Question

Tangible and intangible factors element with decision making

Answer 1

Steps in Decision Making Process

One of the core functions of any manager, at any level and in any firm is decision making. Every function of the manager (planning, directing, controlling etc) involves taking decisions. So it is important that the process is done in an efficient and stepwise manner.

In general, there are certain defined steps in decision making. They provide a framework for the manager so that the whole process is more efficient. These steps in decision making help the manager make informed decisions that help the organization achieve its goals. Let us take a look.

Steps in Decision Making

Identify the Problem

The first step is defining the problem, or in some cases identifying the opportunity. The symptoms of the problem must not be confused with the real problem. So this step requires careful attention, investigation and time.

After successful identification, we can move onto diagnosis. This involves understanding the problem, and seeing how it affects the long term and short term objectives of the firm.

Identifying Alternatives

Once you have an in-depth understanding of the problem or the opportunity, it is now time to identify some alternative courses of actions and their possible consequences.

The problem is that there are generally too many options and alternatives. The management cannot waste resources and money. So it must only consider strategic factors when identifying probable alternatives.

Analyzing the Alternatives

Now the next logical step will be analyzing all the possible alternatives for their pros and cons. There are tangible and intangible factors to consider when weighing the choices.

Tangible factors include profit, the rate of return, time value etc. And then there are intangible factors like reputation, employee morale, PR etc.

After evaluating the feasibility and acceptability of all alternatives, the manager must make his choice. A valued second opinion is always welcome as it gives a fresh perspective.

Answer 2

Answer:

As per Marry Nites:

"Decision-Making takes place in adopting the objectives and choosing the means and again when a change in the situation creates a necessary for adjustments."

Explanation:

The following are two factors element in decision making.

1. Tangible Factors

• Any decision's impact on one or more of the quantifiable elements may be measured, making it simple to weigh the benefits and drawbacks of each option.
• Decisions based on these elements are more likely to be unbiased and devoid of the decision maker's bias.
• These Include -Sales, Cost, Purchase, Production, Inventory, Financial, Personnel, Logistics

1. Intangible Factors

• It can be difficult to find accurate data and information on these topics.
• Therefore, the decision-intuition maker's and value judgement will play a crucial influence in the selection of a certain alternative.
• These include - Prestige of the enterprise, Consumer behaviour, Employee morale, Availability of alternatives, Experience of decision maker, Knowledge base

Hence, we can conclude that to get accurate and unbiased opinion for decision making, rely more on tangible factors.

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