Decision making implies a choice from among two or more alternative course of action. If a choice does not have to be made to solve a problem, an individual is not actually involved in a decision-making situation. For example, consider the manager who wants to determine when the office secretary left for lunch. This would not necessarily be a decision making situation since a choice may not be involved. Instead, the problem might be only a matter of obtaining the correct information. Decision making, however, could appear if the manager had to decide how to obtain the desired information. Basically, then, decision making and problem solving are not necessarily identical. As difined here, decision making is the process of choosing a course of action from among two or more possible alternatives in order to arrive at a solution for a given problem. As implied, decision making involves an evaluation of alternatives prior to the act of choosing the one to be implemented in response to a certain problem situation.
Decision making is so basic that no management function can be performed without it. For management purpose, decisions are obviously required in planning, organizing, actuating, and controlling. As shown in diagram, the decision making process is considered to be an activity inherent in all management functions.
For this reason, the process is not regarded as a function by itself nor is it synonymous with the process of managing.
As already noted, managers at all organizational levels make decisions, although they differ in type and scope. At the top levels of an organization, decisions establishing overall objectives and strategies are included among the most important to be made. Decisions of this type are not choices do not exist within a programmed format. Middle managers are generally more involved with decision making constrained by overall operating policies and plans. First-line supervisors, in turn, are concerned with short-range decisions that relate to specific activities to be carried out within the framework of policies and procedures established at middle management levels. Due to this integration of authority levels, the decision making process involves all managers in an organization and must be viewed as a total system of utmost importance to organization success.
Objectives and Decision Making
Objectives are the targets managers seek to achieve over various time periods. Generally, they are broad statements that serve as guides for action in determining the direction organizations will go and the activities they will follow. For example, the primary objective of Ralston Purina Company is to optimize the use of its resources and to produce short- and long-term profit growth consistent with balanced interest of customers, shareholders, employees, suppliers, and society at large.
To this extent, objectives themselves imply that a choice ha been made and future decisions will be required that contribute to the achievement of those objectives. Obviously, decisions cannot be made until it is determined where the organization is going and what is to be accomplished. To reiterate, objectives provide the focal point on which all decisions are based. They are the guides to the selection of alternatives that help assure their fulfillment. Thus, decision making is not an end in itself nor an isolated event but the means to the achievement of established goals.
Arriving at a decision implies that a manager has gone through a series of systematically related steps. basically, the steps. Basically, the steps of the decision-making process include (1) determining the problem as related to objectives being sought, (2) identifying alternative solutions, (3) analyzing the possible outcomes of each alternative, and (4) selecting an alternative for subsequent implementation. Pictorially, this process is shown in the next diagram. The Process is, however, more complex than the steps suggest since each step itself involves the decision making process. In essence, then, the decision maker does not go through the steps so systematically that decision making becomes a clearly defined, logical procedure. Managers are involved in a continuous flow of problems, many of which cannot be classified. At the same time, their attitudes toward risk may lead to choices that will be safe but not accomplish objectives as effectively as others. Thus, the importance of understanding, the decision process is not to justify result, but to be aware of the steps involved while recognizing the need to develop a healthy way of thinking about the numerous decisions that must be made in the day-to-day life of an organization.
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