Information Based Decision Making - Term Paper Example

Introduction An organization has the responsibility to think and decide on the issues. The decisions should be made after conducting analysis and investigation. Decision is an important part of any organization and it must be made with utmost care. The company must realize the seriousness of the decision and must act accordingly. The data and information required to make a decision must be gathered and analyzed. This will help the organization to make a better decision. A decision must be taken after analyzing its pros and cons. Hence a decision has to be taken keeping in mind all its consequences and effects. In general a decision is made depending on the situation and the issue. The decision made cannot be favorable for everyone in all circumstances. It may lead to improvement or adverse effects on the situation. The information from the concerned department is the important part of decision making process. Information Based Decision Making A decision is made only after collecting the relevant information. Thus information plays a major role in any decision. As a strategic manager I should design a strategy that helps in the process of decision making. This strategy must incorporate the plans that improve the existing situation. The strategy should consist of step by step procedure. The data and information must be selected when using the information based decision making. The nature of the data is an important aspect of information based decision making. (Johnson, 2008).The decision can be made only based on the nature of data. To get the data the data source must be selected well in advance. Once the data source is selected the corresponding data can be retrieved from the specified source. The identification and selection of data involves ascertaining the nature of data, data selection criteria and analyzing the legal requirements of data collection and storage. These are outlined in the following steps. Nature of Data and Information Data is generally given as an input to the corresponding information system. The raw data is processed in the system after which it is given as an output. This output is referred as the information. Data can be in the form of a text file, image, video or an audio. Hence the data can be in any format that is understandable by the respective information system. This data is processed to form complete information. Data is an abstract type of information. The data can be either quantitative or qualitative. The nature of data has gone through various phases of improvement. Due to the latest technologies and the advancements, data's nature is completely different when compared to the initial stages. The nature of the data and the information must be assessed so that the decision is made according to the nature and type of data. The type of data may also differ from one system to another. The decision will differ based on the type of data. The processed information is then analyzed after which the next step begins. Criteria for Data Selection Data selection is an important aspect of information based decision making. Data selection is done based on various criteria. The data must satisfy the criteria to enter in to the system. The data selection criteria are designed in a complicated manner. This is done to make sure that the data is of high quality. The criteria help in deciding whether the data is suitable for future reference and processing. There are various selection criteria and the suitable criteria are selected based on the type of data. The selection criteria are divided into various parts. The technical and scientific criteria are the ones that are widely used. If the data satisfies the predefined criteria, then it is decided that the data can be used in for decision making. If the data does not satisfy the selection criteria, then it is discarded. The particular data is not used for the processing in the information system. (Johnson, 2008). The scientific data selection criterion is the first among the data selection criteria. The selection criteria include the various aspects like data size, relevance and the scope of data. The data is checked whether it is relevant to the topic on which the decision is made. An analysis is made to confirm that the data pertains to the particular system. The size of data is the next option in the selection criteria. The variables used in the data contribute to the size of data. To calculate the size of the data the variables used and the length of data is used. The scope of the data is the next part of the criteria in which the importance and reliability of the corresponding data are validated. The technical criterion is the second part of the data selection criteria. The data format, size and the transfer media constitute the technical part of data selection. The format of the data is one among the technical criteria. Format of the data specifies how well the data is organized and maintained in the system. It is also checked whether the data can be stored in normal format specified in the system. Certain file formats lose some parts of the data during conversion or file compression. The data is checked against this concept to avoid loss of data. The final aspect of technical criteria is the media that is used for transferring the data. In this part of criteria the data is verified with the transfer methods. The type of data and its format may get changed while using certain transfer methods. The data must satisfy all these criteria and then only it will be selected for decision making. Legal Requirements for Data Collection and storage The data collection and storage is a tedious process. This process cannot be done at a single stretch. Instead there are some predefined tasks that have to be fulfilled. The collection and storage methods have changed and more attention is paid to collection and storage nowadays. Data collection is a prolonged process that requires various operations. Initially the data is collected, analyzed and stored in a centralized system. Since the numbers of security issues are increasing, the companies must concentrate on storing the data in a well secured environment. There are certain laws that are defined for data collection. Any organization must abide by these laws. The company must install a separate system to monitor the activities that take place within the system. Since the systems within an organization are connected in a network, a network monitoring system is essential. (Johnson, 2008).There are many ways to gather and store data. These operations can be done legally by following the specified methods. The companies have a predefined policy based on which the data storage and retrieval is performed. According to these policies and governmental rules, the organization must gather and store data only for a specified period of time. This depends on the type of organization. Data handling must also be done by following the rules and regulations of the organization. Data collection and storage must be performed by following the company's guidelines. These guidelines specify the methods that have to be followed during data collection and storage. The do's don'ts of data storage and retrieval are also specified in the guidelines. The company must be registered in the government's list of companies. This will ensure that the company follows the government's procedures and the operations that take place in the organization are legal. There are laws that specify how information can be used. These laws propose regulations that specify which types of activities related to data are legal. These activities are permitted and any organization or individual can access the data by following these methods. The common data available in the internet is available for public use. Any individual can access it and make use of the data, whereas there is certain information that requires authentication. These data cannot be accessed without the legal rights and access rights. The organization forms these authentication rules and any person who