Decision making can be defined as making a choice among alternative courses of action or as the process of choosing one alternative from among a set of rational alternatives. This definition has three different but interrelated implications. See Fig.8.1.
Effective decision-making requires a clear understanding of the situation. Most people think that an effective decision is one that optimism some factor such as profits, sales employee welfare, or market share. In some situations, however, the effective decision may be one that minimises loss, expenses, or employee turnover. It may even mean selecting the best method for going out of business or terminating a contract.
