Introduction of decision making
Discuss about the Changes of Decision Making In Business Environment.
Decision making is a significant element of management procedure and is entailed as an essential skill within an organization and other circumstance in which critical decisions are to be made. It is fundamental for accomplishing the success within an organization and in the personal life. There is a need of sufficient understanding, objectivity as well as commitment (Ryan, Bloom, Lowsky, Linthicum, Juday, Rosenblatt, and Sayles, 2014). Although, decision-making guide to success at the workplace but, it can lead to disappointment in case of inappropriate decision making along with, when there is misfit amid what is required to be performed and what has been completed. A dynamic, successful and proficient decision making within an organization entails the adequate understanding of oneself and the group, collecting information, assessing information as well as choosing and developing the plan. It is significant to emphasize on the internet and not on the situation as it would be beneficial to allow the mutual growth and recognition of the objective criteria (Austin, Mohottige, Sudore, Smith, and Hanson, 2015).
When I was working in a group then there was need of making productive as well as favorable decision mutually. A systematic strategy is necessary to make a decision as it would be beneficial to take decision confidentially along with there is no matter what kind of decisions has to be taken. The integration of self-assurance and competency to listen to others and learn from them is a basis to improve the ability of decision-making over a period of time (Cameron, and Green, 2015).
There are several decision-making techniques that can offer the unique benefits for particular judgment. The given below decision-making techniques can be practiced to enhance the decision making skill.
Simple Decision Matrix
Multiple criteria of decision analysis are a related method of Kepner-Tregoe Matrix and Grid Analysis. This tool facilitates a good negotiation amid intuition and analysis by practicing a methodical structure that assesses alternatives in against to a defined set of success criteria with the amendment of risk. This tool was developed by Dr. Benjamin B. Tregoe and Dr. Charles H. Kepner. It was published in “The Rational Manager” in the year of 1965 and become a foundational tool for making a decision in a business (Soltani, Hewage, Reza, and Sadiq, 2015).
Alternatives are compared against one another in pairs to develop the relative significance. A limitation of this tool is that little or no information is demonstrated that addresses the criteria supporting each option.
Select and evaluate the usefulness of a range of decision-making tools
Simple AHP Hierarchy Analytic Hierarchy Process (AHP)
It is an effective multiple criteria tool that practices paired comparison with additional mathematics in order to aid in identifying subjectivity and intuition that is natural in an individual decision-making tool. AHP technique was originally built by Dr. Thomas Saaty in the 1970s. This tool is frequently practiced in very multifaceted group decisions (Kerzner, and Kerzner, 2017).
This tool supports to visualize multistage decision issues while recognizing uncertain results. It could be beneficial to decide the strategies and opportunity of investment with the constrained resources (Mardani, Jusoh, and Zavadskas, 2015).
This technique is similar to Pro/Con/Fix (PCF), T-chart, Weighted Pro/Con, Force Field Analysis, and Plus/Minus/Interesting (PMI). This is the age-old strategy for identifying the pros and cons of two alternatives. A key limitation is that these decision-making tools address only two options at a time (Govindan, Rajendran, Sarkis, Murugesan, 2015).
The decision network in this model is a type of influence diagram in which influences are graphically demonstrated for decision circumstances. Influence diagram facilitates an option to decision trees that grow frequently with more variables (Robson, 2015).
Game theory facilitates potentially valuable decision-making tools for making a complex strategic judgment. This tool is beneficial to address the response of external participants such as competitors, government, and customers. This technique facilitates a potential precious decision-making tool. This approach entails the extensions in order to persuade the diagram. There is a limitation to simplify the assumption required to improve the decision and solve the game issue (Romiszowski, 2016).
This tool is practiced for group decision in order to choose moderately between different alternatives. It is best practiced in order to avoid lower priority choice before implementing a more meticulous tool to finalize a judgment on a smaller number of alternatives (Ingram, LaForge, Williams, and Schwepker Jr, 2015).
It is limited to financial judgments tool that can offer the information for assessing the financial criteria in other decision-making tools (Bower, Brownscombe, Birnie?Gauvin, Ford, Moraga, Pusiak, and Bennett, 2018).
Net present value and present value calculation are practiced for capital budgeting and decisions regarding investment. NPV is considered as a single criterion for making a decision (Haimes, 2015).
This tool is practiced to optimize the limited resources. This technique is a mathematical tool in which the requirements are demonstrated by linear equations. Useful issues in operations research can be identified by using this tool (Kabir, Sadiq, and Tesfamariam, 2014).
