Decision making can be described as a process of making a decision or decisions, based on choices made amongst two or more competing course of actions. The ‘Decision making’ also requires making a define choice between two or more alternatives course of actions that are available.
In every decision making, there is said to be a positive and negative outcome as future consequence(s).
The importance of decision making in individual daily life and in organization level was demonstrated by two scientists, Arkes and Hammond (1992), in ‘Judgment and Decision making’ indentified the four types of information which decision maker requires constructing a decision tree.
1. What are the available courses of action(s)?
2. What are the consequence events that might follow from the identified available actions?
3. What is the likelihood of each event?
4. What is the value of each outcome to the decision maker?
Henceforth, in i965, An American Psychologist Herbert Simon also established the essence of why a decision making is indisposed and required to be made. He identified and claimed that there are three essential elements or stages in the decision making process, which are:
1. The Intelligence Activity.
2. The design Activity.
3. The Choice activity.
The Intelligence Activity; is also refer to as the ‘Search activity’, which includes fact findings, problem and opportunity sensing, analysis and exploration of available course of actions. If there is no identified need to make a decision, then it is said to be no decision making is required.
The Design Activity: Involved formulation of solutions and generation of alternative course of action(s), finding and analyzing the possible courses of action(s).
The Choice Activity: This stage involves the maximization of goal, the selection of alternatives and the decision making and choosing the preferred best action from the available course of actions.
Psychologist Herbert Simon further established and categorized decisions into two categories; Programmed Decisions and Non-Programmed Decision.
Programmed decisions are type of decisions which are routine and repetitive, of which are within the frame work of organization policies and rules. Such polices rules are established in advance to solve a re- occurring problems within the organization. Such programmed decisions are usually taken at lower management level and tends to have a short-run impact on organization.
In contrast, the Non- Programmed decisions which are type of decisions which are non-routine and deployed to resolve non-routine problems, they are relevant in solving unique and unusual problems that arises, of which the alternatives cannot be decided in advance. Non-Programmed decisions are usually of high importance and significance with long-term consequences on organizations, such decisions are decided at the top management level.
A model of decision making known as the Rational Decision Making Model arises...