Nobody downloaded yet

Strategic Analysis and Decision Making - Essay Example

Comments (0) Cite this document
It is safe to say that decision making is one of the most significant if not the most essential of all individual and group efforts within an organization. Traditionally, theorists have looked at decision making as the multi-step process by which a problem is recognized, solution objectives are defined, a pre-decision is made (that is, a decision concerning how to make a decision), alternatives are generated and assessed, and an alternative is selected implemented, and then followed up…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER92% of users find it useful
Strategic Analysis and Decision Making
Read TextPreview

Extract of sample
"Strategic Analysis and Decision Making"

Download file to see previous pages Such an ideal model of decision making also presumes that the decision maker is aware of all possible alternatives and that he or she decides subsequent to examining them all. A modern approach recognizes that decisions are made in an automatic, instinctive fashion. Specifically, image theory claims that people will take on a course of action that best fits their individual principles, current goals, and plans for the future.
The decisions made in organizations can be distinguished as programmed -- routine decisions made according to preexisting guidelines -- or non-programmed -- decisions requiring novel and ingenious solutions. Decisions also are different with respect to the amount of risk involved, ranging from those in which the decision outcomes are moderately certain to those in which outcomes are extremely uncertain. Uncertain situations are expressed as statements of prospect based on either objective or subjective information.
For the rational decision maker, the question is "What is the best answer" Rational decision analysis provides a precise method for choosing among alternatives based on their estimated values. The rational model requires the overt specification of the probabilities associated with choices and chances, as well as quantified payoffs for outcomes. For instance, consider the stock option decision tree given in figure 1.1.

Here, an investor is considering buying an option on a stock with a current price of $100. The option itself has a price OP. There is a 50% chance that the stock's price will raise to $110, and a 50% chance that the price will fall to $95:

- Current Stock Price = $100
- Option Price = OP
- With P = .5, S = $110
- With P=.5, S = $95
The investor has two alternatives: Do not purchase the option (choice I), or purchase the option (choice II). Given the above assumptions concerning probabilities and payoffs, rational decision theory gives an exact method for ranking the alternatives. We calculate the expected value of an alternative as the product of its possibility and its payoff value. For the stock option case, we arrive at the following expected values.
EV (I) = P (A) * V (A)
= 1.0 * 0
= 0
EV (II) = P (B) * V (B) + P(C) * V(C) - OP
= .5 * 10 + .5 * 0 - OP
= 5 - OP

The rational choice is to purchase the option if Option Price, OP, $5.We note that this approach formalizes just one aspect of the decision task, that is, choosing among the alternatives. The pattern does not provide exact methods for identifying problems or alternatives, nor for estimating those alternatives. The rationalization that results from this process is always the same: The choice has the highest estimated value. The rational decision maker does not abandon the trouble even if all outcomes have negative expected values. In that case, the decision maker selects for the "best worst" case. The model does not address the matter of generating additional alternatives. Still, rational ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Strategic Analysis and Decision Making Essay Example | Topics and Well Written Essays - 2750 words”, n.d.)
Retrieved from
(Strategic Analysis and Decision Making Essay Example | Topics and Well Written Essays - 2750 Words)
“Strategic Analysis and Decision Making Essay Example | Topics and Well Written Essays - 2750 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
An Individual decision making process analysis project
Form the analysis the project may be launched or shut down. In order to accomplish the above mission, there will be market research to finds its viability, creation of a project plan and the presentation of cash flows to justify the final decision. Introduction The business opportunity selected in this report was ‘time to party’.
12 Pages(3000 words)Essay
Strategic Decision Making
The process of new product development process can be divided into three stages: the front-end, the development, and commercialization (Postma, Broekhuizen, and Bosh, 2012: 642). The frond-end phase is recognized to be the “fuzziest”
12 Pages(3000 words)Assignment
Strategic Decision Making
Thus the new Chief Executive Officer's (CEO) decision to present himself in a prime-time TV interview is of strategic significance for a number of reasons. In the first instance Bamford's decision is based on the premise that with the death of the old CEO things are bound to change at Comfort Homes.
10 Pages(2500 words)Case Study
Decision Making Software Analysis and Discussion
The development of decision making software, therefore, can be an invaluable tool to utilize. In researching the various products available, I examined various products and chose to analysis Visual Decision and their Decision Lab product. Their software, Decision Lab 2000, "is a multi-criteria analysis and decision-making software" ("Decision lab" 2004); further the software offers the flexibility of various applications in reaching complex decisions.
2 Pages(500 words)Essay
Strategic and Financial Decision Making
Borrowings include loans from financial institutions; corporate bonds etc. while shareholders funds include equity share capital, preference share capital, accumulated profits. However, the amount of risk involved in both the sources of financing differs.
8 Pages(2000 words)Essay
Strategic and Financial Decision-making
For the assignment Sage Group (SGE) and Diageo Plc (DGE) have been selected. Sage Group is a software and computer services company in UK. Diageo Plc is a leading company in premium drinks with a collection of brands across wine, spirit
9 Pages(2250 words)Essay
Strategic and Financial Decision-making
The stocks are issued by different public sector companies and the investors buy and sell the stock keeping in mind the market situation and the forecast made. Most of the investors are influenced by
8 Pages(2000 words)Essay
Incremental analysis + decision making
when they launched the BlackBerry Passport in Toronto so as to be able to win back their home country back (Ligaya, 2014). This report focuses on the BlackBerry Ltd. move to get Canada behind them like it in the process of
2 Pages(500 words)Essay
Analysis of the Strategic Decision of Apple Inc
For this study, Apple Inc. has been chosen as the organization. The reason behind choosing Apple is the recent shift in the leadership of Steve Jobs to Tim Cook. Analyzing the strategic decision making of Apple will also help in clearly understanding the differences in strategic management approach.
8 Pages(2000 words)Essay
Financial Reporting and Analysis for Decision Making
The other bodies governing the Hong Kong Financial reporting operates as; Hong Kong Financial Reporting Standards (HKFRS), Accounting standards (HKAS) handling the related interpretations;  while the section of stock exchange works under the financial listing rules appendices 14 and 23.
12 Pages(3000 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Essay on topic Strategic Analysis and Decision Making for FREE!
logo footer
Contact us:
Contact Us Now
FREE Mobile Apps:
  • StudentShare App Store
  • StudentShare Google play
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us