2.0 Discuss the importance of decision making and the application of decision analysis.
2.1 Importance of decision making.
2.2 Application of decision analysis.
3.0 Identify and outline a decision problem relating to your work or an external organization.
4.0 Apply the simple multi-attribute rating technique (SMART) to the outlined decision problem.
Step 1: Who is the decision-maker and why?
Step 2: Identify all the alternatives courses of action.
Step 3: Identify the attributes that are relevant to the decision problem (minimum of 5)
Step: For each attribute, assign values to measure the performance of the alternatives on that attribute
Step 5: Determine the weight for each attribute.
Step 6: Convert the raw data into a weighted value.
Step 7: Choose the best alternatives.
Step 8: Sensitivity Analysis.
5.0 Discuss and detail the strengths and limitations of your analysis in the context of your decision problem
Strengths of my analysis.
Weaknesses of my analysis.
Globalization gives businesses access to similar resources and global markets create competition causing several processes of businesses to converge on the same and similar standards. In this circumstance, effective decision making is the foundation of competitive advantages and expected outcome for shareholders. Many companies are taking opportunities from globalization and system development to transform their business activities and make the companies more efficient and effective in the way of making decisions across the businesses.
However, the suitability of decision making relies on the expertise and experiences of decision-makers and managers of businesses. This coursework, first, defines the term “decision making” and its importance and the application of decision analysis. Then, a decision problem is defined with its objective for a company called Al-Baraka, and this decision problem is analyzed using a scientific tool called Sample Multi-Attribute Rating Technique. Next, the strengths and limitations of this decision analyzed are discussed focusing on the identified problems in this paper.
2.0 Discuss the importance of decision making and the application of decision analysis
2.1 Importance of decision making
Decision making and its implication
Business organizations make decisions at every level of their operation, where the business decisions are mainly classified as routine operational decisions and managerial decisions. According to Akrani (2011), decision making refers to the selection right choices to meet business objectives. However, decision making is not only choosing the right choices or compromising, but also refers to a process where alternatives are identified and the best option is identified and implemented to meet the organizational goals (March, 018).
The Decision-making process defined a number of actions for finding out the best alternative. Through an effective analysis process, a single alternative is selected from several alternatives. Decision making is a crucial faction in any organization whether it is profit-oriented or nonprofit oriented (Hammond et al., 2014). The successes of organizational activities mainly come from suitable decision making. A good decision works as the half work is done. On the other hand, poor decision making makes the business performance dull. It is an important function in the management system (Simon, 2014). Basically, the decision is made by the top level of management of the business.
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The main activity of a manager or leader is to make a proper decision for the business and direct the employees on how to implement the decision (Pomerol, 2018). The decision helps to the proper accomplishment of other managerial functions such as planning for business, organizing business activities, directing business functions, employment management, controlling the business activities. The decisions are made in order to run the business in an appropriate way (Huber, 2015). The accomplishment of goals, making strategies, and policies depend on the appropriate decision making by the management.
Decision making affects both the internal and external activities of the business as the functions of a business are carried out based on the decision taken by businesses (Verma, 2014). Decision making includes planning, budgeting, forecasting about the future of the business. Thus, any problem in these functions can be rectified through the help of proper decision making. Appropriate decision making helps the organization to achieve the stated goals of the business. On the other hand, a moderate or poor decision making affect the business negatively in capturing the opportunities of the business (Huber, 2015).