LEARNING OUTCOMES:

1. Define decision-making and explain the role of decision making for managers and employees

2. Discuss the conditions of certainty, risk and uncertainty under which decisions are made

3. Describe the characteristics of routine, adaptive and innovative decisions

4. Explain how goals affect decision making

5. Differentiate between the rational, bounded rationality, and political models of decision making

Group Name: FANTASTIC SIX

MEMBERS THAT PARTICIPATED IN THE ACTIVITY:

Initial(s) & Surname	Student Number	Contribution
J Swanepoel	32335547	Learning Outcome 1
HT Lekaowa	31836402	Learning Outcome 2
MK Mohapi	32112165	Learning Outcome 3
D Matsemela	30370132	Learning Outcome 3
SRS Lubisi	32339194	Learning Outcome 4
RW Mofokeng	30862760	Learning Outcome 5
KT Nkosi	31632440	Learning Outcome 5

 

LO1. Decision-making is the action or process of defining problems, gathering information, generating alternatives and choosing a course of action.

Role of decision-making for managers;

• Provides leadership by making effective decisions
• Monitors the organization by making decisions based on productivity and well-being
• Makes important negotiations within a team, department or organization.

Employees for decision-making;

• Employees for decision-making is better than outsourcing, saves money and time
• involving employees in decision-making improves morale throughout the company.

 

LO2. Conditions under which decisions are made are classified as certainty, risk and uncertainty:

• Certainty- Condition under which individuals are fully informed about a problem, alternative solutions are obvious and the likely results are clear. For example, the company experiencing a great recession the business authorities may decide to retrench some staff members or reduce their working hours.
• Risk- Condition under which individuals can define a problem, specify the probability of certain events, identify alternative solutions and state the probability of each solution leading to the desired results. Example, An entrepreneur may want to start a business he/she has to consider the needs of the target market, competitors offers and the Threats to the business in a particular area then one can select the best possible outcome and make a decision.

Uncertainty- Condition under which an individual does not have the necessary information to assign probabilities to the outcomes of alternative solutions. Example, deciding to do a particular course without having the knowledge or information of whether your qualification(s) will help you get a job after you graduate.

 

LO3. 

• Routine decisions- Are standard choices made in response to relatively well-defined and common problems with alternative solutions. It is also the process used to make the decisions that are consistent. Decisions that require little research are or time investment are often considered routine.
• Adaptive decisions- Are strategies used in response to a combination of unusual and fairly common problems and it is also used to improve or modify past routine decisions or practices. It is known as continuous improvement concept to quality management and it requires a constant diagnosis of technical, organizational and management processes in search of improvement. Its role is to enhance value to consumers through improved and new goods or services.
• Innovative decisions- Choices based on the discovery , identification and diagnosis of unusual problems and the development of unique alternative solutions.The solutions frequently involve a series of small, interrelated decisions made over a period of month or even years.

 

LO4. Goals affect decision-making by process by causing the decisions to be triggered to search for efficient ways to establish or achieve those goals.

Goals-setting assists one to make proper judgements to a situation hence to reach the decision.

They can also be used to determine if one or business is on the right track or not.

 

LO5.

Rational	Bound Rationality	Political models
The model prescribes a series of steps that individuals or teams should follow to increase the likely hood that their decisions will be logical and sound.	This model is particularly useful because it emphasises the limitations of rationality and thus provides a better picture of the day-to-day decision-making process used by most people.	This model describes the decision making process in terms of the particular interests and goals of powerful external and internal stakeholders.