Managerial Decision-Making in an Organization

Introduction

Decisiveness is an attribute that sets skilled managers apart from poor ones. Poor decision-makers are not fit to hold managerial positions. They are better off serving in an administrative capacity. Decisions are integral aspects that establish and determine the future of organizations. It is essential to make sound decisions since most organizational decisions involve enormous resources. It is imperative that utmost caution is exercised to ensure the sustainability of organizations. Most of these decisions can also determine the bearing of the company and prospects for profitability (Harvard Business School press, 2006). Decision-making can be defined as the selection of the most logical choice from available options.

Models of decision-making

It is believed that decision-making procedures are determined based on two models, Simon’s normative model and the rational model. Simon’s normative relies on the hypothesis that decision-making is not rational, but is affected by three factors. This implies that extensive manipulation of data is not to be performed (Institute of Leadership and Management, 2007). The rule of thumb is always applied when deliberating on issues, with the aim of decision-making based on imperative needs without going through a rational process. Emphasis is placed on attaining results without pursuing due process, by agreeing to fulfill the most pertinent of needs, rather than following normal procedure.

The rational model is a four-step cycle. It requires one to determine the problem before the generation of tentative answers happens. It follows that a single decision will be chosen from those that have been proposed after careful deliberation (Harvard Business School Press, 2006). The last requirement is the implementation of the selected option before an evaluation is done on the same.

Managerial Decision-Making Methods

Managers often employ their creative thinking abilities to make decisions with the aim of advancing the company’s profile. Some of these decisions are required at times of crises; therefore, they need to think well before implementing any decisions (Hill & Jones, 2009). Managers and their groups make most of these decisions either by dialog or after debating several ideas.

Alternatively, a manager may issue a directive to his group to implement certain directives. This comes after he has conducted a personal evaluation of the scenario at hand and formed an opinion. It will be up to the group to adopt, and implement those directives within the specified time duration. It is a challenging step since it may be met with resistance from employees who feel left out of the decision-making process.

The manager may summon members to a meeting, where the group will be informed of the impending issues and encouraged to participate in finding the solution. It is a participative undertaking where the input of every member is considered during the discussion (Hill & Jones, 2009). The manager is tasked with carefully reviewing all fronted proposals before settling on the most suitable. It is comparable to the dialog method, although there is no guarantee that member suggestions will be adopted. Members are not also required to work towards achieving consensus, but to air their personal sentiments.

Managers can also make decisions then confer with their group members with the aim of gaining their support (Tropman, 2003). They will use different strategies to achieve this, including pleading with them to adopt the stance and support it. To achieve this, they need to have exceptional communication skills and a perfect working relationship with their employees.

The manager also has the option of delegating the decision-making responsibility to his subordinates and allowing them the freedom to formulate and implement decisions. The manager will only step in to provide guidance and assistance where needed, but largely remains anonymous throughout the entire process.

Consensus

This method requires complete agreement on all issues by the group members during the decision-making process (Hill & Jones, 2009). The input of all members is to be considered carefully allowing ample time for rigorous examination by all members before ratification. This is an all inclusive method hence group members will feel comfortable during the implementation stages.

Authority

The manager makes the concluding decision in this method. Factors in the build up to this are neither specified, nor given prominence. The manager has the option of choosing from a set of proposals forwarded by the group, or making a personal decision and imposing it on the members (Hill & Jones, 2009). It is a risky move; therefore, tendencies of revolt by people may be high. It is also inappropriate since it goes against principles of team work.

Majority

This is touted as the best option to adopt. Known as democracy in some quarters, the minority voice their opinion, while the majorities determine the strategies taken within the group (Tropman, 2003). The manager convenes a meeting where group members are informed about the state of affairs. The ensuing discourse provides a forum for all to air their views before the majority opinion is adopted. This method is advantageous since it yields a collective result and goes a long way in boosting team spirit and collective responsibility.

Minority

The circumstances preceding decision making in this method are similar to those of majority, only that the mode of settling on the adopted option are different. Here, after the team has been assembled, a small number of participants argue their case strongly in a bid to convince others to their side. In case it fails, this team will vote to veto any option chosen by those who opposed their ideas.

Group think

In this method, the group stifles balk so that no dissenting opinions are voiced. This may be misleading since the assumption will be that the adopted decision is popular. The manager may be involved in influencing these decisions (Tropman, 2003). In some cases, managers are not involved, but ideas are conceived and advanced by vested interests for personal gain. It is unsuitable since it is not representative.

Risky shift

When groups go to extreme ends during deliberations, the decisions they make fall under this category (Hill & Jones, 2009). The group may exercise extreme caution when making a decision, or be overly daring in the choice they make. All these are extremes that individuals could not go to on their own. Being a gamble, the decisions adopted may pay off or backfire; hence it is not advisable to use it when making crucial decisions.

Conclusion

In summary, the modes employed by the manager during group decision making sessions depend on several factors, including; the weight attached to the decision by the group; level of technical knowhow brought to the session by participants; the time frame in place for debating and implementing the decision; the scope within which repercussions of the decision will be felt (Tropman, 2003). Wisdom, great understanding and temperament are necessary before any mode is applied.

References

Harvard Business School press. (2006). Making Smart Decisions. Massachusetts: Harvard Business School Press.

Hill, C. and Jones, G. (2009). Strategic Management Theory: An Integrated Approach. (9th edition). Connecticut: Cengage Learning.

Institute of Leadership and Management. (2007). Solving Problems and Making Decisions. (5th edition). Massachusetts: Institute of Leadership and Management.

Tropman, J. E. (2003). Making Meetings Work: Achieving High Quality Group Decisions. (2nd edition). London: SAGE.

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