Page 24 - DCAP208_Management Support Systems

Unit 2: Decision Support

According to Trewartha and Newport: Notes
“Decision making involves the selection of a course of action from among two or more possible
alternatives in order to arrive at a solution for a given problem.” opportunity

Decision making is the process of making a choice between a number of options and committing
to a future course of actions.
Decision making is the thought process of selecting a logical choice from the available options.

!
Caution When trying to make a good decision, a person must weight the positives and
negatives of each option, and consider all the alternatives.

For effective decision making, a person must be able to forecast the outcome of each option as
well, and based on all these items, determine which option is the best for that particular situation.

2.2.1 Decision Making Process

Making good decisions is essential to the management process. As discussed, decisions are
rational choices among a group of alternatives. Good decisions are the result of a sequential
series of analytical steps:

1. Identify and delineate the problem: No management action can occur unless there is a
need to resolve an issue. Additionally, when identifying a problem, it is necessary to
assess the seriousness of the issue. Highly critical issues require more immediate attention
and a greater demand on existing resources. Difficulties in identifying problems include:

Perceptual errors: Often problems are not identified because of personal biases, which
do not allow the individual to perceive that there is a problem needing attention.
Preconceived notions of how something should be (as well as personal preferences)
will interfere with the ability to identify a problem.
Insufficient information: Insufficient research about a specific problem can lead to
misleading and unwarranted conclusions regarding the true nature of the problem
and its possible solution. Mistaking a symptom as the cause of the problem.
An apparent cause of a problem may just mask a systemic cause. Again, further
research is essential to find the cause and nature of a problem
2. Establish decision priorities and goals: Managers constantly deal with problems. However,
all organizations have limited resources. They must assign priorities to problems in
terms of their importance relative to the organization‘s goals. This process results in a
matching of organizational resources with priorities and creates a management
methodology for administering solutions to problems.

3. Ascertain the cause of the problem: In order to develop a solution to a problem, it is
essential to understand its cause. This requires a systemic understanding of the dynamics
of the situation that has caused the problem.
4. Develop realistic alternatives: It is important for the manager to develop a range of
alternative realistic solutions. This means doing extensive research into the nature of the
problem and discovering what alternatives would be a good fit.
5. Weigh the best alternative: This requires extensive evaluation and comparison using a
cost benefit analysis. The alternative solutions are developed within the constraints of
limited time and resources, and with a degree of uncertainty.

LOVELY PROFESSIONAL UNIVERSITY 17