Six Step Decision Making Process
Part 1
The six steps in decision-making process are:
1. Define the problem
- This is the first step towards a decision-making procedure. Problem exists whenever a decision is being made.
2. Collecting the data
- In making the best decisions, managers need to have the ideal resources such as information, resources, and time available. Therefore, they need to collect all these data.
3. Identifying the alternatives
- Appropriate alternatives needs to be generated whenever the problem have been identified. This is to resolve the problem.
4. Specifying the criterion
- The main purpose of developing and specifying criteria is to evaluate alternatives and to select the best one to resolve the problem.
5. Developing a decision model
- Once the alternatives are developed, an action plan has to be developed. This is essentially for the implementation phase.
6. Making a decision
- The reason of making a decision is to fix a problem. The final test of any decision is whether or not the problem is being fixed. If the problem remains or has eventually become worse, the steps of the decision-making process need to be repeated until an acceptable resolution has been found.
The main purpose of “specifying the criterion” is to evaluate alternatives and to select the best one to resolve the problem while “developing a decision model” is an action plan that has to be developed or implementing the best alternatives which is essential for the implementation phase.
i)
Management accountant usually involves in planning decisions and also control decision. Planning decisions focus on selecting organization goals, predicting results under various alternative ways of achieving those goals, deciding how to attain the desired goals and communicating the goals as well as how to attain them for the organization. Control decisions mainly focus on taking
The six steps in decision-making process are:
1. Define the problem
- This is the first step towards a decision-making procedure. Problem exists whenever a decision is being made.
2. Collecting the data
- In making the best decisions, managers need to have the ideal resources such as information, resources, and time available. Therefore, they need to collect all these data.
3. Identifying the alternatives
- Appropriate alternatives needs to be generated whenever the problem have been identified. This is to resolve the problem.
4. Specifying the criterion
- The main purpose of developing and specifying criteria is to evaluate alternatives and to select the best one to resolve the problem.
5. Developing a decision model
- Once the alternatives are developed, an action plan has to be developed. This is essentially for the implementation phase.
6. Making a decision
- The reason of making a decision is to fix a problem. The final test of any decision is whether or not the problem is being fixed. If the problem remains or has eventually become worse, the steps of the decision-making process need to be repeated until an acceptable resolution has been found.
The main purpose of “specifying the criterion” is to evaluate alternatives and to select the best one to resolve the problem while “developing a decision model” is an action plan that has to be developed or implementing the best alternatives which is essential for the implementation phase.
i)
Management accountant usually involves in planning decisions and also control decision. Planning decisions focus on selecting organization goals, predicting results under various alternative ways of achieving those goals, deciding how to attain the desired goals and communicating the goals as well as how to attain them for the organization. Control decisions mainly focus on taking