remain of sensitive nature, as the affect the
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present and past of an organization. Sometimes, there is not enough time to follow a systematic

approach, so intuitive decision making supports the process. A successful manager always

equipped with latest tools, visionary approach, and an effective intuition to survive in complex

business world.
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References

Borcherding, K., Larichev, O. I., & Messick, D. M. (Ed.). (2000). Contemporary Issues in

Decision Making. Amsterdam: North-Holland.

Huff, A. S. (Ed.). (1990). Mapping Strategic Thought. Chicester: John Wiley & Sons.

Lilien, G. L., Kotler, P., & Moorthy, K. S. (2002). Marketing Models (5th ed.). New Jersey:

Prentice-Hall.

Nutt, P. (1984). Types of Organizational Decision Processes. Administrative Science Quarterly,

29(3), 414-50.

Pennings, J. M. (Ed.). (1996). Decision Making: An Organizational Behavior Approach. New

York: Markus Wiener Publishing.

Rodrigues, C. A. (2001). Improving decision making processes. San Francisco, CA: Jossey-Bass.