Decision Making Model

Decision-making model

The decision-making model is the process or framework that analyzes the suitable and feasible solution to the problem. It explores the feasibility of various alternatives and determines the suitable and best alternatives to solve the problem. In this way, the decision-making model determines the best decision-making.

Various decision-making models are implemented to solve the problem or to make the right decision that fulfills the need of the organization. Decisions are taken in different ways depending upon what problem is going to be solved or what purpose the decision going to be taken for.

Rational decision-making model

Define the problem or purpose for which the decision-making implemented

The first stage of the rational decision-making model is to determine the problem or the purpose for which the decision-making is going to be done. This stage explores the actual reason or the need to make decisions and the various alternative solutions to solve specific problem. So this stage identifies those problems that need to be solved by various alternatives or by making the right decisions.

Determine the criteria to evaluate the alternatives

Defining the criteria decides the priority while selecting the various alternatives. In the rational decision-making model, this stage plays a very important role in evaluating the various criteria for creating alternatives to solve the problem. Criteria can be used to consider and evaluate the various alternatives to decide the suitable and write decisions that can solve the problem or purpose.

Example

1. In the recruitment and selection process of any organization HR manager sets the criteria for making decisions regarding recruitment and selection of required potential candidates. Criteria for selection may consist of a minimum of 2 – 3 years of concerned experience, it may consist of educational qualification for a specific post for which the recruitment and selection process going to be executed.
2. The Marketing Management Department of any organization involved in selecting the potential segments of the market considering the various criteria. These criteria choose the potential segment required for the organization. Criteria may consist of demographic factors, geographic factors, and psychographic factors that are suitable for the organization such as age, income, habit, frequent users, etc.

Weigh the criteria set for decision-making

          The stage of the rational decision-making model involves analyzing the criteria set for decent making. The criteria of whether it’s suitable feasible and right for making the decisions is essential to decide. Distance This stage of the rational decision-making model deals with measuring and determining the criteria to ensure the suitability of the required decision-making for solving the problem.

Example

1. In the recruitment selection process of an organization the credit asset HR manager needs to analyze whether it can be feasible and suitable for conducting this activity in the organization. If the criteria are blocked to the number of years of experience for the candidate then it is essential to know whether such candidates are available easily, whether candidates can join the organization’s expected salary, whether can they sustain themselves in the organization for the longer, etc.
2. marketing management and department Select the potential and write a segment that is suitable and profitable for the organization. This stage of the rational decision-making model measures the segment by considering factors such as organization profitability, feasibility, risk factors in the future, affordability of the customers, consumer buying behavior, etc.

Creation of alternatives

Once the problem of the purpose is identified and the criteria set to take the decision, the next stage is to generate various possible alternatives required to solve the problem. These alternatives are made considering the criteria set for generating appropriate and suitable alternatives.

Examples

Marketing management departments generate the following alternatives to select potential segments for business growth.

Based on income various segments are created such as

Income level from 1 lakh to 5 lakh

Income level from 5 lakh to 10 lakh

Income level from above 10 lakh.

Segmentation can be made based on geographic criteria such as North India, South India, East India, and West India. Segmentation can to made based on psychographic factors such as frequent users, occasional users, and moderate users of a product or service.

Several alternatives can be made to find out the appropriate solution which is suitable to solve this problem.

Determine or Selecting the right alternatives

This stage Of the rational decision-making model Determines the right alternatives that are suitable to solve the problem of whether the decision-making model is executed or implemented. To determine the suitable alternative it is essential to conduct a feasibility study considering various factors.

Examples

1. Marketing management departments create various segments of the market based on various demographic geographic psychographic factors. These created or generated various alternatives for solving the problems need to be evaluated to determine whether and which is the suitable segment for the business organization.

This stage determines whether demographic factors are essential for the segmentation of geographic factors or psychographic factors. By selecting the right factors for segmenting the market the organization can address the potential segments for the further stage that is positioning. After selecting the right ratio of segmenting the market they can segment the market and select the right segment based on various factors such as profitability feasibility and unacceptability of the products.

• The human resource management Department of the organization conducts the recruitment and selection process and selects the right way of conducting this process. Alternatives created include recruitment conducted by online platform, print medium or references of employees and selection made by using various methods. Choosing the right methods or the ways that need to be implemented for the conduction of the recruitment and selection process is the concern of this stage.

The selection of wrong alternatives leads to favorable results for the organization. Suppose the human resource management department of the organization selects the right alternatives to influence or create favorable results. Right candidates contribute to the growth and profitability of the organization whereas a wrong candidate selection due to wrong alternatives causes losses to the organization. Hence the final stage of selecting the various alternatives paste or the right alternatives out of many alternatives plays an important role in the success of the organization.

The rational decision-making model always focuses on identifying the right problems and generating suitable solutions to solve those problems which gives better results for the organization.