Management occurs when there is some problem to solve, some choice to make. The various steps in the management pro-cess are really a series of decisions, based upon our previous experiences. Therefore, decision making is the heart of the man-agement. A decision can be defined as a course of action consciously chosen from the available alternatives for the purpose of desired result. So the role of decision making in management involves knowing and actually applying essential information in problem situations of day to day life. Thus it is used to achieve goals and assessing standards.
Management is a mental pro-cess which involves a series of decision making.
It involves the recognition of the prob-lem. It needs relevant information to identify and define it first. Unless the problem is clearly defined and ana-lysed the ultimate decision would not be effective. For e.g. planning house-hold activities, purchasing labour sav-ing devices, selecting clothing for the family.
Decision making will be effective only when one identifies possible alterna-tives. The choice of best selection of alternatives requires thorough knowl-edge about the availability of resources and their limitations.
After identifying the alternatives, one should think of the consequences of each alternative systematically to find out the relevant one, considering the goals, values and standards.
After analysing the problem one should carefully select from the pos-sible alternatives. Evaluation plays a very important role in this selection. Choosing the best from the several possible alternatives will be helpful in solving the problem.
This is the ability to assess and accept the consequences of the decision for making future decision. It is the evo-lutional process. The process of evalu-ating the alternatives is based on your goals, values and standards. This expe-rience would indicate the final out-come of the decision making. It creates self confidence in people and gives feedback to make effective decisions in the future.
There are different types of decisions namely individual decision, group deci-sion, habitual decision, central decision, economic decision, technical decision and decision making due to experience and knowledge.
It is the decision pertaining to an indi-vidual e.g. education. Individual deci-sions are more quickly made. The deci-sion making of an individual revolves around the values, goals, standards and roles the individual assures in the relevant set of frame work.
It is made from the collective action of several individuals each of whom has distinct values, goals, stand-ards and role perception. It is a dif-ficult process and a slow process. Role conflicts would emerge in this situation.
It is the lowest level of decision. Once an individual is trained to do systematic work, he will follow that throughout his life. They are rou-tine, repetitive actions related to daily activities. Once it becomes a habitual choice, the resultant action is quick and spontaneous.
Central decision has many support-ing decisions to complete the whole task e.g. purchasing a house is a cen-tral decision. This leads to look out for other supporting decisions like trans-portation facilities, community facili-ties, savings etc.
It is based on allocation and exchange process relating to resource use. This decision needs the allocation of human and non-human resources to attain a goal. It reveals the allocation of resources among the combination of goals that will bring about the greatest degree of satisfaction.
This decision involves a decision, which will enable the best combina-tion of resources to achieve the stated goal.
Decisions must be made based on past experiences and knowledge. This helps a person to become more efficient and skilled in decision mak-ing process.