violates these laws will face severe consequences. Decision Making Models Decision making is a process that requires more analysis and research. Decision making cannot be made in a simple way. Instead it has to be made with the help of decision making models. These decision making models must be implemented in each and every organization whenever a decision has to be made. The models support decision making and makes the process easier. This can be achieved only if appropriate decision making model is selected. The model should be selected based on the organization and the situation in which the decision has to be made. Decision making models not only assist in decision making but helps in the growth of the organization. There are several decision making models that a company can select and implement. Rational Model Rational model is one among the popular decision making models. This model is widely used and almost all the organizations use this model to make decisions. This model analyses the advantage sand disadvantages of any decision and gives a solution to the existing problems. By implementing this model the prevailing problematic situation can be improved. This model selects the decision that will help in the development of the organization. The reliable and logical option will be selected from the other options. Since rational model selects the most reliable decision, it is preferred by the management. The only disadvantage of this model is it consumes more time when compared to other decision making models. The required information must be gathered well in advance and requires more preparation. Rational model constitutes of a structured sequence that contains four steps. The problem is identified in the first step and the factors responsible for the problem are analyzed. The solution for the corresponding problem is stated and the model suggests the alternative methods to deal with the existing problem. Then the relevant solution is selected based on the result from the previous steps. Once all the three steps are implemented, the final step of implementing the selected solution is made. This will resolve the problem and will help in the improvement of the organization. Seven Step Model The seven step decision making model consists of seven steps that point out the best decision and guides the organization. The information must be provided in order to select the best decision. Then depending on the information the decision alternatives are designed and analyzed. Once the information regarding the decision is provided it is analyzed and a research study is conducted to know more about the information. Then the relevant information is segregated from the unwanted information. (Johnson, 2008). This is done to make sure that only valid information is considered in decision making process. After separation of the valid information the process of decision making is carried out. In each of the steps the information is filtered and the relevant data is presented to the management. Intuitive Decision Model Intuitive decision making model is preferred only by certain organizations. Since it does not include any strategy, the model is given less importance. A strategy is necessary for any model to incorporate the necessary changes. Intuitive decision making model is completely different when compared to the other decision making models. The information pertaining to the decision is made available and the model keeps track of the information. Though the information is provided to the model, it does not provide any effective solution. As the solutions are not well received within the organization, the model is not popular among the organizations. The decision made with the help of intuitive model does not yield any benefit to the organization. Ultimate Decision Model The ultimate decision making model permits the organization to collect all the required information. The information from the past and the changes in the data are stored in a separate database. This database is analyzed before coming to a conclusion. This model has more advantages when compared to the other models and works on the available information. The decisions are accurate and lead to a problem free situation. The decision can be made according to the company's status and the decision making is done within the stipulated time. This is achieved since this model does not require more time to select the given alternate decisions. As the strategy manager of the organization I must select a model that will serve the intended purpose. I would select the rational decision making model as it selects the best and reliable options from the given alternatives. Presenting the Decisions This process should be carried out once the decisions are made. The decisions must be made only after consulting the staffs in the organization. If the change or decision is made only to a particular department, the staffs and the manager of that department must be kept informed about the decision. Since the staffs may have some problems in the existing system, they will provide the entire information regarding the system. This will enable the management to make a proper decision that will bring about positive changes in the organization. The decision must be informed to the staffs working in the organization. The decision should be presented in such a way that it convinces the employees. The management is responsible for the decision making process and they should decide on the method of presenting the decision to the employees. The decision can be presented to the employees by using the various methods that assist in the presentation of decisions. Communicating Decisions Communicating the decisions is the final step of decision making process. There are several methods to communicate the decisions. The organization must select a method to communicate the decision. Block method is one among the effective methods to communicate the decision. In this method the system is divided into several blocks. This is done to make the decision making process easier. As the system is divided, the collection of information and the processing can be done at a faster rate. This will enable the decision making process to be completed in a short time period. The blocks are of same structure and the contents in the block remain the same. The description of the decision and the arguments are prepared before the communication begins. The relevant information are combined and integrated to form a single unit so that the communication can be done in a well structured manner. There are several advantages in this block method. (Johnson, 2008).This method is simple and the aim of such change or decision is specified in the method. This method will be suitable to any type of organization and it is flexible. The employees in the organization can participate in the communication process. Implementing the Communication Method Once the communication method is chosen the next step is to implement the communication method. The method is implemented in the organization to effectively communicate the information regarding the decision. The information to be communicated must be stated in the method. By doing this the data regarding each department and the changes obtained thorough the decision can also be provided to the employees. Conclusion Decision making is a tedious process and it requires more time. An organization must decide on the decision and must be prepared to face the outcomes of it. The decision must be taken based on the company's situation and the issues that create problems. Decision must be made only after analyzing the nature of the data and information. The management must select the data by using the data selection methods. The decision can be made with the help of decision models and then the decision must be presented to the employees. It is done by implementing the communication method. Hence a decision is made to improve and develop the organization. Reference Johnson, Gerry., 2008. Exploring Corporate Strategy: Text and Cases. U.S.A: Pearson Education. Read More