The Decision Making Process
What is the meaning of decision making.
The decision making is one of the most basic cognitive procedures of human behaviors. The decision making process is a vital process in personal life as well as vital for professional purpose (Tamir et al. 2015). The decision making component is an important principle of the business analytics. There are widely used decision theories that are widely implemented in the business scenario. In a business scenario, there is a need to perform routine decision making tasks. There is a need to adopt cognitive decision making policies to achieve business success. This report describes the role of human cognition in the decision making process. The second part of the report describes the role of analytics in decision making process. It also discusses the influence of data in the process of decision making.
The process of the selection of a preferred course of action among a set of alternatives or options is known as decision making. The layered model of brain comprises of the fundamental cognitive procedures of decision making (Gläscher et al. 2012). There are specific characteristics of the decision making processes such as decision maker, decision situation, and the decision process. The core cognitive features of the human brain are known to share similar characteristics. The three important features of the decision making process include a set of alternatives or choices, decision goals and a list of selection strategies (Gläscher et al. 2012). If there is a fulfillment of these three criteria, then the decision making process can be easily carried out by a human being.
The consequences of the decision making processes can be estimated from the strategies of decision making used by the decision maker (Elwyn et al. 2012). The different strategies of decision making require a combination of decision selection criteria. It is also important to perform rational decision making for the success of business entities. There is a need to adopt different decision strategies as per the values of the decision makers, attitudes towards risk and the prediction of future outcomes.
The intellectual capabilities of the human beings have made it possible for themselves to gain a superior status among all animal species (Seligman and Csikszentmihalyi 2014). The presence of intellectual capabilities has allowed the human beings to adapt to a specific environment, and there have been evolving patterns of decision making capabilities. There has been a transformation in the intellectual capabilities of human beings. The intellectual capabilities of human beings have transformed into sophisticated and more specialized skills (Seligman and Csikszentmihalyi 2014). The specialized skills include planning, observation, problem solving and coordination. The decision making process works in close collaboration with the problem solving process (Seligman and Csikszentmihalyi 2014). The decision making process consists of the analysis, synthesis and the evaluation of the job tasks. The analysis of the job tasks is the first step of the decision making process.
The cognitive process of the decision making begins with the detailed analysis of the decision making problem (Croskerry 2013). The objective of the decision making process should be identified, and an initial framework needs to be created. The alternatives should be assessed for the purpose of the formulation of strategies. The alternatives are thoroughly evaluated and the human intellectual capabilities give an idea regarding the best alternative (Croskerry 2013). The best alternatives out of the given choices are selected. The selected best alternative should be evaluated well and checked if it meets the predetermined goals or standards (Croskerry 2013). The decision maker would make sure that the decision meets the current scenario and the personal judgment. If there is a mismatch between the expected outcome and the current outcome, then the decision making process needs to be repeated (Croskerry 2013). The decision making process should be done until a satisfied decision arrives.
Cognitive Process in Decision Making
The phenomenon of human decision making is influenced by rational behavior and does not always follow a fixed course (Seligman and Csikszentmihalyi 2014). There are individual differences in the cognitive process, which aids in the decision making process. The role of analytics is immense in the decision making process. The business analytics consists of the study of various patterns of data through operations and statistical analysis and the application of these to customers and the business (Croskerry 2013). The business analytics deals with the technologies, skills and practices for the continuous investigation of the past performances of business so that insights to the business can be gained. The business insights help in the business planning, which in turn helps in the decision making process.
Role of Business analytics in business
The business analytics play an important role in the business scenario (Holsapple Lee-Post and Pakath 2014). The cognitive analytics is a powerful tool to bridge any gaps between the data structure and the reality of decision making, which is an everyday function of the managers. The data and information is a vital part of the decision making process. The cognitive analytics is an additional part of cognitive computing (Holsapple Lee-Post and Pakath 2014). The cognitive computing comprises of machine learning, language processing, and the related infrastructure. There is a need to massive data processing and the ability to analyze various sources of data. The analysis of data can be essential for gaining business insights and various crucial parameters about the organization. The cognitive analysis depends on the information technology tools to generate the required hypothesis (Holsapple Lee-Post and Pakath 2014). The hypothesis is drawn after the consultation with connecting information sources, which are relevant.
The analytical decisions are driven by the organizational data (Power Sharda and Burstein 2015). The use of direct observations, figures, charts, facts are the basis for successful decision making. The decisions cannot be taken on whims and fancies. It should be directly related to the statistical figures and the current situation of the business. The decision makers use surveys, questionnaires and other means for the purpose of data collection (Power Sharda and Burstein 2015). The collected data is tabulated and put into appropriate software, which is suitable for the specific types of data. The tabulated data is then analyzed thoroughly. The decision maker should consider all the pre-determined parameters, before beginning the process of data analysis. The probability theory is an important component in the decision making process (Berger 2013). The managers need to take decisions, which are related to uncertainty. The decisions need to be made on appropriate assumptions. This theory helps the manager to deal with investment issues, introduction of a new product, stock decisions, individual investor and others.
The descriptive and inferential techniques of analytics are important for business (Devore 2015). The descriptive techniques involve the description and summarizing the collected data in a meaningful manner. This technique helps the decision maker to understand the explicit details of the data in a clear manner. The purpose of the descriptive techniques is to present the decision maker with a visual picture of the implications of the data. In the absence of the descriptive techniques, the decision maker would face difficulty in the analysis of the raw, unstructured data. The inferential techniques make use of a limited segment of the data and not the entire data (Kern 2014). The purpose of the inferential techniques allows the decision maker to make generalizations regarding the sample population. The sample should represent the population accurately. The inferential techniques deal with the estimation of parameters and the testing of relevant hypothesis.
The decision making is a vital part of the human beings. It applies to both the personal as well as professional life. The decision making is not an independent function; rather it is interconnected to other variables like data, information, analytics and others. The efficient decision making would ensure individual success as well as organizational success.
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