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Types Of Decision Making Environment Commerce

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In our day-to-day life we frequently face state of affairs where we need to do determination. It could be a personal determination on acquiring a new auto or even a work determination to establish a new merchandise. What can we make to repair this? How will this impact my kids, my partner? When will this undertaking be completed? How much does it be? To certain people, determination devising is something that seems really hard and complicated for them to make. Some determinations are made to work out certain job where some determinations are made for better alterations.

Making a determination is non an easy undertaking, a incorrect determination will impact you severely while doing a good determination will benefits and helps you. This study will discourse the types of determination devising environments and several illustrations that describe those environments.

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Decision devising is the believing procedure of picking a pick between few of the available options. It serves as a intent to take any uncertainness and vacillation before we decide on something.

The best determinations normally are the determination that can convey success and effectual consequences. When making determination devising, we must look at both positives and negatives of each option. We should ever believe and see all the options before doing up a determination. Sometimes there might be a better alternate pick that we did non set under consideration, therefore it is of import for us to ever maintain path and record down the ground why determination are made. These paths and record can be used in the hereafter for mention and betterments aim, and saves us a batch of clip by forestalling any past errors. Wikipedia ( 2012 ) explains that:

Decision makingA can be regarded as the mental procedures ( cognitive procedure ) ensuing in the choice of a class of action among several alternate scenarios. Every determination doing procedure produces a finalA pick. [ 1 ] A The end product can be an action or an sentiment of pick.

To do a good determination, the ability to calculate the result of the available options is really of import. Harmonizing to Al-Tarawneh, A HussienA A. ( 2012 ) A Usually determination doing procedure involved the stairss below:

Define the Problem

Determine Requirements

Establish Goals

Identify Options

Measure 1. Specify the Problem

The first measure of specifying a job is to roll up all the necessary informations and place the intent and root causes of a job. At this phase, our intent is to obtain a conceptual definition. This conceptual definition will be use as a base that we can redefine and determine subsequently. However it does non intend that we are looking at merely a portion of image or merely a wild conjecture.

Measure 2. Determine Requirements

At this phase, we determine the demands and conditions that are required to decide the job. Just like a package installing, there are certain demands that required to be run intoing before it can be successfully installed. This is to guarantee the solution we are using is still protecting our stockholder values.

Measure 3. Establish Goals

Goals are the desirable consequence that we would desire to see in the determination doing result.

Determine the ends are really puting up a mark far compare to the minimal desires.

Example, the demand of work outing job “ A ” is that we do non lost any of our bing clients in the procedure. In the other manus, set up ends that we are taking for is to additions and acquire new client. It ever drives us to file away something better.

Measure 4. Identify Options

And in conclusion we identify all the options. Any of these options must at least run into the minimal status of demands we have determine earlier. We must look at all the options to see does it run into the demands or non. Those options that do non run into the demand are removed. By making these filtering, we will stop up with few of the best options. From there we can compare and make up one’s mind which the best alternate to take from is.

3.0 Types of Decision Making Environment

In determination devising, we may meet clip where we merely do non hold the required information to do a determination and maintain holding vacillation. Sometimes it ‘s a determination that we have a batch of information with and really certain with the conditions. There are 3 types of determination devising environment that we can sort. There are:

Decision Making in Certain Conditions

Decision Making in Uncertain Conditions

Decision Making in Risky Conditions

3.1.0 Decision Making in Certain Conditions

Decision doing under a certain conditions means that the individual who makes the determination have all the complete and necessary information for him to do the determination. With all the information available, that individual is able to foretell what the determination consequence will will take into. By able to foretell the result we can easy do a certain determination with certainty. The result that gives the best consequence will normally be used and carried out. If we are given 2 picks and first picks are better than the second pick, certainly we can make up one’s mind easy which option to take from. Several illustrations of Decision Making in Certain Conditions are as below:

3.1.1 Example 1 ( Personal )

Jason merely moves to KL to work and he is looking for topographic point to lease. He had been offered with two alternate rental topographic points. Rental A and Rental B. Rental A is near to Jason ‘s workplace and is within walking distance. Rental B is a spot far from his working topographic point and required him to drive to walk. Both rental fees are RM500 per room. With the complete information above, Jason will be able to do determination in a really certain status.

3.1.2 Example 2 ( Consumer )

Shop ABC has merely opened beside Shop DEF and is selling a broad scope of day-to-day consumer merchandises. Consumers around the country now have another alternate topographic point that they can shop from. Shop ABC has better overall monetary value comparison to Shop DEF, and Shop ABC employee are friendlier. Both Shop are unfastened from 8am to 10pm. Beside that Shop ABC have their ain store points wagess card where store DEF do non hold any particular publicity. With the scenario above, the consumer has adequate information to take over these two topographic points. This is a determination that will be made under certain status.

