DECISION MAKING

What is Decision Making?

- “A decision is a judgment… a choice between alternatives.” (Drucker, 1966)
- “A decision making is the process of identifying problems and opportunities, then committing to a
certain action.” (“Managerial Decision Making” n.d.)
- “Decision making is the study of identifying and choosing alternatives based on the values and
preferences of the decision maker.” (Harris, 1980)
- “Decision making is a process that chooses a preferred option or a course of actions from among a
set of alternatives on the basis of given criteria or strategies.” (Wang, Wang, Patel, & Patel, 2004;
Wilson & Keil, 2001)
- “Decision making is both a managerial and organizational process.” (Leveriza, 1990)
- “Decision making is a cognitive process, it is the act of choosing between two or more courses of
action.” (“Decision making” n.d.)
- Decision making is a cognitive process that transcends all aspects which involves considering all
possible alternatives to come up with the best and most effective course of action.

Why are decisions so hard?

FOUR KEY AREAS THAT CAN DETERMINE THE RELATIVE DIFFICULTY OF DECISION:
- Structure
- Cognitive Limitations
- Uncertainty
- Alternative and Multiple Objectives

Who are the decision makers?

CLASSES OF DECISION MAKERS:
- Individual
- Multiple
- Group
- Team
- Organizational

Decision Making Styles

It is proposes that people differ along two dimensions in the way they approach decision making.
4 Styles of Decision Making:
- Directive: This form of decision making relies on a rational and autocratic style that results in the
employee using his own knowledge, experience and judgment to choose the best alternative.
- Analytic: It is a person with an analytic decision-making style has greater tolerance to ambiguity.
They are careful decision makers that like to be well informed and thoroughly assess their options.
- Conceptual: Conceptual decision makers are generally very broad in their approach and consider all
available alternatives. They are long-term oriented and are usually capable of formulating creative
solutions to problems.
- Behavioral: People with a behavioral decision-making style work well with others, are open to
suggestions, and are concerned about the achievements of their team. They generally try to avoid
conflict and place importance on their acceptance by others.

Approaches to the Decision Making Process

- Classical: Decision making is seen as a rational and logical process.
- Human Relations: Participation in the decision-making process is seen as an avenue for the
satisfaction of workers’ higher order needs.
- Human Resources: Participation in decision-making process is seen as an avenue for eliciting
valuable information from employees.
- Systems: Decision making is seen as a complex process involving multiple and varied stages.
- Cultural: Decision making is seen as a set of practices that reflect and constitute organizational
values and assumptions.
- Critical: Decision making is seen as a process through which management can exert control over
employees.

Individual and Organizational Decision Making

INDIVIDUAL DECISION MAKING:
- A planning or action made not more than one person. Individuals are biased towards making
decisions on a simplified sequential elimination process. The decision maker is the person itself.
- Examples include choosing what to eat for lunch, what dress to wear for the party, what college to
go to, and for what position to apply for.

ORGANIZATIONAL DECISION MAKING:

- In the organizational setting, managers are the key decision makers. Organizations have the ability to
incorporate a wide array of decision rules in the search process. Organizations and managers in
particular, have immense amounts of information and statistical software to track variances, trends
and make future projections of organizational growth.

STEPS IN MAKING DECISIONS: The Rational Model of Decision Making

- Define the problem.
- Diagnose the problem.
- Identify decision alternatives.
- Analyse alternatives.
- Select best alternatives.
- Implement alternatives.
- Evaluate.

PARTICIPATION IN DECISION MAKING

PARTICIPATIVE DECISION MAKING (PDM) is the extent to which employers allow or encourage
employees to share or participate in organizational decision making (Probst, 2005).

DECISION EFFECTIVENESS
Five-Step Process for better Decision-making:
- Score your organization
- Focus on key decision
- Make decisions work
- Build an organization
- Embed decision capabilities

IMPORTANCE OF DECISION MAKING

- Implementation of managerial function
- Persuasiveness of decision making
- Evaluation of managerial performance
- Helpful in planning and policies
- Selecting the best alternatives
- Successful operation of business

REFERENCES
- Leveriza, Jose. “Public Administration”. National Bookstore
- Marakas, George M. “Decision Supports Systems in the 21st Century”, Prentice Hall International
- Miller, Katherine M. “Organizational and Communication Approaches and Process”, Wadsworth
Publishing Company
- Slack, Trevor C. “Understanding Sport Organization” Prentice Hall International
- Additional sources from educational and professional websites.