BUS4101 Week 2 Project

Decision Making

Steps in the Decision-Making Process

Let's use the example of Ivory International to understand the steps in the decision-making process. 

The problem that Ivory International was experiencing was that their sales team was consistently not

achieving their sales goals. In the planning stage of the PDCA cycle, the management of Ivory

International identi�ed cost as a root cause of the business problem, and, accordingly, they came up with a number of solutions. Let's see how the decision-making process helps the management decide

on the most appropriate solution.

1. Identify the problem.

One tube of Ivory toothpaste weighing 184 ounce is priced at $10. This price is beyond the purchasing

capacity of the targeted market segment.

2. Gather and analyze relevant data. The management uses various tools to gather demographic data, competitive market data, and data

about customer expectations. Next, they analyze the data to identify patterns.

3. Consider alternative solutions.

Based on the data analysis, the management proposes a number of alternative solutions, such as

reducing the price of the product and making the product available in smaller tubes.

4. Choose the best alternative.

While weighing the alternative solutions, the management discovers it is not possible to reduce the product price while maintaining the product quality, and compromising quality is not in keeping with

Ivory's quality policy. On the other hand, making the product available in smaller tubes will help retain

the quality and also �t the purchasing capabilities of the targeted market segment. Therefore, the

management chooses the second solution as the best alternative.

5. Implement, monitor, and adjust the chosen solution.

The management then implements the chosen solution, monitors the results, and adjusts the solution to achieve the best results.

While problem solving focuses on �nding solutions to problems, decision making focuses on

preventing problems. Decision making is the process of selecting one course of action from among

multiple alternatives. A well-evaluated decision about the best course of action is expected to achieve

the desired outcomes, goals, and objectives, and thereby, prevent problems. Successful decision

making depends not only on its expected outcome but also on the process employed in making the decision. 

Several individuals may be involved in determining the best solution, which might lead to subjectivity

in the decision-making process. It is important to reduce subjectivity and adopt an objective decision-

making approach. However, even after making an objective and appropriate decision for the

organization, management will still need to make adjustments to the solution so it works most

effectively.