3.1.3 Example 3 ( Business )

ABC Company has been runing for many old ages, and it is a company that provides informations entry as service. The pressmans that they are utilizing are really out-of-date and faulty from clip to clip. The board of the company decided to alter and review all the bing pressmans. Since there are broad choices of trade name they can take from, they have come out with the concluding two alternate trade name choices that are popular in the market. The concluding two options of trade name are Canon and HP. With all the info easy collected from the pressman ‘s web site, they were able to roll up all the needed info easy and come out with a tabular array to compare the cons & A ; pros to do the concluding determination of which trade name they are traveling to buy. With all the information available, anticipations are easy to do and this is a determination made under certain status.

3.2.0 Decision Making in Uncertain Conditions

Making a determination when you are unsure of the status is similar to miss of information that can assist us to make up one’s mind. Because of deficient information, the determination shaper does n’t cognize the hereafter and non able to foretell the result of every option he has. In order to do a determination with such conditions, the determination shaper would hold to judge and made the determination based on their experience. If they do non hold such experience, they have to confer with and seek advice from people who have more experience. There is a small hazard involved at that place nevertheless since we are non able to foretell the consequence nevertheless experience from the yesteryear would shut the spread. The followers are some illustrations when doing a determination in an unsure status. They are:

3.2.1 Example 1 ( Personal )

Jason is presently utilizing a really old version of Nokia Phone. Sing everyone is utilizing a really advanced phone, he decided to alter his phone to a smart phone. Smart phones in the market are utilizing window OS, Apple OS and Android OS. Jason ne’er used such interface on a phone before. Which phone OS is more easy to utilize and which map of the phone is better, he is non that certain. He so seeks advice from his friends and asks for sentiments. After acquiring adequate advice, he so bought the smart phone. In this scenario, Jason does non hold all the sufficient information, so he gets advices from his friends. Jason is doing the determination in an unsure status.

3.2.2 Example 2 ( Consumer )

A new trade name of rinsing detergent has been introduced into the market. It is call “ Detergent XYZ ” On the advertizement and merchandise claiming it is the most efficient detergent of all time in market. Merely 1 little cup of detergent would be sufficient to rinse all the soiled apparels clean and white. Consumers are attracted to the new merchandise nevertheless they are unsure how good the merchandise is. Will this new detergent clean good? Does it harmful to their tegument or custodies? The lone information that the user know, it can clean but how good they wo n’t cognize nevertheless the monetary value of the detergent is inexpensive. In this instance, consumers are doing the determination to purchase the detergent in an unsure status.

3.2.3 Example 3 ( Business )

ABC Restaurant is celebrated for their poulet rice at Kampung ABC. They have been selling lily-livered rice for the past few old ages. Business has been good ; nevertheless they are seeking to use the concern. Hence they decided to seek out selling Duck Rice, since that would foremost shop of all time in Kampung ABC that serves that. ABC Restaurant is non certain will the people in the small town would eat this new bill of fare. Would people in Kampung ABC accept duck every bit good? How much would they sell Duck Rice? Will the Duck Rice be sold as the same monetary value as Chicken Rice or cheaper? In this instance, ABC Restaurant are confronting a clip where they are doing the determination in an unsure status.

3.3.0 Decision Making in Risky Conditions

Making a determination in hazardous conditions means that we are doing a determination that might ensue the job even large or from bad to really bad. Merely minimum information is available to foretell the result. A incorrect rating on doing the determination under hazardous conditions might even ensue the company endure immense doomed of net incomes or even insolvents.

3.3.1 Example 1 ( Personal )

Jason has been in a relationship with Mariah for about 1 twelvemonth. They both love each other. Mariah suggested to Jason so both of them acquire married. Jason now faced with a state of affairs where he has unsure conditions that can assist him to make up one’s mind. Taking the relation to the following phase or do n’t acquire married. Jason is non able to foretell the result of the matrimony either would do him happier or endure. This is because Jason merely knows the miss for about 1 twelvemonth, but sometimes it took really long or even everlastingly to cognize one ‘s true nature. Jason has non yet gets blessing from his parents and is non certain if Mariah parents like him or non. Jason is besides doubting will this matrimony will effects her current calling or non. However since Jason love Mariah so much, he merely agrees to get married her. In this state of affairs, Jason is doing a determination under a hazardous status.

