Compilation on Decision Making

Topics: Decision theory, Decision making, Risk Pages: 11 (3668 words) Published: May 8, 2012
I hereby declare that this document is the result of my own efforts and that it confirms to the university, departmental and course regulations regarding cheating and plagiarism. No material contained within this project has been used in any other submission, by the author, for an academic award.

Noella. Fernandes

What is Decision Making?5
Types of Decision making –5
Approaches of Decision making6
Decision Making based on Uncertainty9
Decision Making Model11
Rational Decision Making Model –11
The Six-Step Rational Decision-Making Model –11
Case Study12
McDonald’s case study –12
Project Management14

Quoting one of the most famous and beloved American poet named Robert Frost, as he said, “Two roads diverged in wood –and I? I took the one less traveled by, and that has made all the difference.” When he said that he took the road less traveled by, just what did Frost mean by it? Every individual makes decisions based on varying importance everyday of their life. In fact, every action in our daily lives and in our workplace is a decision in itself and very often it is the process or action in our life that we mostly overlook and give minimum importance to, unless it is a difficult choice or scenario that we land ourselves in. They are these big and small decisions in our life that define our character, personality and a lot more, and it is these that shape our life. (Gib, 2009) The importance of decision making and problem solving is a very important skill for business and in life. Often decision making and problem solving are both considered to be the same, but problem solving mainly involves decision making and it is decision making that is a challenge and more significant, vital and crucial for managers and leaders. Decision making comes naturally to some personalities, hence leaving them to focus more on improving their skill of decision making. Whereas, there are those few who are good at making quality assessments and lack the trait of decision making, it is these few who need to sharpen their skills and to help them do so there are procedures and methods to help learn and improve decision making skills and its quality. (Source – ; accessed on 26/01/2011 at 0835am) The importance of decision making in management is not just about running and taking care of a smooth business or corporation. It is a wide or more rightly a vast concept concerning and relating to every corner that we are a part of, extending from the self and expanding through family, community and other surrounding factors. Decision making initiates through personal management skills. This further branches out into the innovative designing of an effective strategy and its execution. Being part of a management it is very important that decisions are made very carefully, as it at times directly or indirectly affects the employees morale and performance hence finally boiling down to playing a vital role in influencing the overall business performance. The importance of decision making in management is immense as business policy and culture adopted, ultimately affects a company's output and performance. (Pilgrim, 2010)

What is Decision Making?
A decision is made when one needs a solutions to a problem to be selected for implementation. Decisions can be made in 2 ways –formally or informally – * Formal decisions are relatively compound, have no fixed routine and are generally non repetitive. Policies, procedures, criteria, and methods for making such decisions may not always exist since the problem faced may lack precedent. Creativity may play a key role in such decisions. * Informal decisions are more repetitive and routine in nature. Policies, procedures, criteria, and methods often exist to assist managers in making such decisions. Decision-making is the process of...

Bibliography: Journals –
* S. French and D. Rioos Insua (p. 7). (2000), Statistical Decision Theory. Oxford University Press Inc., New York.
* D. Bell, H. Raiffa and A. Tversky. (ed.) (1988), Decision making - Descriptive, normative and prescriptive interactions. Cambridge University Press
Web –
* Gib.A (2009); The Importance of Decision Making; ; published on -20/04/2009 at 10:02:07; accessed on -26/01/2011 at 08:12
* ; accessed on 26/01/2011 at 0835am
* Pilgrim.G (2010); Importance of Decision Making; ; published on -8/5/2010 at 11:40; accessed on 25/01/2011 at 11:41am
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