Decision Making: Risk Management, Systems Thinking, and Situation Awareness - Research Paper Example

The real meaning of management is decision-making. Managers are continually required to analyze alternatives and make decisions concerning a wide range of issues. Just as there are various managerial models, there are various decision-making models. Making decisions involves risk and uncertainty, and decision-makers have different levels of risk aversion. Making decisions also involves quantitative and qualitative analysis, and several decision-makers favor one type of analysis over the other. Decision-making can be impacted by not only reasonable judgment but also non-rational elements like the personality of the person making a decision, organizational situation, peer pressure, and others (McLucas, 2003).

For one to ensure that they are making a good decision, a manager should build a constructive environment. This can be done by establishing objectives, agreeing on the process, involving the right people, and allowing opinions to be heard. Secondly, a manager should be able to generate good choices and explore them. After choosing the best alternative, a manager should check the decision to ensure that it is the best decision (McLucas, 2003). In the realm of decision-making, an assumption believes something will be accomplished or understood devoid of explanation concerning what is expected. As a manager of one of the departments in my company, I delegated a task to each of the subordinates. One time that is I assumed believed a certain subordinate knew how to prepare a cashbook. He did not know how to prepare a cashbook and so when it was presented to the boss, he was furious and I had to re-do the cashbook again. After scolding the subordinate, he pointed out that I had not shown him how to prepare a cashbook. This is the impact of assumptions in decision-making (McLucas, 2003).

A decision for an automobile firm to assume that there would be a continuous demand for SUVs since gas prices were expected to continue rising was a bad choice. Historical progressions ought to be analyzed. The price shoot-up drives people to want more gas effectual cars. Projections by experts can assist in predicting the future trend in car purchasing. This assumption will destroy automobile companies since they will witness a reduction in SUV purchases, as long as fuel prices rise. Taking the correct approach to decision-making progression, will assist a manager in consistently accomplishing their landmarks and be less likely to acknowledge important facts. Effectual, executive, decision-making will develop efficiency (Ullman, 2006).

In conclusion, managers should always ensure that the objectives of decision-making are clear both to themselves and to the persons involved in the decision-making process. With very many choices and associated attitudes concerning what one should do, people normally pressure themselves into making a choice. It normally helps to re-analyze their situation. One should ensure that their choices are really good and their timing right.