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BUSTRAT Assignment 4

The document discusses the 5 steps in the decision model for strategic management: 1) Obtain information through qualitative and quantitative data, 2) Predict future costs of alternatives, 3) Choose an alternative, 4) Implement the decision, and 5) Evaluate performance. The two types of information necessary for decision making are qualitative and quantitative data. Qualitative data includes non-numerical information from sources like SWOT and PESTLE analyses, while quantitative data comprises numerical information and statistics.

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Meilin Medrana
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68 views

BUSTRAT Assignment 4

The document discusses the 5 steps in the decision model for strategic management: 1) Obtain information through qualitative and quantitative data, 2) Predict future costs of alternatives, 3) Choose an alternative, 4) Implement the decision, and 5) Evaluate performance. The two types of information necessary for decision making are qualitative and quantitative data. Qualitative data includes non-numerical information from sources like SWOT and PESTLE analyses, while quantitative data comprises numerical information and statistics.

Uploaded by

Meilin Medrana
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© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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BUSTRAT Assignment 4.

AIS3B
1. Discuss the 5 steps in the decision model.
In every successful business, one needs to acquire a management that can well determine and
analyze the actions and needs of its internal and external environment in order to create and
sustain a competitive advantage. This is why almost all organizations use strategic
management to reach the desired goals and objectives so that they can formulate strategic
decision-making that can determine its performance in the future business operations. But
before they make a decision, they use the decision model. According to Halle, B. and Goldberg,
L. “The Decision Model: A Business Logic Framework Linking Business and Technology” in
2011, a decision model is an intellectual tool for perceiving, organizing, and managing business
logic in a decision. This is also a tool used to make choices through the use of qualitative and
quantitative information. These decisions come with five (5) steps so that managers have a
clearer depiction on what to do next. The first step is to obtain information. Managers need to
identify data that can be used as a competitive advantage for further improvement. These
information include qualitative information that are generally non-numerical data and
quantitative information that comprises of numerical data. The second step is to make
predictions about future costs. Since an organization has now obtained the information
needed, they must forecast incremental costs and alternatives for every possible course action
they make. Future costs are essential because these affect the making of specific management
decisions. This brings us to the third step which is to choose an alternative. This is considered
an important step because this will determine how the final decision will have an impact to your
organization. Furthermore, this can help in reviewing the different options and future
consequences if a manager chooses these alternatives. The fourth step is to implement the
decision. Since an organization has chosen its final decision, they will go on to the fifth and last
step which is to evaluate performance. This part of the model is where the business identifies
risks and develop skills for future problems. After a project is done, this is the part where they
gather feedback to recognize any problems to try to make further improvements.
2. What are the two types of information that are necessary for decision making?
Discuss each.
Going back to the decision model, the first step that needs to be considered is to obtain
information. An organization needs to gather data from its external and internal environment
which will be used in strategic decision-making and determining what factors are affecting its
business. With this, the two types of information that are essential are the qualitative factors
that is obtained through the researcher, usually in non-numerical data and quantitative factors
that usually contains numerical data and may be hard to measure. For gathering qualitative
factors, these include information that cannot be measured. In most businesses, they use
business tools such as the SWOT Analysis and PESTEL Analysis to determine the factors and
aspects that are essential in the business. In addition, qualitative factors also include the human
resource management which aims to identify issues such as morale, employee relationships,
motivation, etc. Another qualitative factor is stakeholder analysis which aims to study the needs
and driving factors of each internal and external users of the organization. This can all be
through the use of observation, surveys, and interviews. On the other hand, quantitative factors
include mostly of numerical data and statistical analysis. These numerical data are more
complexed but can also determine information that will be useful in the future operations.
References:
 Halle, B. and Goldberg, L. “The Decision Model: A Business Logic Framework Linking
Business and Technology” (2020). Ittoday.Info.
http://www.ittoday.info/ITPerformanceImprovement/Articles/2011-03VonHalleGoldberg.html
 5 Steps to Good Decision Making. (2019). Corporatewellnessmagazine.com.
https://www.corporatewellnessmagazine.com/article/5-steps-to-good-decision-making
 Qualitative & Quantitative Decision Making. (n.d.). Www.Linkedin.com. Retrieved November
10, 2020, from https://www.linkedin.com/pulse/20140920165433-34529931-qualitative-
quantitative-decision-making#:~:text=Quantitative%20decisions%20are%20mostly
%20based

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