Decision Making And MIS

Decision-making means making a choice among the given choices by a manager or a

decision-maker. The decision-making process lets a manager come to a conclusion about a
given situation. Therefore, decision-making may be defined as a process of selecting an
optimum and best alternative from a couple of given alternatives to accomplish a particular
task. Decision-making process is the core of managerial accomplish a particular task.
Decision-making process is the core of managerial functions in MIS. It is said that the
decision-making process considers two or more alternatives from which a final decision
could be made. But if only one alternative is available, then no decision could be made. A
decision-making process involves the entire process of establishing goals ,defining activities
,searching for alternatives and finally the development of plans. In addition, the decision-
making process includes all the activities of problem-solving, co-ordinating , information
processing and evaluating of alternatives that usually precede a decision.
A decision is an end or the final product of the decision-making process that represents a
behaviour selected from a number of possible alternatives.
SIMONS MODEL OF DECISION-MAKING

Simons Model
In organisations, the decision-making process is considered as a rational process. It means
the decision-making process is based on the following three phases as given by Herbert A.
Simon in his model of decision making:
1. Intelligence phase
2. Design phase
3. Choice phase
1.) Intelligence phase :
A decision-making studies the environment and identifies the problem or opportunity. The
scanning of environment may be continuous or intermittent. For example,
Reviewing of daily scrap report by a production manager to check the problems related
to quality control. This is an example for continuous scanning.
Periodic visiting of a sales executive to the key customers to review possible problems and to
identify new customer needs. This s an example for intermittent scanning.
The intelligence phase of the decision-making process involves :
Problem searching refers to the differences between the expected and real result obtained
after making a decision, which is given by the following formula:
(Desired/Expected ) (Actual/Reality) = Difference/Problem
For example, a sales manager sets a sales target of certain amount say five lakhs in a
particular month as his expected target, which is expected but he could achieve only four
lakhs worth of sales for that particular month, which is a reality. Therefore, the difference
between the expected and reality value of the target, that is , one lakh is the problem. This
difference worries the sales manager.
In actual practice, the reality or actual value is compared to some standard desired model.
Then the differences are measured and are evaluated to determine the problem or
difference. Various types of models that are used to compare reality are:
1.) Historical models based on estimated information
2.) Planning model
3.) Extra organisational models in which expectations are derived from customers,
consultants and competition
4.) Models used by employees in an organisation
Problem formulation refers to the proper identification of the problem to avoid the risk of
solving the wrong problem. To avoid such a risk, it is very important to understand the
problem well and state it clearly. Sometimes, the process of clearly defining the problem is
sufficient ;but in other cases , we have to simplify the problem by determining its boundaries.
Boundaries are simplified by breaking the problem into smaller manageable sub-problems. In
problem formulation, establishing relations with some problems that are solved earlier prove
quite useful.
2.) Design phase includes inventing or developing various alternatives in order to get the
best possible alternative . Developing alternatives is a time-consuming and crucial activity,
as the decision-maker has to explore all the possible alternatives. Decision-maker should
not take risk of missing any given alternatives since the missed-out alternative might be the
best one from the given alternatives. Developing alternatives is a creative activity, which
can be enhanced by various aids such as brainstorming , checklists and analogies.
3.) Choice phase refers to the selection of an alternative developed in the design phase as
the decision-maker. A decision-maker makes a detailed analysis of each and every
alternative for performing this selection. After making a decision, the decision is
implemented . However, at any phase, the decision-maker may return to the previous
phase. For example, the decision-maker in the choice phase may reject all alternatives and
return to the design phase for developing more alternatives.