Decision-making process in small business
Question A.Decision making is a vital component of small business success. Decisions that are based on a foundation of knowledge and sound reasoning can lead the company into long-term prosperity; conversely, decisions that are made based on flawed logic, emotionalism, or incomplete information can quickly put a small business out of commission (indeed, bad decisions can cripple even big, capital-rich corporations over time). Thus, the initiation of a business must be made with careful planning and decision making. Based on the case study provided above, identify which type of decision Jeff is considering, using evidence from the case to support why he made that decision.
Answer: A decision is a choice made between two or more available alternatives. Decision making is the process of choosing the best alternative for reaching objectives. The type of decision Jeff is considering is the Organisational and personal decisions. Organisational and personal decisions are decisions which are taken by an individual in his personal capacity. Such decisions are concerned with himself. For example Joe McIntosh desires to have three (3) outlets of SmartTec, and as such is considering opening another branch in Portmore, where most of his current customers reside. He has conducted the relevant market research and has found that there is a great demand for this type of business in Portmore, which has made him more eager to open the Café as soon as possible. This decision he made won’t affect the organization directly. However the organization may be affected directly by such decisions. The power to make personal decisions cannot be delegated.
Question B.All business people recognize the painful necessity of choice. Furthermore, making these choices must be done in a timely fashion, for as most people recognize, indecision is in essence a choice in and of itself a choice to take no action. Ultimately, what drives business success is the quality of decisions, and their implementation. Describe the THREE (3) types of decision-making conditions Jeff will likely experience throughout this process, give reasons to support your answer.
Answer: Decisions are part of the manager's remit. Difficult choices may have to be made for the common good of the organization. There are three types of decision in business, these three are; strategic, tactical and operation.