Decision making is integral to management practices. The decision-maker will have to consider various factors before arriving at his/her decision. Recently, I made an important decision in personal life, namely, to buy a house. I used the management principles I learned in the course as a guideline trough my decision making process. I would like to believe that I have made the correct choice. But when it comes to evaluating how good my choice was, I need to make a time-wise longitudinal study. In this sense, only ‘time will tell’ how good the decision was.
One of the features of managerial decision making is the lack of any systematic approach to it. In other words, decision making is usually an unstructured process, which is built on broad rules of thumb like weighing pros and cons, exploring risk potential, understanding historical precedents of similar scenarios, etc. Hence, in my own project to buy a house I had to adopt a free flowing, open-ended approach that included ad hoc elements. I first listed out all the major criteria that the house will have to satisfy. These included things like ‘safe neighborhood’, ‘proximity to quality hospitals and schools’, ‘noise and air pollution levels’, ‘greenery and landscape of the locality’, etc. Other important criteria for me were: ‘suburban residential’, ‘easy and quick connectivity to inner-city’, ‘quick access to a public library’, ‘a distance of not more than 10 miles from office/college’, etc. After having drawn a comprehensive list of the major criteria, I then went ahead to shortlist residential areas in the city’s outskirts which satisfied all the criteria.
Next I made appointments with sellers and brokers to go and visit the houses. Although more than one house satisfied my basic conditions, ultimately, it is intangible factors like the ‘atmosphere’, ‘feel’ and ‘ambience’ that tipped their candidature. All other factors being equal or similar, even details like the view through the windows made certain houses preferable over others. But this was not the end of the decision making process, for however perfect a house was, I was never going to overpay to buy it. In other words, the final and most important criteria are the pricing of the house, which I wanted to be fair and reasonable.
There is one other external factor which I had to consider. This is the cyclical boom and bust of housing markets. Fortunately for me I was making my purchase in a period of downturn – not just for the housing market but for the entire economy. This proved to be advantageous in getting the pricing right. Though I bought the house with the intention of living in it for several years, I was not entirely ignoring its prospects for resell. When the housing markets do eventually start flourishing and the price of houses correspondingly pick up, I wanted to have the option of selling the house for a sizeable profit. Toward this end, I made sure that the type of house and its locality is sought after by the upwardly mobile section of the demography. This would mean that my potential buyers would not be very particular about the price as long as their other criteria are fulfilled. In this way I finally decided and bought the house.
The method I followed to arrive at my decision embraced some of the management principles studied in the course. But the nature of this personal project is such that certain intangible factors were taken into account as well. The numerous case studies studied in the course helped me fine tune my executive qualities. This in turn played a role in helping my decision making.
- Champion and J. James, Critical Incidents in Management: Decision and Policy Issues, 6th ed. (Burr Ridge, IL: Richard D. Irwin, 1989). The McGraw-Hill Companies.