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Decision Making

Decision making is the process of selecting the best option from multiple alternatives to achieve specific objectives, and is fundamental to managerial activities. It involves a sequential process of identifying problems, gathering information, evaluating options, and implementing chosen actions. The nature of decision making is characterized by its intellectual, purposeful, and social aspects, influenced by environmental conditions.

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4 views

Decision Making

Decision making is the process of selecting the best option from multiple alternatives to achieve specific objectives, and is fundamental to managerial activities. It involves a sequential process of identifying problems, gathering information, evaluating options, and implementing chosen actions. The nature of decision making is characterized by its intellectual, purposeful, and social aspects, influenced by environmental conditions.

Uploaded by

imabhayverma2408
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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NOTES

TOPIC:- DECISION MAKING


UNIT 2
SUBJECT:- FUNDAMENTAL OF MANAGEMENT
BCA 1ST SEM

DECISION MAKING MEANING.


Decision making is a process of choosing or selecting any
one option out of several options to achieve some
Objectives.
The decision making is the basic and fundamental key of all
managerial activities. It is the study of identifying and choosing
best possible choice (or option) based on the values and
preferences of the business.
DEFINITIONS
• Philip Kotler: “A decision may be defined as a conscious choice
among alternative courses of action.”
• Peter F. Ducker: “Whatever a manager does he does through
making decisions.”
• E. Mc. Farland: “A decision is an act of choice wherein an
executive forms a conclusion about what must be done in a given
situation. A decision represents a behavior chosen from a number
of possible alternatives.”
• George R. Terry: “Decision making is the selection based on
some criteria from two or more possible alternatives.”
• Koontz & O’Donnel: “Decision is the selection from among
alternatives of a course of actions.”
• Franklin G. Moore: “Decision making is the blend of thinking,
deciding and acting.”

NATURE OF DECISION MAKING


1. It is a process:- Decision making is a process. It
is not a fixed process but it is a sequential
process. This process involves the searching,
evaluating and choosing a course of action from
among available alternatives.
2. Intellectual and logical process:- It is a
intellectual and logical process. It requires
creativity, imagination and deep understanding of
human behaviour.
3. Human and social process:- It is affected by
the sentiments, values and intuitions of human
being.
4. Purposeful:- It aims at attaining some Objectives
in a given situation.
5. Solves problem:- All decisions are directed to
solve some problem. However, over a period of
time they give rise to a number of other
problems.
6. Deciding to do or not to do:- Decision making
involves deciding to do or not to do something.

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Therefore, if a decision maker decides to
postpone a decision for future is a decision.
7. Environmental influence:- Decision making
process is influenced by the environment
conditions.
8. Pervasive activity:- Decision making is all
pervasive. All the Entrepreneur make decisions
regardless of their level in the business.

DECISION MAKING PROCESS

Making decision which are timely and which are based on


careful analysis of various information is critical to our
success. Decision making is a habit as well as a process.
• Identify the problem:- In this step, the problem is thoroughly
analysed. There are a couple of questions one should ask
when it comes to identifying the purpose of the decision.
• What exactly is the problem?
• Why the problem should be solved?
• Who are the affected parties of the problem?
• Does the problem have a deadline or a specific time-line?

• Gather relevant information


Collect some pertinent information before you make your
decision: what information is needed, the best sources of
information, and how to get it. This step involves both internal and

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external “work.” Some information is internal: you’ll seek it through
a process of self-assessment. Other information is external: you’ll
find it online, in books, from other people, and from other sources.
• Identify the options

We need to identify clearly all the available alternative options,


paths or actions for the decision to be made.

• Evaluate the evidence

Evaluating all the options with their pros and cons needs to be
carried out

• Choose among alternatives

Choose the best alternative based on the above careful analysis


of all the alternatives.

• Implement the chosen alternative

Implement the actions associated with the alternative path or


option being selected.

• Analyse the results

We need to analyse the outcome achieved after the


implementation of the actions selected in the above step.

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