INTRODUCTIONThe purpose of this paper is to analyze the decision -making process that was involved in appointment of company president, in the company where I personally worked.
Mr. Zutshi, the company president faced a very critical Decision Making Essay situation while appointing new successor for the company, after his retirement. A Chief executive officer’s decision has considerable impact on the performance of the organization. Decision-making is one of the most important recurring responsibilities facing managers in organizations. A high-quality decision helps an organization accomplish its strategic goals and also meets the needs of the organization’s employees, executives, stockholders, consumers, or suppliers.Order now
In his book called Decision Making, Paul Moody (1983) defines decision as an action that must be taken when there is no more time for gathering facts. The Problem is how to decide when to stop gathering facts. The solution varies with each problem we attempt to solve, for gathering facts costs time and money. RELEVANT RESEACHPeter E. Druker (1967), lists five elements of decision process in his book, The effective Executive:1) Clear realization that the problem is generic and can be solved only through a decision that establishes a rule, 2) Definition of the specifications of the solution, or the boundary conditions, 3) Derivation of a solution that is right, that is, one that fully satisfies the specifications before attention is given to the concessions needed to make the decision acceptable, 4) The building into the decision of the action to carry it out, 5) The feedback that tests the validity and effectiveness of the decision against the actual course of events. Druker goes on to explain that a decision is a judgment and, as such, is rarely a choice between right and wrong.
At best it is a choice between almost right and almost wrong. Paul Moody (1983), has written in his book, Decision Making, that, if a company has a long-standing policy of acting in a certain situation in a particular way, then it is easy to make a decision that is consistent with past history. However, if an organization is very volatile and a historical pattern has not been established –or if the nature of the decision is such that actions are highly dependent on the factors known to only higher-level personnel in the organization–then the decision assumes major importance. He further adds that, where the human impact of a decision is great, its importance is great.
This is particularly true when the decision involves many people. Paul C. Nutt (1989), states in his book, Making Tough Decisions, that, the best that a decision maker can do is follow steps thats increase the prospects of understanding foreseeable risks and prepare for possible outcomes. Most decisions have uncertainty, ambiguity, and conflict.
Uncertainty and ambiguity arises when key elements in a decision cannot be characterized. Conflict can stem from ambiguity, or it can result from the disagreements among key parties with stakes in the decision (Freeman, 1983). In the book called Decision making at the Top, Gordon Donaldson & Jay W. Lorsch (1983) state that, strategic decisions are not the product of simple economic logic alone.
Because these decisions often depend on forecasts of the future events, they involve considerable uncertainty and ambiguity. Corporate leaders’ desire to assure the survival of their company provides the driving force for their initiatives and strategic choices. James G. March (1994) has written in his book, A Primer on Decision making, that, Organizational decision making is a combination of talk and action.
The making of concrete decisions in an organization is an exercise of practical, contextual judgment. Decision making normally presumes commitment, the willingness of decision-makers both to devote time and energy to deciding and to accept responsibility for the uncertain consequences of their actions. ANALYSIS:Case: At 60, Mr. H L Zutshi, the company president, decided he would retire before the mandatory retirement age of 65.
He did not reveal his decision to anyone until he reached 62, and at this time he confided to his best friend and the most powerful board member that he would retire imminently. Mr. Zutshi proposed that Mr. S K Kherr, Vice President, Administration, a very able and experienced executive, succeed him as president. Mr.
Zutshi’s friend vehemently opposed Kherr’s candidacy, and forcefully .