Decision-making is the central activity to any managerial function. Making the right decisions is the most challenging task of any manager. Napoleon said, after he lost the waterloo battle, "even not to take decision is to decide". And the Hobson's choice, "Every decision is debatable", tells how complex and critical is the decision-making process. In today's business context, where there is no geographical barrier, where there is easy access to global market, stiff competition among the companies has becoming more difficult.
Unless the fundamentals and the entire scope and domain of decision-making is understood, one will continue to suffer from the problem of "indecision" and its close cousin , "wrong decision". There are a number of quantitative and scientific approaches to choose the most suitable alternative from many, after evaluation. These are structure and system-based which consist of scientific, statistical and mathematical analyzes. Depending upon the nature of information the decisions are categorized .
Here, for every decision there is only one alternative event and, therefore, only one outcome for each action. For example, there is only one possible event for the two possible actions: "Do nothing" at a future cost of Rs. 3.00 per unit for 10,000 units, or "rearrange" a facility at a future cost of Rs. 2.80 for the same number of units. A decision matrix (or pay-off table) |
