The importance of analysis and analitical skills to the manager making decisions in business - Essay Example

?Running head: The importance of analysis and analytical skills to the manager making decisions in Business The Importance of Analysis and AnalyticalSkills to the Manager Making Decisions in Business Insert Name      Insert Grade Course Insert Tutor’s Name 31 December 2011  The Importance of Analysis and Analytical Skills to the Manager Making Decisions in Business Introduction Managers in different organizations participate in decision-making processes with the aim of choosing or selecting the best alternative courses of action in achieving set goals in an organization (Pedrycz, Ekel, and Parreiras, 2011). Decision-making cannot be divorced from management, where decision-making process has become critical and vital to overall managerial functions. At the same time, decision-making process can be associated with planning where the aim is always to identify what should be done, when it should be done, where the action should take place, and who should undertake or perform the action (Forman and Selly, 2001). In this way, functions related to management such as organizing, implementing and controlling are seen to be heavily dependent on decision-making. Different decision-making approaches are available and will be discussed, and the appropriateness and weakness of each approach will be considered. Moreover, the complementarily of the approaches will be evaluated to ascertain the suitability and ability of the approaches to provide management with opportunity for enhanced decision-making process. Business opportunity of get fit quick Competition, coupled with increased changes in the business environment, has combined to execute powerful impact on the way managers and their different organizations conduct businesses. In this regard, organizations have been forced to develop and implement the most sophisticated decision-making techniques in order to ensure available resources are economically and optimally utilized (Nutt and Wilson, 2010). In order for business to get fit quickly and successfully, managers are required to explore the different available alternatives of decision-making. The alternatives should have the ability to outline, in the most efficient way, how the organization can make use of the available resources in a way that differs from competitors and give returns that enable the business to create competitive advantage (Casey and Capella University 2006). Available resources in an organization can be used in ways that provide opportunity for the organization to achieve maximum utility. However, this is possible through selecting the best alternatives of decision-making as it pertains to resource utilization, environmental scanning, and goals to be achieved. Approaches of decision-making process Management literature depicts that decision-making process can benefit greatly from the four main approaches that are generally used in making decisions. As a result, in order for decision-making process to be successful and productive, managers are either to select one or multiple approaches that include logical systems approach, contingency approach, quantitative approach, and the qualitative approach. Logical systems of decision-making are premised on the rationality essence that is needed to make decisions (Wysocki 2010). In this case, an individual (manager) is perceived to have rational set of stages that should be followed before arriving at the appropriate conclusion regarding decision (Wysocki, 2010). Contingency approach on the other hand categorizes or program alternatives that can be used to achieve decision goals (Sengupta and Bhattacharya, 2006). A problem is presented to have different ways of solving it and this lead to development and evaluation of different ways of finding solution. On the other hand, quantitative approaches dictate that, decision-making process succeed when concept such as project management are adopted (Anderson, 2011). In this way, figures are seen to possess great ability of providing management with chances of finding solution to major decision goals. Qualitative approaches require managers to be problem seekers for the best alternatives that provide needed quality (Anderson, 2011). The approaches postulate that, quality is the essence upon which managers can gauge between different alternatives available. Given that the business opportunity in perspective looks for ways and opportunities to get fit quickly in terms of growth, revenue generation, operation, sustainability, and so on, there is need to evaluate the most appropriate models of decision-making. Two models are considered: project planning and database management. The choice for these models is premised on the fact that, having in place goals to get fit quickly in the business opportunity, there is need for the business to identify the most appropriate projects (business opportunities) and the subsequent project management techniques to be used. In similar way, identified projects or opportunities are likely to succeed with employment of appropriate and sophisticated technology as compared to competitors or other players. The technology to be incorporated in the projects should be integrative in nature making projects have ability to realize success. Project planning and management Successful business opportunities are the one in which a clear path is drawn, appropriate time of accomplishment allocated, and resources required apportioned in the most efficient manner (Lewis 2010). Moreover, such business opportunities do not only operate in isolation ones started but largely require frequent and thorough evaluation and reviewing to ascertain level of success