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Making better decisions are very important for the businesses as the decision can lead the company towards success or failure. Decision-making process that is used by the organisation is most important for the company to maintain the growth and development of the company in the marketplace. This is challenging for the company to implement a decision-making process effectively(A Assuad, 2018).The present report focuses on explaining the different concepts of decision making and will explain how decision making is having an impact on businesses. In the first part of the report, different internal and external factors will be analysed that can affect the decision-making process of the company. In the second section of the report, the case of a company is being described, which would critically evaluate the different concepts and factors of decision making of the company.
Effective decisions are very important for the businesses as it helps them in planning all the things in an effective manner so that the chances of errors can be reduced, and the company can be managed in an effective manner. It is important for businesses to have better decision making, or it can be said that better decision making is an important function for the management of the company. For having better decision making, it is important for the businesses to focus on all the important factors which are having an impact on the decision-making process of the company. There are different internal and external factors which are having an influence on the decision-making process of the company, and both the factors are important to be considered as they are having a greater impact on the businesses.
Leadership is an important internal factor which is having an impact on the decision making within the organisation, and it is important for the leaders to focus on using appropriate leadership style which is also having an impact on the decision making. The leader of the company is responsible for taking most of the decisions in the company, and they should focus on making a better decision which can have a positive impact on all the stakeholders of the company and can lead the company towards better development and success. It is important for the leaders to make a better choice for applying a better decision-making style so that effective decisions can be taken by them. Rational decision making is an effective decision-making style in which different steps are being followed by the managers or the leaders for selecting the best option from the different alternatives. If the leaders evaluate the different alternatives in a systematic manner, then it can help them in selecting the best option and will promote better decision making, which would have a positive impact on the organisation.
While making a decision, it is important for the managers and the leaders to be unbiased because bias decisions are having a negative impact on the effectiveness of the decisions. For avoiding the chances of being biased while making the decision, the leaders should focus on ethical decision-making approach, which is an effective approach. Ethical decision making is referred to as the process of choosing an appropriate choice from different alternatives in an ethical manner and without being biased while making a decision. Along with this, the leaders might face dissonance while making the decision which can have a negative impact on the effectiveness. If the leaders are facing the issue of dissonance, then it will affect the decision-making process of the company, which is having a negative impact on the company. Some of the leaders are having the ability to beheuristic which makes them effective leaders and helps them in taking effective decisions(Yazdani, et. al. 2017). There are different situation where the leaders need to make fast decisions and if the leader hasa heuristic that it helps them in solving the issue and making better decision effectively and easily which can have a positive impact on the decision making process in the organisation.
Apart from the internal factors, there are different external factors which are having an influence on the decision making of the organisation. The organisational structure of the company is an important factor which is having an impact on the decision-making process of the company.Usually, the businesses have a hierarchical system which has differentlevels of management which makes the decision-making process more complex. In such an organisational hierarchy it is important that all the different levels of management should have better interconnectivity among themselves which can help them in taking effective decisions for the betterment of the company and leading the company towards success(Janssen, et. al. 2017).
When different individuals are involved in the decision-making process, it is important for them to work together so that a better decision can be made. It can be said that the group conformity is important for making an effective decision in the organisation. The leaders of the company need to make different decisions related to a different thing, and the external business environment is also included in some of the decisions of the company. The business market in which the company is also having an impact on the decisions of the company as the leaders need to focus on the customers and the entire market to which they are serving their products and services. It is important for the managers and the organisation to focus on the betterment on the external market while making a decision in the firm. Along with this, the economy and the government legislations are also the important factors of the external business environment which are having an impact on the decision making in the organisation(Polat, et. al. 2019). Some of the decisions include the concern of the government regulations, and due to the legal system of the government, the company needs to make decisions which are appropriate as per the legislation. It can be said that there are different factors of the external factors which need to be taken in concern by making a decision within the organisation.
Boeing being a multinational corporation is having great market presence and is serving high-quality aeroplanes to different airlines across the globe. The company is having a great market position in the international airplane manufacturing industry but had faced great reputational and financial loss due to the crash of 737-8 Max. The investigations represented that the lack of better decision-making process of the company is the major reason behind all these crashes and the management of the company is responsible for all the crashes. While developing the aircraft, the company had not shared the important information related to the changes in the design of the aircraft, and even the pilots had not received any training regarding the changes made. The leaders of Boeing much had taken a correct decision regarding the changes in the aircraft and the airlines and the pilots much had to give all the essential details regarding the changes made in the designing of the aircraft.
