Techniques of Decision-Making

The process of decision making is defined by two techniques: Traditional Method and Scientific Method.

Traditional Method

This method of decision making is also known as the method of symptomatic diagnosis. As in ancient times, the physicians used to treat patients on the basis of symptoms. In the same manner, the marketing managers take decisions on the basis of their experiences, knowledge and intuition. Thus, in this method no scientific analysis involves.

Scientific Method

In the present scenario, as an expert doctor not only relies on the external symptoms but also makes an accurate use of X-ray, ECG, etc. In the same manner, marketing management uses scientific methods for determining the objectives of the organization.

Process of taking Scientific Decisions

Identify the problem

The decision-making process begins with the recognition of a problem that requires a decision. The problem arises due to disparity between present and desired state of affairs. At this stage, a marketing manager should identify and define the real problem. A problem well-defined is half solved. Therefore, in order to identify the exact nature of the problem, he has to use imagination, experience and judgment.

Analyze the problem

After recognizing the problem, the next phase of decision-making process is to analyze the problem. It requires to find out who should take the decision, who others would be taken into confidence, what information would be needed, from where the required information is available, etc.  The problem may be analyzed in terms of the following:

  • Nature of the decision: routine or strategic.
  • Impact of decision.
  • Utility of the decision.
  • Periodicity of the decision and
  • Limited or strategic factors relevant to the decision.


Diagnose the problem


The most important part of diagnosing the problem is to find out the real cause or source of the problem. In business, symptomatic diagnosis may not lead to real problem. The situation factors are very important in diagnosing the real problem. Thus, diagnosis defines both a specific problem and the situation in which the problem exists.

Discover alternatives

After defining the problem, the next step is to search for the various possible alternatives for the solution of problem. For example, if there is problem in increasing the sales, then there are many possible alternatives to attract the customers and increase the sales such as reduce the selling price of product, improve the quality of product, change the design or packing of product,  advertise and publicize the product, provide better after -sale-services,  discontinue the product, etc. Thus, it is essential to consider all possible alternative courses of action.

Evaluate alternatives

After the various alternatives are discovered, the next stage is to evaluate each alternative.  Evaluation is the process of measuring the positive and negative consequences of each alternative. Marketing Management must set some criteria against which the alternatives can be evaluated. Peter. F. Drucker has laid down the following criteria to weigh the alternative decisions:

  • Risk is an essential part of the business activities and every decision involves some or the other risk. The only think, the marketing executive (or decision maker) can do is to take the measures to minimize the risk.
  • Economy of efforts: Cost, time and efforts are involved in each alternative. Thus, the decision maker must try to choose the alternative in which the business enterprise can get the maximum output by putting minimum efforts.
  • Timing: Whether the problem is urgent or not is depend on the present situation of an enterprise. Hence, the decision maker must take the right decision at the right time. A decision taken at a wrong time is useless even if it was the best. Therefore, the time important as an element must be considered.
  • Limitations of resources: While making a decision, the availability of resources to implement the decision must be duly considered. If decision maker take a decision which cannot be implemented because of the lack of resources. It will be useless. Therefore, the limitation of resources must be considered and the decision must be taken keeping in view the available resources.
Select the best alternative

After evaluation, the decision maker selects the best alternative that contributes maximum to the given objectives of an enterprise. The ability to select the best option from several possible options separates the successful managers from the unsuccessful ones. Thus, past experience, experimentation and research analysis is useful in selecting the best alternative.

Implementation of decision

After the best alternative is selected, it needs to be implemented. Implementation involves several steps. First, the decision should be communicated to those who are responsible for its implementation. Secondly, the acceptance of the decision should be obtained. Thirdly, procedures and time sequence should be established for implementation of task. Thus, implementation of decision is very important.

Follow-up the decisions

The implementation of the decision should be constantly monitored.  Decision-making by scientific method has no guarantee that it is cent-percent correct. It might be defective or it may cause loss to the organization. Thus, its progress should be watched carefully to minimize the chances of loss. In case the feedback indicates that the decision is not yielding the desired results, necessary should be made in the decision or n its implementation. Hence, follow-up action is a must for a scientific decision.


Thus, business management is based on decisions. An expert marketing manager has to take decisions after careful analysis of the problem or situation. His central job is to decide what to do or what not to do.

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