Business Decisions Concept and Process Concept of Decision

Business Decisions: Concept and Process

Concept of Decision Making • The Process of generating and choosing a solution is called decision making • Decision making describes the process through which a course of action is selected as the solution to a specific problem

Process in Decision Making • Koontz, O’Donnel and Weihrich • Four stages: – Premising-certain assumptions about the nature of critical or strategic matters regarding internal and external environment in which the decisions will be put into operation. – Identifying alternatives in terms of the goal sought – Evaluation of alternative in terms of the goal sought – Choosing of an alternative that is considered the best option to solve the problem concerned

Research as a Decision Support system • A decision support system automatically searches for, manipulates and summarizes information needed by managers for specific decisions. • Research is a decision support system as it searches, manipulates and summarizes information in a given context.

Business Research dimensions • Environmental research • Research on Functional Areas of Business • Institutional Research in the context of LPG

Environmental research • The research studies on these topics can probe into: – The specific factors and aspects of the particular environment – The nature and extent of impact of the environmental factors on the business – Measures by which the opportunities offered by the environment can be reaped – Means by which the threats posed by the environment can be migrated or minimized

Research on Functional Areas of Business • • • • Marketing Decisions. New product development Pricing strategies Distribution channel Salesmanship Advertising copy Media effectiveness Consumer Behaviors Market segmentation Retail marketing B 2 B Export marketing Supply chain management’ Marketing strategies

Personnel • Effectiveness of different sources of recruitment and training • Leadership-traits, style, effectiveness • Employee motivation • Morale • Absenteeism • Job satisfaction’ • Labour turnover • Welfare measures • Quality of work life • Executive excellence • Training and Development • Employee ethics

Financial • • • Primary markets Stock markets Mutual funds Investor behavior and protection’ Global capital markets Cost of capital and capital structure Risk-return patterns of projects Working capital management Credit management Inventory management Cash Management

Institutional Research in the context of LPG • Liberalisation – Financial liberalization-freeing of institutional financing agencies like commercial banks and term financial institutions from hold of governments – Tax reforms – Trade liberalization-WTO • Privatization • Globalization