Professional Documents
Culture Documents
Information is Power
Business Research Why?
• The key to business success is making the
correct decisions
• Correct decisions are becoming more
difficult to make
• The costs of making the wrong decision
are increasing
• Decision makers use all methods to
reduce risk.
But why do you need to make
decisions?
• “If you do nothing you will die”
• Decisions are a reaction to a changed
scenario
• Business aims to achieve objectives which
require decisions to be taken to give
direction to the business
• A business cannot function without
decisions being taken!
So what are decisions trying to do?
• Business Decision Making seeks to achieve two
outcomes:
Attain objectives efficiently
and
• IMPACT
• PREDICTABILITY
Impact
• Impact is the perceptually weighted
aggregate of four dimensions:
• Magnitude
• Direction
• Speed
• Ubiquity
Predictability
• Predictability is a collective perceptual
measure of how accurate managers can
be in determining the likelihood that an
event or series of events will or will not
occur.
• It ranges from total predictability (seasons,
ageing, time and mortality) to total
unpredictability (natural disasters, artistic
success, conflicts)
Why is Predictability important?
Predictability is the degree to which one can
accurately forecast the future.
Probability is the likelihood of an event occurring
in the future.
“I know that over the next year 1 in 100,000
airline flights will end in disaster, but I
cannot predict which one it will be”
Predictability=Planning=Manipulation=Control
Impact. Predictability and Strategy
Predictability
High Low
Proactive Emergency
contingency Planning
High
planning (Major
(Hurricane Incidents)
Katrina)
Impact
Policy Reactivity
Development (when event
Low
R = f (N,C,I)
Where:
N = Need to take a decision
C = Level and type of commitment
I = Indeterminacy (Uncertainty)