The company had not focused on all the important internal and external factors which would have taken in concern by them while making a decision. When the decision is being made by the company regarding making changes in the design the company had not concerned regarding the safety of the passengers and their clients as well and due to lack of concern only the company had decided not to explain all these things to their clients. For such a large organisation it is important to focus on the benefit of all the stakeholders, and as the company is operating in the customer service sector,it is important for them to make a better decision in the fever of the travellers or the customers.
Boeing had also not focused on one of the most important external factors which are having an impact on the decision making of the organisation, which is the government legislations. The company might have focused on the seriousness of the situation that if any of the issues might occur that the company had to face severe issue related to the legislation. Along with this, the major issue in the decision making of the case company is seen that all the different departments and even the manufacturing department were not a concern for the seriousness of the decision and its impact on the organisation which is very disappointing. If the company had implemented the rational decision making, then it would have helped them in taking a better decision and analysing whether the decision will affect the company positively or negatively(Pérez, et. al. 2018).
After the first crash took place in the year 2018 then also the leaders and the managers of Boeing had not responded effectively on it and due to lack of attention on the first crash the another 737 Max god crashed on 2019. There are different situation in which the company needs to be very quick and effective while making the decision. If the leaders of Boeing had taken better and effective decisions just after the first crises that it would have helped them in managing the adverse effect of the crises in an effective manner. The CEO of Boeing Dennis Muilenburg had reflected lack of decision-making skills and was not having an effective decision-making style as a result of which the company had faced such a major issue and had also not responded effectively to the issues in the aircraft which leads to two severe plane crashes which had led to the loss of human life(Gambetti, &Giusberti, 2019).
This situation which had occurred in Boeing reflected that the company hasan ineffective decision-making process within the company which had affected the company negatively. The CEO of the company himself was not having all the information regarding the human casualties of the 737 Max due to which he had not taken an effective decision. In the present case, the lack of concern for the customer is being seen which reflects that the company is not having lack of ethical decision-making behaviour in the organisation as all the leaders the head of the manufacturing department and even the CEO of the company was not concern regarding the ethics of the company. If all the leaders and the managers had focused on their roles and responsibilities and had worked in an ethical manner, then they might not have faced such issues.
From the situation mentioned in the case study of Boeing, it can be said that the company is having ineffective decision making in the company which had affected negatively to them(Johnston, & Harris, 2019). The company not have taken better decisions regarding the information which needs to be shared by the airlines and then had not also responded to the crash effectively. It can be said that the leaders should have responded effectively to the situation and must have managed the situation in an effective manner. Due to lack of better decision making the company had faced major issues,and also the leaders had not focused on analysing how the factors of the internal and external environment are linked with their decision. It can be said that things can be much different if the leaders of the company would have implemented effective leadership and decision-making style in the organisation.
The above-mentioned report had explained how important the decision makingis for the businesses and how decision making is having an impact on the company. The report had found that different factors of the internal and external business environment are having an impact on the decision-making process. Along with this, the report mentions that the leaders need to apply effective decision-making styles in the different styles which can help them in making better decisions for the company. For explaining these concepts effectively, the case of Boeing is being discussed through which it is clearly explained it is important for the businesses to have better decision making within the organisation as it is having a significant impact on the organisation. It can be concluded that it is important for businesses to focus on having an effective decision-making process within the organisation.
A Assuad, C. S. (2018, July). Tensions in Decision-Making the Context of Sustainable Development for Manufacturing Companies. In Academy of Management Proceedings (Vol. 2018, No. 1, p. 16370). Briarcliff Manor, NY 10510: Academy of Management.
Gambetti, E., &Giusberti, F. (2019). Personality, decision-making styles and investments. Journal of Behavioral and Experimental Economics, 80, 14-24.
Janssen, M., van der Voort, H., &Wahyudi, A. (2017). Factors influencing big data decision-making quality. Journal of Business Research, 70, 338-345.
Johnston, P., & Harris, R. (2019). The Boeing 737 MAX saga: lessons for software organizations. Software Quality Professional, 21(3), 4-12.
Pérez, I. J., Cabrerizo, F. J., Alonso, S., Dong, Y. C., Chiclana, F., & Herrera-Viedma, E. (2018). On dynamic consensus processes in group decision making problems. Information Sciences, 459, 20-35.
Polat, ?., Kutlu, L., Ay, F., Pur?sa, S., & Erkan, H. A. (2019). Decision?making styles, anxiety levels, and critical thinking levels of nurses. Japan Journal of Nursing Science, 16(3), 309-321.
Yazdani, M., Zarate, P., Coulibaly, A., &Zavadskas, E. K. (2017). A group decision making support system in logistics and supply chain management. Expert systems with Applications, 88, 376-392.
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