What is Decision Making?
Decision-making is the process of selecting the best course of action out of many available alternatives. It is a managerial function to solve organizational problems by choosing a specific course of action or plan.
Decision making is an essential function of management. It is a rational and scientific method of choosing the best option. Every organization runs by operating decisions. In present made decisions define how will be the organization in the future.
It is also known as the heart of the management. It helps in identifying and defining problems, developing alternative solutions, evaluating them in terms of possible consequences and choosing the best solution among them, and implementing the decisions effectively. Because it is necessary to operate an organization smoothly and effectively to achieve defined objectives and goals.
During the life of an organization, many situations and problems may arise in the functional areas of the organization. These problems create obstruction and disturbance in the performance of the organization. The manager needs to solve these problems in the best possible way considering organizational interests and objectives. Therefore a manager has to continuously involve in the decision-making process while setting goals, determining plans and taking actions, formulating strategies and policies, assigning jobs to subordinates, and evaluating their performance. So, it is a continuous function of a manager to achieve organizational goals.
The success of an organization depends upon the decision making ability of the manager and its implementation in the practical field.
Definition of Decision Making
Many scholars have provided their ideas and views on defining the decision making in different ways. Lets take a look on it,
According to “George R. Terry” – Decision making is the selection based on some criteria from two or more possible alternatives.
Koontz and Weihrich – Decision making is defined as the selection of course of action among available alternatives.
Joseph L. Massie – A decision is a course of action consciously chosen from the relevant alternative for the purpose of achieving desired goals.
Ivancevich, Donnelly, and Gibson – Decision is the process of thought and deliberation which results in a decision to achieve some desired state.
Considering the above ideas and views, it can be concluded that decision making is the process of solving organizational problems by choosing a specific alternative among various alternatives. While choosing the alternative there must be consideration of some criteria defined by the organization.
7 Important Nature/Features of Decision Making
7 good characteristics/natures/features are:
- Selective Process
- Human and Rational Process
- Dynamic Process
- Goal Oriented Process
- Continuous Process
- Freedom to Decision Maker
- Positive or Negative Impact
Feature #1 Selective Process
Decision-making is the process of selecting a course of action among many alternatives to solve problems. A manager has to consider various factors before selecting a course of action. These factors may involve the capacity to implement the action, organization nature, existing work environment, objectives of the organization, time factors, and so on.
Feature #2 Human and Rational Process
It is a human and rational process and needed all types of organizations. A manager has to make mental exercises to study the impact of the course of action before making a decision.
A manager has to invest his personal skills, experience, knowledge, and capability to study the alternatives from many angles. Hence, it is common in every organization.
Feature #3 Dynamic Process
While making a decision it is essential to consider the time factor and existing environment, wherever a course of action is taken.
A manager has to take decisions at the right time for its effectiveness. Besides, he as to consider future environments, which may affect future activities. Therefore, it is not a static but dynamic process of management.
Feature #4 Goal Oriented Process
Without any goal made decision seems unrealistic. It focuses on the organizational objectives. Many problems arise in an organization during its courses.
The manager has to solve all the problems in proper time and also in a proper manner by considering organizational goals. Thus, the right decision at right time contributes to achieving the predetermined objectives within the defined time and standard.
Feature #5 Continuous Process
Decision making is the continuous process till the existence of the organization. In the course of regular performance, many problems may arise at different times and situations. Managers have to solve those problems in proper time so that the organizational performance be smooth.
Feature #6 Freedom to Decision Maker
Managers have the freedom to take any kind of decisions. As chief of the organization, a manager takes any course of action to solve a problem by using his own logic, idea, knowledge, and experience. But while taking any course of action he has to consider the organizational objectives.
Feature #7 Positive or Negative Impact
A course of action may either have a positive or negative impact on organizational performance. A manager has to consider as far as possible the positive impact of the action before coming to a conclusion.
For this, the manager has to make a detailed study of the positive as well as negative impacts of the course of action. Further, he has to take a decision to select a course of action where a positive impact prevails more than a negative impact.
Decision Making Process
As it is a continuous and dynamic process. Before making a decision every manager has to go through a series of steps. The important seven steps are:
- Identification of Problems
- Analysis of Problems
- Development of Alternatives
- Evaluation of Alternatives
- Selection of Best Alternative
- Implementation of Alterntives
- Review the Implementation