Decision Making Theories Free-Samples for Students-Myassignement

Question: Discuss about the Business Intelligence. Answer: Relevant decision-making theories and framework: Decision-making reflects a process through which organizations make choices among different alternative options for creating maximum impact on the business (Hwang and Yoon 2012). Appropriate use of decision-making process has allowed organizations to counter different business related challenges comprehensively. Now, organizations primarily focus on using systematic procedure at the time of taking any critical decision about the operational procedure of the organization. The systematic steps include identification of problems, gather information about different alternatives, select among alternatives, implement decisions and feedback. Therefore, organizations focuses maintain healthy working atmosphere to perform all these steps effectively. Organizational decision-making involves different critical areas like increasing sales volume, reducing operational cost, introducing new technology or products. Therefore, organizations heavily depend on the impact of the decisions for achieving success in the market. As per the article by Elwyn et al. (2012) decisions can be taken in different ways including collective or individual decision making procedure, rational and irrational decision making procedure within an organizational structure. Therefore, organizations try to utilize all As illustrated by Ford and Richardson (2013) programmed and non-programmed decisions that organizations use for countering its daily issues. Programmed decisions focus on the problems that are repetitive in nature. On the other hand, non-programmed decisions focus on new and unique problems that require specific skills and knowledge from the management. For that reason, majority of the organizations allow junior level managers to handle programmed decisions while non-programmed decisions handled by the senior management. Routine decision-making process focuses maintaining general functions of the organizations while strategic decisions involves massive investments and funds. For that reason, top management of the organizations always look to collect as much information as possible at the time of developing strategic decisions so that it can minimize the risk level effectively (Schmoldt et al. 2013). Availability of proper information allows organizations to evaluate different alterna tive options, which is likely to increase the effectiveness of the operational process. Prospect theory of decision-making has highlighted two prime factors including value functions and decision weight functions. Value functions focuses on assessing people tendency to evaluate outcomes in terms of losses and gains. On the other hand, decision weight function focuses on highlighting the way individuals implicitly weight probabilities by connecting choices to outcomes by estimating small probabilities with large one. It highlights the fact that organizations often try to experiment with small investments for understanding the exact potential of a particular decision. However, it has been assessed that it might not reflect the actual situation, which can increase the risk level even further. Pettigrew (2014) has mentioned that it is necessary to identify and assess all the probable alternatives at the time of taking any decisions for organizational success. Therefore, it has increased the significance of collecting and analyzing all the available data in an in-depth manne r for increasing effectiveness of the decision-making process. Therefore, data driven decision-making process reflects future way of developing critical decisions for ensuring continues growth in the market. Definition of data driven decision-making: Data driven decision-making reflects an approach to conduct all the business activities based on the verifiable data (Kemper et al. 2013). In the modern business atmosphere, all the organizations are looking to use available data before implementing any decisions. Therefore, significance of data analytics department has increased in a considerable manner over the past few years. For that reason, the terms like big data and data warehousing are becoming extremely popular, data driven decision-making procedure allows organizations to make relatively fast decisions, which has created major impact on the effectiveness of the operational procedure. As per the article by Schmoldt et al. (2013), data driven decision-making procedure is around 6% more profitable and 5% more productive on an average to any other decision-making process. It has allowed organizations to stop experimenting with different alternatives, which eventually created positive impact on the business procedure. Importance of changing organizational culture to make transition towards data driven decision-making paradigm: From the above illustration, it can be assessed that organizations use different process for maximizing the impact of decision-making process. Traditionally, many organizations look to involve employees working in different position to provide different perspective about the organizational decisions (Mihart 2012). The present culture of XYZ also focuses on using traditional techniques for implementing key decisions. Therefore, in order to change the decision-making paradigm to data driven decision-making approach, organization will have to make transition on present culture. The management of XYZ will have to provide proper information to the employees regarding the necessity of using data driven decision-making approach for fulfilling all the business objectives. As illustrated by Bouyssou et al. (2013) both psychological and rational decision-making process has people as their prime factor either as the decision makers or as the one who can affect the decision. Organizational cultu re determines the values, beliefs, feelings and behavioral pattern of the employees. Data driven decision-making induces management to focus more on data rather on intuition. For that reason, it might induce managers to think that they are losing importance within the organizational structure, which can lead to different operational challenges (Hwang and Yoon 2012). Therefore, management of XYZ will have to focus on developing such organizational culture that happily accepts any changes the decision-making and operational procedure. Otherwise, it might have to face huge amount of challenges in implementing any changes in the business procedure. Culture is also described as a pattern of shared assumptions that a particular group learns at the time of solving external and internal integration problem. Therefore, culture helps employees to process information and interprets in different environments (Han and Ryu 2012). XYZ also have to focus on developing such culture where employees from designation will try to gain knowledge from different challenges. It also helps to describe different complex actions of the organizations without facing any operational challenges. Therefore, XYZ will also have to focus on assessing the kind of impact social influences have on the culture. Social influence often restricts organizations from taking any bold decisions in the operational procedure. Now, introduction of new data driven decision-making approach is one of the major change that will affect entire operational activities of the organization (Zimmermann 2012). As a result, it might influence employees to face new challenges at the tim e of fulfilling organizational responsibilities. For instance, data driven decision-making approach might induce XYZ employees to think less at the time of taking an important decisions. In fact, it will induce to focus only on data rather than psychological perspectives. Hence, organizational culture of XYZ will have to focus on developing healthy working atmosphere where employees will look to take challenges that are more complex on regular basis. Moreover, development of proper organizational culture will also allow XYZ to avoid any unethical activities within the business procedure. For instance, it will restrict employees to misuse the data for operational procedure. 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