Members that participated in the activity:

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

A decision is a course of action taken from a set of alternatives to achieve organizational and managerial goals or objectives. Decision-making is a continuous process of making choices by identifying a decision, gathering information and assessing alternative resolutions. It is also an indispensable component of managing any organization or business activities.

Effective managers and employees can systematically base various types of decisions on the nature of the problem to be solved, the possible solutions available and the degree of risk involved. They can do this by relying on all six managerial competencies to make a decision, which include communication, planning and administration, teamwork, strategic action, global awareness, emotional intelligence and self-management.

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

Certainty is the condition in which a problem is shared among individuals of certain organisations. Each individual is required to come up with solutions to fix the problem, the solutions will then be collected by the decision-maker and finally the decision-maker will go through the potential ideas and choose the best one that will be able to fix the problem.

Uncertainty is the condition in which individuals have no knowledge on upcoming or currently faced problems within the organisation, making it difficult for them to come up with solutions to deal with the problem. Managers therefore have to make their own assumptions on the decision-making process.

Risk conditions include individuals defining a problem, specifying the probability of certain events, identifying alternative solutions and stating the probability of each solution which can lead to a desired result. Measuring of risks captures the possibility that future events will render the alternative unsuccessful.

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

Innovative decisions are choices based on the recognition of rare and debatable problems or the creation of other unique and creative solutions. These solutions include decisions which relate to one another and are made over a period of years or months. This means innovative decisions take time to develop and these decisions are usually based on the information that changes all the time.

Adaptive decisions can be defined as an effective reaction to a change in a solution or rather problem solving which involves improving and altering past routine decisions. Adaptive decisions involve strategizing and prioritising and the decisions are made over time which result in a large number of gradual improvements.

Routine is a decision-making that does not need much time to evaluate and analyse. The decision can be taken immediately. Routine uses a clear procedure, decisions are made on a regular day-to-day basis and it has a small scale in nature.

4. Explain how goals affect decision-making:

Decision-making in organisations under the conditions of risk and uncertainty is coupled directly with goals in one of two ways: The decision-making process is triggered by a search for better ways to achieve established goals or the decision-making process is triggered by an effort to discover new goals, revise current goals and drop outdated goals.

Goals are crucial in giving employees, managers and organisations a sense of order, direction and meaning.

The nature of goals:

• Clear goals specify the quality or quantity of the desired results.
• Goals are results to be attained and thus indicate the direction in which decisions and action should be aimed.
• Goals are called objectives, ends, purposes, standards, deadlines, targets and quotas.
• Goals can either be short-term or long-term.

Why people set goals:

• Goals serve to focus individual and organisational decisions and efforts.
• Goals aid the planning process.
• Goals motivate people and stimulate better performance.
• Goals assist in performance evaluation and control.

5. Differentiate between the rational bounded rationally and political models of decision-making:

Rational decision-making is a multi-step process for making choices between alternatives. The process of rational decision-making favors logic objectivity, analysis over subjectivity and insight. The word 'rational' in this context does not mean sane or clear-headed as it does in the colloquial sense.

The approach follows a sequential and formal path of activities.

This path includes:

• Formulating goals.
• Identifying the criteria for making the decision.
• Identifying alternatives.
• Performing analysis.
• Making a final decision.

Political models of decision-making closely resemble the real environment in which most managers and decision-makers operate. This is usually useful in making non programmed decisions. Making decisions is just complex.