and subsequently develop modifications to ensure success. Therefore, project planning and management has become one of the decision-making approaches management teams in various organizations utilize especially with regard to goals of establishing fit and achieving market competitiveness. Business opportunity can be regarded as a project (problem) that needs to be explored and solved appropriately. In undertaking this, key resources are to be used and a procedural and definite pathway is to be adopted in accomplishing the project. Project planning can therefore be perceived to constitute activities performed in a structured manner with aim of achieving set goals given the available resources and opportunities (Lewis, 2010). Project planning and management has therefore become the avenue in which management team can execute business idea in the market and have ability to measure and control the management and performance process of the idea. Through project planning and management, the management is able to establish the most appropriate means of assigning personnel, scheduling activities, achieving cost control, and many more (Lewis, 2010). In most project planning and management approaches to decisions, management is presented with an opportunity to align requirements, assignments, costs, and schedules in a more precisely manner and order that eventually makes it possible to carry out comparison of the actual input and output of the projects (Hayes, 2001). Moreover, problems available in the project can be identified and rectified immediately thus giving the project time and ability to succeed and achieve objectives. Some of the notable project management techniques that have become widely used in decision making processes include the Gantt chart, program evaluation and review technique (PERT), critical path method (CPM), and the line of balance (LOB) techniques (Hayes 2001). It must be noted that, as the business environment become increasingly uncertain and full of competition and dynamism, there is need to have probabilistic predictions that provide ability and capability for the organization to achieve the set objectives with regard to new business idea. In project planning, the management identifies the right resources, scan the environment, and select the most cost-effective projects to implement. Throughout this, the essence dwells on having a clear and predictable picture of the future as far as the success and sustainability of the project is concerned. Project planning and management, as an approach widely used in management decisions, can be seen to have benefits or advantages, which explain its preference as choice. First, project-planning techniques provide managers with opportunities to analyze and evaluate the different available opportunities and uncertainties (Sivarethinamohan, 2008). Through this, it becomes possible to analyze the factors and issues likely to affect the success of project in advance. Forecasting is the essence and avenue of successful charting through uncertainties. As a result, project planning has become a tool through which decision-making can be achieved with regard to progress of the project, impact and how likely it is to perform in the market (Sivarethinamohan, 2008). Pitfalls in the project can also be forecasted and appropriately dealt with before impacting the project. At the same time, project planning and management as decision tool enables realization of maximum control of project, which eventually results into the project sticking to its objectives and goals. This at same time ensures efficient use of resources in the most effective way. Furthermore, strength of project planning has to do with its ability to remain flexible in terms of constant review and updates, which results into constant modifications making realization of goals more achievable. Lastly, this decision making tool facilitate and promote communication in the organization, which generally leads to success of the business idea being implemented since diverse and productive input in present. Weaknesses or limitations of this decision tool can be linked to its inability to perfectly be reliable. In most instances, the time and cost estimates made are inaccurate, a situation that normally impact projects and sometimes increase errors present in the project. Furthermore, project planning as a tool has been perceived to only achieve goals where relative long time of the project is concerned. This in fact may not auger well in short-term projects, which may be more lucrative. Lastly, the tool is seen to be ineffective to projects that in nature are repetitive (Sivarethinamohan 2008). Database management As it was seen earlier, implanting business idea that has the ability to fit quickly in the dynamic business environment require sophisticated information for decision-making. Business intelligence has therefore become the main vessel in which business information can be generated and used for management decision plans. Business intelligence involves gathering, storing, and making use of various types of information by any organization (Burstein and Holsapple, 2008). As business environment become competitive, managers need to have competitive information tools for planning and decision-making. The information tools need to improve or guarantee timeliness accomplishment of the project and add quality to the project with aim of winning in the market place. Business intelligence thus is sub-set of database management, which in modern world has become critical decision-making tool in management (Burstein and Holsapple 2008). Database management as decision-making tools are seen to have the ability of generating information and data that is action-based, at