This tool is similar to the stated preference assessment, discrete choice, and choice modeling. A statistical tool is practiced in the market research. Furthermore, conjoint assessment is practiced for estimating the psychological tradeoffs that are made by customers for assessing the attributes and features of products and services. It could be also effective to forecast the consumer acceptance and determining the positioning of the market (Wallace, Salisbury, Guthrie, Lewis, Fahey, and Smith, 2015).
Various decision-making techniques that can enhance decision-making
This method is similar to the KJ method, which is used to identify the overload information by managing the different ideas. This tool is practiced as a part of brainstorming implementation (Morgan, Williams, Tracy, and McDonald, 2016).
This strategy is used as learning that provides the basis for making a decision from the childhood. The key limitation is that consequences of decision failure should be small and proper reflection must be demonstrated after the trial and error in order to make sure that an appropriate cause and effect relationships are identified in the learning (Hunink, Weinstein, Wittenberg, E., Drummond, Pliskin, Wong, and Glasziou, 2014).
These are trial and error decision making strategy that starts with a model which refines the ongoing experimentation. Although, this method is not more accurate but, this method uses a heuristics approach in order to decline the options and save the time in case of acceptance of approximation (Mardani, Jusoh, MD Nor, Khalifah, Zakwan, and Valipour, 2015).
This method is practiced for exploring the scientific questions. This problem-solving tool can be practiced for making the feasible decisions. An experiment is used to further confirm and develop the hypothesis. This tool can be used as a heuristic method (Tseng, and Hung, 2014).
When I was working in a previous organization then, I found that workshop on decision making and problem-solving are not only useful but also interesting. When I have graduation and find work in an organization on the position of Human Resource (HR) managers then, I have faced difficulties on regular basis. There was needed to make an accurate, intuitive and rational decision. I have to decide which person to hire, which supplier would use and which strategy will pursue. However, the competency to make a better judgment with existing information is essential. I also needed to comprehend the procedure of decision making and how one can try to avoid the biases while doing so (Shepherd, Williams, and Patzelt, 2015).
I have used cost-benefit analysis and decision tree decision-making style. Cost-benefit assessment is used by me to measures, address and involves all the favorable factors. These are the advantages for me. After that, I have measured, and subtract all the unfavorable expense. The difference between the two factors demonstrates whether the planned action is sensible. The key purpose of using the cost-benefit analysis is to ensure that I have included all the expenses and benefits and appropriately quantifies them (Siminoff, and Sandberg, 2015).
Affinity Diagrams
As the production manager, I have to purchase of $1 Million on a stamping machine in order to gain the output. Before presenting the proposal to vice president, I have understood certain facts in order to support the suggestion. In this way, I have decided to run the numbers and perform the cost-benefit assessment (Welford, 2016). I make a list of all the benefits. With the new machine, I have produced 100 more units per hour. The three employees have performed the stamping by hand. The unit will be of higher quality as they will be more uniform. I have persuaded the compensation costs. There was the high cost of purchasing the machine due to consuming more electricity. Any other expenses would be irrelevant (Laudon, and Laudon, 2015).
I have also measured the selling price of 100 additional units per hour multiplied by the quantity of production hour per month. I have also included two percent of the unit that is not rejected due to the quality of the machine output. I have also included the monthly salaries of three employees. It was good to measure total benefits. After that, I was able to calculate the monthly expenses of machines by dividing the buying price by 12 months per year and divide that by the 10 years. My manager assists me regarding the power of consumption of the machine as, I can measure the power cost amount from accounting. It enables me to figure out the cost of electricity in order to run the machine. I have also included the purchase expenses in order to obtain the total cost figures. I have also subtracted the total cost amount from the total benefit value and this analysis demonstrates a healthy profit (Bennett, and James, 2017).
Another technique that I have used in my organization in order to make a decision was decision tree. This technique shows the graphical representation of a possible alternative to a judgment as per some facts and conditions. This technique is known as decision tree as it starts with a single box, which then branches off into a number of solutions, just like a tree (Calabrese, Iandolo, Caputo, and Sarno, 2018).
Decision trees are effective, not only because they are graphics and aid me to see what an individual perceives but also, making a decision needs methodological and documented thought procedure. The biggest limitation of decision making is that I have to select from the known alternatives. Decision trees aids to formalize the brainstorming procedure so I can assess more potential alternative (Laudon, and Laudon, 2015).
Trial and Error
For example, I have made a decision tree for the cocktail party issue. This tree is a different way to exhibit the same data revealed in the payoff table.
