1 Introduction to Business Management

Table of Contents

1. Topic pack - introduction
2. 1.1 Nature of business activity - notes
3. 1.1 Nature of business activity - questions
4. 1.2 Types of organisation - notes
5. 1.2 Types of organisation - questions
6. 1.3 Organisational objectives - notes
7. 1.3 Organisational objectives - questions
8. 1.4 Stakeholders - notes
9. 1.4 Stakeholders - questions
10. 1.5 External environment - notes
11. 1.5 External environment - questions
12. 1.5 External environment - simulations and activities
13. 1.6 Organisational planning tools - notes
    1. Organisational planning tools
    2. Business plan
    3. Decision-making processes - introduction
    4. Decision-making processes
    5. Decision-making - fishbone diagram
    6. Decision trees
    7. Decision trees - worked example
    8. SWOT analysis
14. 1.6 Growth and evolution - notes
15. 1.7 Growth and evolution - questions
16. 1.7 Growth and evolution - simulations and activities
17. 1.6 Change (HL only) - notes
18. 1.9 Globalisation - notes
19. 1.9 Globalisation - questions
20. Print View

Decision-making processes - introduction

Managing a business successfully involves effective decision-making.
Decisions can be based on:

• Scientific data or facts.
• Experience
• Intuition or 'gut feeling'

Most decisions combine aspects of all three factors. A very experienced manager may make faster, but effective decisions based on knowledge, acquired from previous, successful business actions. Less experienced managers may feel more secure if they gather more data to support a chosen course of action.

Decision making process

The model on the left shows a typical systematic decision making process and can be referred to as the 6I model.

The decision making tools identified as important by the IB syllabus:

• fishbone diagram
• decision tree
• force field analysis
• Gantt chart
  

Are all scientific approaches to Identifying the problem, information processin and Identifying options from then on it is up to the manager to Isolate a choce of action, implement and check on improvements made. These steps could be less scientific, based on experience and intuition.

It must always be remembered that the business environment is dynamic and complex and a previously successful decision may not prove so successful at a later time. Managers must regularly review their decisions in the light of events and make new judgments if evidence suggests they should.