Decision making.....

Decision Making Defined
Decision making is about identifying and choosing alternatives based on the values and preferences of the decision maker.
Decision making is the process of sufficiently reducing uncertainty and doubt about alternatives to allow a reasonable choice to be made from among them.
Business and Life Management Function
Decision making is an important step in the "planning" function of business management.
It is also a part of everyone's daily living.
Decision Making Processes (Models)
Herbert A Simon Model
Major three phases:
Intelligence: Searching the environment for conditions calling for decisions.
Design: Inventing, developing and analyzing possible courses of action. Creating alternative solutions.
Choice: Selecting an alternative or course of action from e ones designed. Choice is made and implemented.
Extended Model
It goes beyond making the choice.
Recognition of problem or need for decision.
Analysis and statement of alternatives.
Choice among the alternatives.
Communication and implementation of decision.
Follow-up and feedback of results of decisions.
Principle of Limiting Factor
Limiting factors stand in the way of accomplishing a desired objective. If these factors are clearly recognized, managers will confine their search for alternatives to those, which will overcome the limiting factors.
For example, for turning around a manufacturing organization, the means could be to acquire some capital equipment. Then, limiting factor could be cash and credit. Consequently, the manager's alternatives would be confined to those, which would overcome these limiting factors.
Knowledge of Outcomes
Certainty: Complete and accurate knowledge of outcome of each alternative. There is only one outcome for each alternative.
Risk: Multiple possible outcomes of each alternative can be identified and a probability of occurrence can be attached to each.
Uncertainty: Multiple outcomes for each alternative can be identified but there is no knowledge of the probability to be attached to each.
Satisficing: More Often Used Decision Making Strategy
Many people choose the first satisfactory alternative rather than the best alternative. If one is very hungry, one might choose to stop at the first decent looking restaurant rather than attempting to choose the best restaurant from among all (the optimizing strategy). The word satisficing was coined by combining satisfactory and sufficient. For many small decisions, such as where to park, what to drink, which pencil to use, what to wear and so on, the satisficing strategy is pretty decent.
Important Tip for Decision Making
Do not start unless you have one more alternative to choose from.