the right time, at the right place, and in the right way (Narang, 2006). Therefore, by adopting database management tools, management teams actually aim to improve the performance of a particular project through enhanced information and data concerning the various stakeholders the business depend upon for its sustainability. Database management as it appliers to business intelligence implies that, the competitiveness of the business environment can be established and monitored over a period of time and this is likely to give management team ability to predict the future performance of the market based on intelligence market information collected. Database intelligence reports, which decision-making is likely to be based on include reports and statistics on sales, product development, inventories, customer profiles, consumption trends, costs, and so on (Sumathi and Esakkirajan, 2007). Projects that succeed are those that utilize enhanced data about the general environment. At the same time, due to increased competition, data is critical for projects that need implementation and management as this will ensure enough information is available to deal effectively and productively with the setbacks likely to be present. Database management as decision-making tool possesses certain strengths that make it as the choice of many managers. First, there is wide availability of data and subsequent information, which makes it easier and more appropriate in decision-making as different alternatives are available (Sumathi and Esakkirajan 2007). In addition, compared to other decision-making approaches, database management seems to be cost-effective when the right database is designed and implemented (Burstein and Holsapple 2008). Data available upon which action or decision can be made is perceived to have maximum integrity since it is generally correct and harbor fewer errors (Sumathi and Esakkirajan 2007). As a result, the data available can be relied upon to make far-reaching decisions in the organization. At the same time, database are perceived to offer maximum data security where accessing business intelligence data is only to a few decision-makers and through this, competitiveness of projects is likely to be realized since competitors may be having less of such data. The use of complex database structures in decision-making provides more strength for the success of the project being implemented and this is likely to ensure the organization achieves set goals more appropriately and at faster rate. Limitations of this decision making tool is reflected in the fact that, database management tools are likely to fail thus jeopardizing the entire process of decision-making (Perry, 2007). This is likely to affect the projects or business ideas being implemented or the planning process is likely to stagnate. This is usually evident in cases where expertise with regard to database management and operation is inadequate in the organization. Another limitation of this tool is reflected in its inadequacy regarding contingency planning (Perry, 2007). This is so given the fact that, files and data stored in one location for decision purposes is likely to be risky hence increasing cost and time in managing them. Complementary use of managing decision methods As business environment become complex and uncertain, there is likelihood that one approach to decision making may not be adequate or may not give the best solution required to achieve competitiveness in the business environment. As a result, there has been emphasis of complementing decision-making approaches in order to enhance decision in the management. Complementing may integrate two or more approaches depending on the nature of business, resources available, and the objectives the business intend to achieve (Parker, 2005). Moreover, in order to have the right combination of approaches, there is need for evaluation of each approach to establish its suitability for integration or complement. Establishing business competitiveness in the market and wider environment of operation require sophisticated business intelligence that is coupled with proper project planning. In other words, proper and productive project planning and management can only succeed when there are enough business intelligence data. In this way, project planning and management approach can simultaneously be complemented with database management approach where each will depend greatly on the other for success. In order to realize the best results as far as business operation is concerned, complementing the two approaches require detailed communication, participation, and enhanced business environment scan. Therefore, the priorities and objectives set by the organization should be weighted against the generated business intelligence reports; this should later lead into adopting the most efficient and effective decisions by the management to implement business opportunities. Conclusion Organizations possess or formulate diverse number of goals and to achieve these goals require investment of enormous resources. As a way to have the best outcome, management teams in organization have to participate in activities of organizing, planning, operation, control, and so on, in order to make sure that the entire process of achieving the goals is successful. Thus in order to be able to fully engage in these functions and successfully realize optimal goals, managers engages in continuous decision-making process. To this extend, decision-making process is perceived to be critical element in the success and continuity of an organization as it engage in evaluating different available alternatives and ultimately choosing the best option or alternative. In making decisions, management teams are likely to explore and make use of the different approaches available. Reference List Anderson, D. R., 2011. An introduction to management science: quantitative approaches to decision making. OH: Cengage Learning. [Online]. Available at: http://books.google.com/books?id=IAOho8E1Qm0C&printsec=frontcover&dq=management+decision+making+approaches&hl=en&sa=X&ei=IHr9TundEeHb4QTUqr1J&redir_esc=y#v=onepage&q&f=false [Accessed 29 December 2011]. Burstein, F., & Holsapple, C. W., 2008. Handbook on Decision Support Systems 2: Variations. NY: Springer. [Online]. Available at: http://books.google.co.ke/books?id=kqcA4Ay8f5AC&pg=PR39&dq=data+management+in+decision+science&hl=en&sa=X&ei=7az9ToHOLsTT4QSmsdCNCA&redir_esc=y#v=onepage&q=data%20management%20in%20decision%20science&f=false [Accessed 29 December 2011]. Casey, W. W., & Capella University. 