402225 Decision Making
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Decision-making is an essential function of management. Decision-making is the method or process by which we evaluate alternative and make a choice among them. The choice of alternative is called decision. The decision may be routine these are made by Field Sales Manager and are governed by the policies, procedures and rules of the organization as well as personal habits of the manager's. In reality actual moment of decision cannot be studied and some time you are not even conscious about it. Decision-making implies choice from several or many possibilities. Decision-making implies action and change. Approaches to decision-making: there are two basic approaches to make a decision a) By intuition, b) By research (scientific method)
By intuition: The individual who relies on intuition makes his decision based on accumulated experience. Intuition is acquired through experience and accomplishment rather than through a formal decision mankind process. Experience tends to be a good teacher. Decision-making who realizes only intuition bases a judgment on his feelings of the situations. If the decision maker confront a situation to which he has not been previously exposed a wrong decision often results. It has a lot of short coming;
 Learning from experience is random.
 Condition changes and an experience may no longer be good.
 Do you have twenty years of experience or one year of experience twenty times?
 There is no grantee that we learn from experience.
 What we learn from experience is not necessarily circumscribed by the limits of our experience.
By research: This is a systematic formal approach to decision-making. It stresses that the scientific method should be used in problem solving. It has:
1) Observation events
4) Experimentation and verification
Observer an occurrence and ask why it happened. Hypothesis is an explanation of the cause that brought about the observed effect. Experimentation, this is subjecting the hypothesis to one or series of tests to determine whether or not the tentatively stated relationship does in fact exist i.e. test confirm or support of hypothesis or prove it to be unfounded. Verification confirms the findings obtained from the experiment.
Making any decision you can identify the following steps.
1. Identify the problem, which you need to solve.
2. Find out the facts.
3. Try to find out some solution.
4. Narrow the choice of alternative.
5. Take the decision,
6. Implement the decision.
The process of arriving at any decision is usually referred to problem solving. Before solve any problem you can go after the following steps.
1. Recognize that there is a problem
2. Analyze the cause or state the problem
3. Evaluate the alternative
4. Choose the best decision
“You can't solve a problem until you recognize that a problem exists”.
1) Recognize a problem.
If want to take any decision then you have to recognize or identify the nature of the problem first and also verify that the problem is genuine or not. Some time it may happen that MR's are highlighting some problems to convert your attention from the main cause.
Also some time FSM spending lot time to solve the problem, which is someone else's responsibility at the same time FSM refers a problem upwards to his boss, in spite of having full authority to take decision.
2) Analyze the cause or state the problem.
Analyze the causes of the problem is very important, as getting it wrong can easily lead to a wrong decision. Instant diagnosis is to be avoided: be sure to find out the basic cause of the problem.
The whole process of analysis is best appreciated by considering the example of a doctor. What doctor is doing before writing any medicine he is writing case history of the patient to come to a solution to give relief to his patient? Without a doubt, a good explanation of a problem is often a sufficient diagnosis in any situation.
How to get a good clarification of a problem;
o Write down the problem
o Turn into language you can understand
o Get a good information system
o Avoid classifying the problem too soon (e.g. as a team or group related problem or marketing problem, this are risky assessment to make early decision)
o Ask questions such as what cause such and such to happen? Why did it happen? Etc.
3) Evaluate the alternative.
This particular step you have to use your brain, you have to do lot of thinking, which you may or may not enjoy depending on the nature of the problem. Unfortunately FSM's have no choice they have to solve the problem they are set, whether they like them or not. So the first thing to be sure about is that, to be an effective manager you will have to do some difficult thinking from time to time. Develop a solution for any problem you have to generate some ideas. When you have generated some ideas then you have to find out the best idea for any particular situation to solve the problem. In looking for possible solutions to problems, remember two other things. First, someone else may well have faced the problem and can remember how he solved it. Second, people are often willing to give advice. The role of adviser is well established and still common in pharmacy industry. As a FSM you can rely on your own skill, knowledge and experience or you can ask for advice. Furthermore you are still responsible for the decision in the end.
4) Choose the best decision.
Choose and implement the best decision, fear of making the wrong decision sometimes causes the FSM to make no decision at all. It is in this stage that weak managers sometimes fail. It is no wonder high salaries are afforded to managers who have gained a reputation for not only having the internal strength to make decision but also for making the correct ones, the majority of the time. Some managers because they are action oriented believe that once the decision has been making it will automatically be implied. A good manager monitors the situation to ensure that decision is accomplished.
No decision making process to complete until the decision has been exposed to the realities of the actual business environment. Implementation requires an objective assessment of how the decision has solved the problem. It is the process by which the FSM learns and develops useful experience.
All of us making decision all the time, without consciously doing so because we do not need to evaluate the alternatives each time
Implementation turns the decision in to action; it is the step that makes something actually happens. In the same way a managerial decision either has to be acted on by the manager him-self or he has to communicate others for action. A decision often means a change and need handle with care. Whenever you make a managerial decision implement it immediately otherwise it has got no meaning. Late implementation of decision may cause problem only. An essential ingredient in the planning process is the allowance of adequate time between the decision and the event itself.
Decisions are made every single second of the day by many different people all over the world. But of all those decisions, how many of them are actually 'good' decisions? This is a question that most of us hardly ever think about because we have been faced with many problems/situations and making decisions to most of them without much thought all of our lives. A lot of times we don't question our decisions unless the outcome is unfavorable, but even when it is favorable; it does not always mean the best decision was made. Unfortunately, this is exactly why most of our decisions are not really 'good' decisions. When an individual is in a situation where a decision must be made, how does that person go about deciding what their decision is going to be? Do they know what the real problem is? Have they determined the true objective of their decision problem? Are they aware of the consequences of each choice they have to decide from? These are only a handful of questions that need to be addressed when faced with a situation or predicament where a decision must be made. Some of them may be addressed during the decision making process, but for the most part, there are so many more that are not. Decision-making is a long detailed process that requires a lot of thought and analysis before a decision can be made.
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