Decision Making in Business

DECISION MAKING IN BUSINESS

Decision-making is the process of recognizing a problem or even an opportunity and choosing amongst a collection of well thought alternatives as a course of action to the situation (textbook). Decision –making should be quite a familiar term now as its continued importance cannot be stressed enough especially in todays markets in which managers have to continuously make strategic decisions in relation to both threats and opportunities in their industries when their organizations might either be performing excellently or below par in either of the four stages of the business cycle; Boom, Downturn, Recession or recovery

Decision-making is a vast area of concern to business as an entity and business in the area of study. The Ultimate goal of this section is to outline the effects decision making has on a business but before that end goal can be reached with proper understanding it is important that the various factions of decision making such as who makes decisions in an organization?, types of decisions made by those people, steps involved in the decision making process and one of new elements to the issue, Ethical Decision making are all explained and understood clearly. It is when that has been achieved that the effects of the decision making process can be outlined with vivid understanding

Managers who are the ones that are held responsible to the duties of planning, leading, organization and control in an organization are the ones that are charged with decision making in organizations (Boone 2013) and these managers according to classical management theories are usually grouped into three parts;

Top Level Management which consists of Board of Directors, General Managers, Presidents, etc.; These are customarily known as the Administration and are responsible for formulating, implementing and enforcing long term strategies to merge with the objectives of the organization. The decisions made at this level are complex and affect the entire direction of an organization e.g To have the most market share in an industry  (Weijrich and Koontz, 1993, Stoner, Freeman, & Danial, 2003)

The Middle Level Managers, consisting of  Heads of Departments, Deputy and Assistant Directors etc . It is their duty to formulate the policies and plans in close relation to that of the top level management. This sub group falls in-between Top Level and First Level Management.

First Level Management; these managers comprise mostly of supervisors, their duties are operational duties that consists of day to day decision making that are rather simple and routine

Types of Decisions

Now, there is clear understanding of the individuals that are responsible with making the decisions in an organization and their categories, now the focus is on the type of decisions made by these managers. Understanding this aspect would particularly benefit how we can relate decision-making making with the effect it has on businesses.