Fundamentals of Decision Making
This chapter has examined the
fundamentals of decision making. The decision-making process consists of: (a)
identifying the problem (b) diagnosing the situation, (c) collecting and
analyzing data relevant to the issue, (d) ascertaining solutions that may be
used in solving the problem, (e) analyzing these alternative solutions, (f)
selecting the one that appears most likely to solve the problem, and (g)
implementing it. Yet the decision making process is much more than simply
following a list of steps; a great deal of subjective as well as objective
evaluation must take place. For example, the personal values of the top manager
will play a significant role in the assignment of risk and uncertainty
probabilities. In many cases even modern managerial decision making may well be
75 percent subjective, 25 percent objective.
Nevertheless the manager must be as
rational as possible, drawing upon all available techniques and guidelines in
choosing among the various alternatives Some of the techniques that are most
useful in this process include the Laplace criterion, the maximin criterion,
the maximize criterion marginal analysis financial analysis, and the Delphi
technique. And these represent only a few of the techniques available to the
modern manager Modern decision making is notable for the great variety of
decision-making aids it has discovered.
The last part of the chapter examined
creativity and decision making, creative thinking has four stages: preparation,
incubation, illumination, an d verification There are a number of techniques
that can be used to help stimulate creative thinking. Two of the most popular
are brainstorming and the Gordon technique. Recent interest has also been
generated in the area of whole,brain thinking: teaching managers to use both
sides of their brain Left,brain thinkers are being taught to be more creative;
right-brain thinkers are being shown how to approach problem solving more
logically an d sequentially, This latter area is extremely important in
decision making and is the focus of attention in the next chapter.
