FACTORS AFFECTING BUSINESS DECISION - 15 Minutes Seminar Notes

 FACTORS AFFECTING BUSINESS DECISION - 15 Minutes Seminar Notes

DECISION MAKING:

• Decision  making  may  be  reviewed  as  the  process  of  selecting  a  course  of  action  from  among  several  alternatives in order to accomplish a desired result. 
• The purpose of decision making is to direct human  behaviour and commitment towards a future goal. 
• If there are no alternatives, if no choice is to be made,  if there is no other way‐out, then there would be not need  for decision making. 
• It involves committing  the organisation and its resources to a particular choice of course of action thought to be sufficient and  capable of achieving some predetermined objective.
  

MAJOR FACTORS AFFECTING BUSINESS DECISION:

Finance

• There may not be finance available to the business to make the decisions they would like to.
  
• For example, a business may wish to invest in new machinery to increase production but they do not have enough capital to allow them to do this.
  

Human resources

The quality of decisions made by managers can be affected by:

• Their skills and expertise
  
• The amount and quality of information they have available 
• The staff involved in implementing the decision need to be willing to cooperate and work with the decision for it to be successful. 
• Senior managers may not agree with the decisions. 
• Existing company policy may restrict the decisions a manger is allowed to make.
  

Technology

• Lack of the correct equipment or technology may restrict the decision - making process.
  

Risk

• Most managerial decisions are made under conditions of risk.
• Decisions are taken inrisk when the manager has some information leading to the decision but does not know everything and is unsure or unaware of the consequences. 

Other factors

The decision-making process may also be affected by:

• Amount of time available to make the decision
  
• External pressures such as exchange rates and economic stability
  

Presented By,

Niveedha

Banking Student

Magme School Of Banking