When I was drawing a decision tree, I like to demonstrate the action and decision division with the square nodes and the possible event forks with round ones. Other symbols may also be practiced like single line and double line branches, colors and special letters. It does not matter that which method of distinguishing I have used and how many people I have employed. A decision tree of any size will always integrate the action alternatives, and distinguish possible events and results of an action that are partially influenced by options or other uncontrollable conditions (Laudon, and Laudon, 2015).
Decision making is one of the key aspects that were used by me in business organization and in the personal life. I made a decision at the right time and right place to make sure the success whereas sometimes, my wrong decisions can prove to because of failure of organization and failure at the personal level. All the aspect entailed in the particular circumstances should be involved before making any judgment. There are two models and one theory used by me such as a normative model, rationale model and rational action theory of Simon. These theories were beneficial for me to obtain the idea regarding the presence of constraint and assumptions in the decision-making process (Calabrese, Iandolo, Caputo, and Sarno, 2018).
Understanding of these models as well as theory gain my awareness regarding the concept of decision making and how judgment is made in the complex as well as critical conditions. I have also gained my experience regarding the concept of availability of biases like availability heuristics and decision biases. It was beneficial for me to assess the risk in the decision-making process. It can be assessed that through a formal search of circumstances and rational judgment aids me to evaluate the recent occurrence and action at the workplace (Mardani, Jusoh, MD Nor, Khalifah, Zakwan, and Valipour, 2015). Along with this, considering earlier action as well as an occurrence in the decision may give satisfactory outcomes both at the personal as well as organizational level. Hence, I have observed that the feasible understanding regarding theories, models, and aspects associated with decision making procedure can enhance the level of decision making and thus make an organization able to attain the targeted result. I was needed to understand the constraint and pool all the data associated with the circumstances to make good decision making. It could be effective to avoid the risk and ensures the success (Morgan, Williams, Tracy, and McDonald, 2016).
Heuristic Methods
I worked in the previous organization as an intern in the human resource department and my primary role was to aid the executive in their human resource activities, like selection, recruitment, creating performance sheets for employees, and making a checklist for identifying the performance of the workforce on the sheet. At the time of working in the previous organization, I gained my understanding towards many activities and methods as it is considered in the functioning and procedure of the HRD (human resource department). My superior has good understanding towards the procedure and function of HRD as it supports to solve my all query related to my roles and responsibilities in the organization (Kerzner, and Kerzner, 2017). In addition, it is also analyzed that I had accountability of doing various activities related to job evaluation like making spreadsheets, job description, job specification, salary sheet, and selecting a suitable person from the polled of applicants for the vacant position. I also realized that all activities cannot be possible without the help of my superior. I had to give my contribution to my manager to select a participant, which required to prior experience in the same area. I focused on making calls to targeted participants, appealing them to appear for the aptitude test, as well as undertaking an initial interview. One job participants clear the initial interview and selected for next round of interview (Soltani, Hewage, Reza, and Sadiq, 2015). He had approximately 1.6 years of experience but not the same field for which the job application was requested. I also observed that the candidate passed the first as well as the second round of interviews hence he was selected. I detected that the organization pays the appropriate amount of salary to the candidates caused by having good experience and knowledge. I was not capable to independently take decision for selecting any job candidates but I always involved in the whole process of decision making as I had to investigate about the condition with my manager towards the negotiation (Austin, Mohottige, Sudore, Smith, and Hanson, 2015). Moreover, I also addressed that appoint of participants decision for the required post at negotiable compensation did not show that higher outcomes. I also analyzed that if an employee did not perfume better in the working place unable to demonstrate the excellence of their allocated work (Govindan, Rajendran, Sarkis, and Murugesan, 2015). At the time assessment of newly selected workforces after few months, the manager did not ignore the fact that the employee performance was below expectation. In addition, it is also analyzed that the company did not recall the movement when the organization showed their good performance. The problem can be exposed to the availability heuristic. I also observed that if the manager takes a decision on their relationship with subordinates instead of focusing on actual performance then it creates the biases in the decision making. It could demonstrate the biases in the decision-making process as it would make a negative image of the manager in the employee’s mind (Romiszowski, 2016). The accessibility bias in the tendency of the individual to place their judgments on behalf of the data that is recently obtainable to them. I also learned that another managerial constraint on the decision making is related to the situation stated in the historical patterns (Morgan, Williams, Tracy, and McDonald, 2016). I gained my understanding towards the ways of selecting the job candidates for an appropriate position as it could support me to become an influencing manager in the upcoming period. In addition, I understood that how a manager could take an effective decision with respect to the different situation and obtain a positive response.
References
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