3.3.2 Example 2 ( Consumer )

A new tegument merchandise has been release to the market, it is a face washer called ABC Face Cleaner. It is a merchandise commercialized to vouch skin whitening consequence in merely several clip of utilizing. There is no exact information explain that how does this merchandise aid in bettering the tegument colour and how long precisely it take to acquire the consequence. However due to the attractive monetary value and the consequence promised, consumers decided to give the merchandise a attempt. In this instance, consumers are doing a determination to purchase the merchandise under unsure status.

3.3.3 Example 3 ( Business )

Company ABC has been selling their new merchandises for some clip. The board of the company is holding a treatment either to halt selling the new merchandise or set more investing to advance this merchandise. The lone information they have is the hebdomadal gross revenues studies. It seems that for the first 7 hebdomads of the merchandise launching, the merchandise are non selling good and are doing them to endure doomed of net incomes. However on the studies, they besides noticed that hebdomad by hebdomad the merchandising rate is easy additions. It is demoing an addition gross revenues rate growing of 5 % every hebdomad. Based on all the info they have, they province that, the merchandise gross revenues rate will increase until 70 % and company will get down deriving net incomes get downing on the following 2 hebdomad. Without acquiring other information such as how the consumers do see their merchandise, they went in front and do a determination to put more on this merchandise. ACB Company is really doing the determination under a hazardous status.

4.0 Suggestion to better Decision Making

Making a determination may look really simple nevertheless it is non. To do certain that we have the best result of the determination we made, we must guarantee it is rational. The determination that we are doing have to be based on sentiments, sensible ground and besides facts. To guarantee we make the rational determination, Williams ( 2000 ) stated that six stairss of procedure that must be followed. This 6 procedure is showed at Figure 4.1.

Figure 4.1 Rational Decision Making Process

Specifying Problems

The stairss of determination devising ever affecting the stairss of specifying and place the job. The determination shaper will hold do a clear image of the jobs that they are confronting, and root cause of the job and how to rectified them.

Indentifying Decision Criteria

In rational determination devising, at this phase we are indentifying the determination standards. These are the points that will be put under consideration during the determination devising.

Allocating Weights to Each Criteria

After find the standards before, we will so apportion weight to each of them.

The weight here refers to the powerlessness of these standards. To find the weight of each standard, comparative comparings are normally used. By making a comparative comparing, we will able to place which standards are the most of import.

Generating Alternate Solutions

In this phase, the following measure would be think and list down the alternate solution.

The procedure would goes smoother if more options are generated.

Measuring Options

After naming down all the possible options, in this phase we evaluate and judging these options one by one. Information on each option must be obtained before the comparing is made.

Choosing the Optimal Decision

The concluding measure in rational determination devising is to take from the best alternate solution from the list we have. The best option are determine by the most determination standards that are meet. The options that meet the most will be selected alternatively if there are no options that meet all of the determination standards that we have listed down earlier,

4.2.0 Example of Rational Decision Making Scenario


Measure Used

For illustration, my company late notices that plants are delayed by a batch due to employee productiveness. After probe has been performed, they found out that job occur due to decelerate public presentation of the computing machine the employee are utilizing. Hence the direction decided to upgrade the full computing machine in the office to increase productiveness.

Specifying Problems

Management so defines the standards required to be taken into consideration when purchasing the new computing machines. The determination standards that are such as monetary value, guarantee and system support. ( Refer to postpone 4.2 )

Indentifying Decision Criteria

After all the standards have been determine, they now set uping the weight of the standards based on which are the most of import. In this instance, employee cognize how to utilize the interface is set to the highest and guarantee is set to the lowest as they have their ain IT support. ( Refer to postpone 4.2 )

Allocating Weights to Each Criteria

Following is happening out all available options and these options will be evaluated. The options that will be taken into consideration will be Apple, DELL and HP. ( Refer to postpone 4.2 )

Generating Alternate Solutions

After all available options is listed down, we so evaluated them based on the standards that we have listed down antecedently ( Refer to postpone 4.2 )

Measuring Options

Last we select and make the determination based on options that have the meet the standards the most. ( Refer to postpone 4.2 )

Choosing the Optimal Decision

Standards that must be meet




Employees know how to utilize the operating system interface.




Able to recycle the package licence.




Work Application Supported.




Price below RM3000 per unit.




Standard Warranty Period.




Onsite Warranty Service.




Own IT people able to back up it.




Table 4.2 Indentifying Decision Criteria

5.0 Decision

Decision devising accomplishment is of import in both personal life and cooperate environment. Able to do the right determination will repair the job for good. Making a determination by utilizing rational determination stairss will assist in choosing the best outcome consequence among all the options.

Cite this Types Of Decision Making Environment Commerce

Types Of Decision Making Environment Commerce. (2017, Jul 05). Retrieved from https://graduateway.com/types-of-decision-making-environment-commerce-essay-essay/

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