Question 1.Explain Decision making process and various types of decision with examples? Ans: Decision making can be regarded as the mental processes (Cognitive process) resulting in the selection of a course of action among several alternative scenarios. Every decision making process produces a final choice. The output can be an action or an opinion of choice. Developed by B. Aubrey Fisher, there are four stages that should be involved in all group decision making. These stages, or sometimes called phases, are important for the decision-making process to begin Orientation stage- This phase is where members meet for the first time and start to get to know each other. Conflict stage- Once group members become familiar with each other, disputes, little fights and arguments occur. Group members eventually work it out. Emergence stage- The group begins to clear up vague opinions by talking about them. Reinforcement stage- Members finally make a decision, while justifying themselves that it was the right decision. When in an organization and faced with a difficult decision, there are several steps one can take to ensure the best possible solutions will be decided. These steps are put into seven effective ways to go about this decision making process. An Example illustrating Decision Making Process in an Organization * The first step - Outline your goal and outcome. This will enable decision makers to see exactly what they are trying to accomplish and keep them on a specific path. * The second step - Gather data. This will help decision makers have actual evidence to help them come up with a solution. * The third step - Brainstorm to develop alternatives. Coming up with more than one solution ables you to see which one can actually work. * The fourth step - List pros and cons of each alternative. With the list of pros and cons, you can eliminate the solutions that have more cons than pros, making your decision easier. * The fifth step - Make the decision. Once you analyze each solution, you should pick the one that has many pros (or the pros that are most significant), and is a solution that everyone can agree with. * The sixth step - Immediately take action. Once the decision is picked, you should implement it right away. * The seventh step - Learn from, and reflect on the decision making. This step allows you to see what you did right and wrong when coming up, and putting the decision to use. Another example showing Decision Making Process with respect to consumer behavior.
This model is important for anyone making marketing decisions. It forces the marketer to consider the whole buying process rather than just the purchase decision (when it may be too late for a business to influence the choice!) The model implies that customers pass through all stages in every purchase. However, in more routine purchases, customers often skip or reverse some of the stages. For example, a student buying a favourite hamburger would recognise the need (hunger) and go right to the purchase decision, skipping information search and evaluation. However, the model is very useful when it comes to understanding any purchase that requires some thought and deliberation. The buying process starts with need recognition. At this stage, the buyer recognises a problem or need (e.g. I am hungry, we need a new sofa, I have a headache) or responds to a marketing stimulus (e.g. you pass Starbucks and are attracted by the aroma of coffee and chocolate muffins). An “aroused” customer then needs to decide how much information (if any) is required. If the need is strong and there is a product or service that meets the need close to hand, then a purchase decision is likely to be made there and then. If not, then the process of information search begins. A customer can obtain information from several sources:
• Personal sources: family, friends, neighbours etc
• Commercial sources: advertising; salespeople;...