Decision-making occurs as a reaction to a problem. Problem is defined as a discrepancy between some current state of affairs and some desired state, needing attention for alternative courses of action. The awareness that a problem exists and that a decision needs to be made is related to perception. Every decision requires interpretation and evaluation of information. The perceptions of the decision maker will address these two issues.
Ø Data are typically received from multiple sources.
Ø Which data are relevant to the decision and which are not
Alternatives will be developed, and the strengths and weaknesses of each will need to be evaluated. For example, senior managers determine their organization's goals, what products or services to offer, how best to finance operations, or where to locate a new manufacturing plant. Middle- and lower-level managers determine production schedules, select new employees, and decide how pay raises are to be allocated. Non-managerial employees also make decisions, including, whether or not to come to work on any given day, how much effort to put forward once at work, and whether or not to comply with a request made by the boss.