2006. The relationship among decision-making approaches, system thinking, and decision speed: An explanatory study. IL: ProQuest. [Online]. Available at: http://books.google.co.ke/books?id=AARqHb5qAboC&pg=PA1&dq=management+decision+making+approaches&hl=en&sa=X&ei=IHr9TundEeHb4QTUqr1J&redir_esc=y#v=onepage&q=management%20decision%20making%20approaches&f=false [Accessed 29 December 2011]. Forman, E. H., & Selly, M. A., 2001. Decision by objectives: how to convince others that you are right. World Scientific. [Online]. Available at: http://books.google.com/books?id=Oa5baCLC1GoC&pg=PA1&dq=management+decision+methods&hl=en&sa=X&ei=Adv8TrP3K8Tu-gac7ImuAQ&redir_esc=y#v=onepage&q=management%20decision%20methods&f=false [Accessed 29 December 2011]. Hayes, R. M., 2001. Models for library management, decision-making, and planning. Emerald Group Publishing. [Online]. Available at: http://books.google.com/books?id=RzD1-63APNEC&pg=PA1&dq=management+decision+methods&hl=en&sa=X&ei=dIz9TpfDLKzb4QTIg9WNCA&redir_esc=y#v=onepage&q=management%20decision%20methods&f=false [Accessed 29 December 2011]. Lewis, J. P., 2010. Project Planning, Scheduling and Control: Bringing Projects in on Time and on Budget. New Delhi: McGraw-Hill Professional. [Online]. Available at: http://books.google.com/books?id=lT8MmL1tLcMC&printsec=frontcover&dq=project+planning&hl=en&sa=X&ei=WZD9Ts27MIHf4QTLh9CNCA&redir_esc=y#v=onepage&q=project%20planning&f=false [Accessed 29 December 2011]. Narang, R., 2006. Database Management Systems. New Delhi: PHI Learning. [Online]. Available at: http://books.google.co.ke/books?id=DYIMddl3VuAC&printsec=frontcover&dq=data+management+systems&hl=en&sa=X&ei=-639Tp_LFcTi4QTwhbiwBA&redir_esc=y#v=onepage&q=data%20management%20systems&f=false [Accessed 29 December 2011]. Nutt, P. C., & Wilson, D. C., 2010. Handbook of Decision Making. MA: John Wiley and Sons. Available at: http://books.google.com/books?id=n1yxhBDxL2QC&pg=PA23&dq=complementing+decision-makin+approaches&hl=sw&sa=X&ei=KcD9TrrcE87E4gSzhMSNCA&ved=0CEcQ6AEwBA#v=onepage&q=complementing%20decision-makin%20approaches&f=false [Accessed 29 December 2011]. Parker, B., 2005. Introduction to globalization and business: relationships and responsibilities. NY: SAGE. Available at: http://books.google.com/books?id=8_MZt3z92BkC&pg=PA462&dq=complementing+decision-makin+approaches&hl=sw&sa=X&ei=KcD9TrrcE87E4gSzhMSNCA&ved=0CC4Q6AEwAA#v=onepage&q=complementing%20decision-makin%20approaches&f=false [Accessed 29 December 2011]. Pedrycz, W., Ekel, P., & Parreiras, R., 2011. Fuzzy Multi-criteria Decision-Making: Models, Methods and Applications. MA: John Wiley and Sons. [Online]. Available at: http://books.google.com/books?id=xjvuNd3wwmsC&pg=PT24&dq=project+planning+and+management+decicion+making+process&hl=en&sa=X&ei=eVr9TpeMLoPd4QSd66TuAQ&redir_esc=y#v=onepage&q=project%20planning%20and%20management%20decicion%20making%20process&f=false [Accessed 29 December 2011]. Perry, B., 2007. CIMA Official Learning System Organizational Management and Information Systems. PA: Butterworth-Heinemann. [Online]. Available at: http://books.google.com/books?id=y2fv-5ljjzwC&pg=PA18&dq=advantages+and+disadvantages+of+database+management+tools&hl=en&sa=X&ei=A7f9TuSIGNCK4gS78MCNCA&redir_esc=y#v=onepage&q=advantages%20and%20disadvantages%20of%20database%20management%20tools&f=false [Accessed 29 December 2011]. Sengupta, N., & Bhattacharya. 2006. Managing Change in Organizations. New Delhi: PHI Learning Pvt. Ltd. [Online]. Available at: http://books.google.com/books?id=JkwgzACX6N4C&pg=PA253&dq=contingency+approach+of+decision+making&hl=sw&sa=X&ei=XoD9ToelLezc4QS4qpzxBQ&ved=0CDIQ6AEwAQ#v=onepage&q=contingency%20approach%20of%20decision%20making&f=false [Accessed 29 December 2011]. Sivarethinamohan, R., 2008. Operations Researches. New Delhi: McGraw-Hill Publishing. [Online]. Available at: http://books.google.com/books?id=Kc6y14jtkYYC&pg=PA433&dq=advantages+and+disadvantages+of+PERT+and+CPM+techniques&hl=sw&sa=X&ei=WZf9TqOSL_HT4QSF4d2NCA&ved=0CCwQ6AEwAA#v=onepage&q=advantages%20and%20disadvantages%20of%20PERT%20and%20CPM%20techniques&f=true [Accessed 29 December 2011]. Sumathi, S., & Esakkirajan, S., 2007. Fundamentals of Relational Database Management Systems. NY: Springer. [Online]. Available at: http://books.google.com/books?id=RjnNA0GW0wsC&pg=PR8&dq=types+of+database+management+systems&hl=en&sa=X&ei=FbL9TsDbG8Hm4QSL482NCA&redir_esc=y#v=onepage&q=types%20of%20database%20management%20systems&f=false [Accessed 29 December 2011]. Wysocki, R. K., 2010. Effective Software Project Management. MA: John Wiley & Sons. [Online]. Available at: http://books.google.com/books?id=n3ry2WtdTbMC&pg=PT631&dq=organizational+behavior+in+action:+skill+building+experiences&hl=en&sa=X&ei=1X79Tqi5BOWJ4gTchfyOCw&redir_esc=y#v=onepage&q=organizational%20behavior%20in%20action%3A%20skill%20building%20experiences&f=false [Accessed 29 December 2011]. Read More