CFE

1. STAGES OF A
STRUCTURED
DECISION
MAKING MODEL
Higher Bus Man - Decision Making

2. POGADSCIE
 Identify Problem - What problem needs
resolved?
 Identify Objectives – What’s the intended
outcome?
 Gather information – Research
 Analyse information – Make sense of the
information in the context of the problem
 Devise alternative solutions – Figure out all
the options available

3. POGADSCIE (cont.)
 Select solution – Select the option which is
financially and logically the best
 Communicate solution – Inform all the
stakeholders who are affected
 Implement solution – Take action on the
soultion
 Evaluate – Assess whether the decision had
the intended impact

4. Task 1
 Analyse the Phones4U Situation from the
perspective of the business owner.
 Working in groups of 2/3 create a decision
making model to replicate the timeline of the
crisis, detailing how the owner came to the
decision of closure.

5. Task 2
 Your business sells stationery and has one
shop on North Berwick High Street
 Working in groups of 2/3 create a decision
making model to solve the following
problems:
 Electricity costs are increasing
 Staff often leave after only a few months
 Customers frequently return faulty goods

6. BENEFITS OF
USING A DECISION
MAKING MODEL

7. Benefits
 Time is taken to go through the structured
model and therefore no rash decisions are
made
 All necessary information is gathered before a
decision is made therefore decisions are
based on relevant and reliable information.
 Alternative solutions are looked at before a
decision is made meaning the first solution is
not accepted as the best and implemented.

8. Benefits
 The decision making process provides for the
decision to be communicated to all relevant
stakeholders which means they should know the
decisions of the organisation and not be
unaware of them
 The decision making process requires that the
decision is monitored and evaluated which
allows for corrective action and an analysis of
how effective the decision was

9. COSTS OF USING A
DECISION
MAKING
MODEL

10. Costs
 Unsuitable for quick decisions - DM models
can require time which may not be available
for some quick decisions.
 Costly to Use – A business may not have the
money required to collect all of the information
that is required for use in a decision making
model.

11. Costs
Information overload - Too much information
becomes too difficult to process and use
effectively.

12. CONSTRAINT
S
AFFECTING THE
QUALITY OF
DECISIONS

13. Internal
 Shortage of resources (ICT, time, money)
 Existing policies which prevent certain
choices (budget limitations)
 The quality of internal information
available
 Decision maker not being willing to take
risks
 The ability and skill of the manager –
lacks proper training
 Decision maker pursuing own interest

14. External
The quality of external information
available
Competitor’s actions
Government and European Union
laws
Economic environment e.g. high
unemployment, low exchange rate
Changes in social expectations (e.g.
increasing concerns over animal
testing)