DECISION MAKING AND SOME ASPECTS OF DECISION
Many a time we speak of the word decision, as if we know much about decision. But what is decision?
What it consists of? What are its characteristics? Let us have brief discussion about the word decision,
as much of our time we deal with decision-making process in Operations Research. A decision is the
conclusion of a process designed to weigh the relative uses or utilities of a set of alternatives on hand,
so that decision maker selects the best alternative which is best to his problem or situation and
implement it. Decision Making involves all activities and thinking that are necessary to identify the most
optimal or preferred choice among the available alternatives. The basic requirements of decision-
making are (i) A set of goals or objectives, (ii) Methods of evaluating alternatives in an objective manner,
(iii) A system of choice criteria and a method of projecting the repercussions of alternative choices of
courses of action. The evaluation of consequences of each course of action is important due to
sequential nature of decisions. The necessity of making decisions arises because of our existence in the
world with various needs and ambitions and goals, whose resources are limited and sometimes scarce.
Every one of us competes to use these resources to fulfill our goals. Our needs can be biological,
physical, financial, social, ego or higher-level self-actualisation needs. One peculiar characteristics of
decision-making is the inherent conflict that desists among various goals relevant to any decision
situation (for example, a student thinking of study and get first division and at the same time have youth
hood enjoyment without attending classes, OR a man wants to have lot of leisure in his life at the same
time earn more etc.). The process of decision-making consists of two phases. The first phase consists of
formulation of goals and objectives, enumeration of environmental constraints, identification and
evaluation of alternatives. The second stage deals with selection of optimal course of action for a given
set of constraints. In Operations Research, we are concerned with how to choose optimal strategy under
specified set of assumptions, including all available strategies and their associated payoffs. Decisions
may be classified in different ways, depending upon the criterion or the purpose of classification. Some
of them are shown below:
Decisions may also be classified depending on the situations such as degree of certainty. For example,
(i) Decision making under certainty (ii) Decision making under Uncertainty and (iii) Decision making
under risk. The first two are two extremes and the third one is falls between these two with certain
probability distribution.
OBJECTIVE OF OPERATIONS RESEARCH
Today’s situation in which a manager has to work is very complicated due to complexity in business
organizations. Today’s business unit have number of departments and each department work for fulfilling
the objectives of the organization. While doing so the individual objective of one of the department may
be conflicting with the objective of the other department, though both working for achieving the common
goal in the interest of the organization. In such situations, it will become a very complicated issue for the
general manager to get harmony among the departments and to allocate the available resources of all
sorts to the departments to achieve the goal of the organization. At the same time the environment in
which the organization is operating is very dynamic in nature and the manager has to take decisions
without delay to stand competitive in the market. At the same time a wrong decision or an untimely
decision may be very costly. Hence the decision making process has become very complicated at the same
time very important in the environment of conflicting interests and competitive strategies. Hence it is
, desirable for modern manager to use scientific methods with mathematical base while making decisions
instead of depending on guesswork and thumb rule methods. Hence the knowledge of Operations
Research is an essential tool for a manager who is involved in decision making process. He must have
support of knowledge of mathematics, statistics, economics etc., so that the decision he takes will be an
optimal decision for his organisaton. Operation Research provides him this knowledge and helps him to
take quick, timely, decisions, which are optimal for the organisaton. Hence the objective of operations
research is: “The objective of Operations Research is to provide a scientific basis to the decision maker for
solving the problems involving the interaction of various components of an organization by employing a
team of scientists from various disciplines, all working together for finding a solution which is in the best
interest of the organisaton as a whole. The best solution thus obtained is known as optimal decision”.
DEFINITION OF OPERATIONS RESEARCH
Any subject matter when defined to explain what exactly it is, we may find one definition. Always a
definition explains what that particular subject matter is. Say for example, if a question is asked what is
Boyel's law, we have a single definition to explain the same, irrespective of the language in which it is
defined. But if you ask, what Operations research is? The answer depends on individual objective. Say
for example a student may say that the Operations research is technique used to obtain first class marks
in the examination. If you ask a businessman the same question, he may say that it is the technique used
for getting higher profits. Another businessman may say it is the technique used to capture higher market
share and so on. Like this each individual may define in his own way depending on his objective. Each and
every definition may explain one or another characteristic of Operations Research but none of them
explain or give a complete picture of Operations research. But in the academic interest some of the
important definitions are discussed below.
(a) Operations Research is the art of winning wars without actually fighting. - Aurther Clarke. This
definition does not throw any light on the subject matter, but it is oriented towards warfare. It means to
say that the directions for fighting are planned and guidance is given from remote area, according to which
the war is fought and won. Perhaps you might have read in Mahabharatha or you might have seen some
old pictures, where two armies are fighting, for whom the guidance is given by the chief minister and the
king with a chessboard in front of them. Accordingly war is fought in the warfront. Actually the chessboard
is a model of war field.
(b) Operations Research is the art of giving bad answers to problems where otherwise worse answers
are given. - T.L. Satty. This definition covers one aspect of decision-making, i.e., choosing the best
alternative among the list of available alternatives. It says that if the decisions are made on guesswork,
we may face the worse situation. But if the decisions are made on scientific basis, it will help us to make
better decisions. Hence this definition deals with one aspect of decision-making and not clearly tells what
operations research is.
(c) Operations Research is Research into Operations. - J. Steinhardt. This definition does not give
anything in clear about the subject of Operations Research and simply says that it is research in to
operations. Operations may here be referred as military activities or simply the operations that an
executive performs in his organisations while taking decisions. Research in the word means that finding a
new approach. That is when an executive is involved in performing his operations for taking decisions he
has to go for newer ways so that he can make a better decision for the benefit of his organisation.
Many a time we speak of the word decision, as if we know much about decision. But what is decision?
What it consists of? What are its characteristics? Let us have brief discussion about the word decision,
as much of our time we deal with decision-making process in Operations Research. A decision is the
conclusion of a process designed to weigh the relative uses or utilities of a set of alternatives on hand,
so that decision maker selects the best alternative which is best to his problem or situation and
implement it. Decision Making involves all activities and thinking that are necessary to identify the most
optimal or preferred choice among the available alternatives. The basic requirements of decision-
making are (i) A set of goals or objectives, (ii) Methods of evaluating alternatives in an objective manner,
(iii) A system of choice criteria and a method of projecting the repercussions of alternative choices of
courses of action. The evaluation of consequences of each course of action is important due to
sequential nature of decisions. The necessity of making decisions arises because of our existence in the
world with various needs and ambitions and goals, whose resources are limited and sometimes scarce.
Every one of us competes to use these resources to fulfill our goals. Our needs can be biological,
physical, financial, social, ego or higher-level self-actualisation needs. One peculiar characteristics of
decision-making is the inherent conflict that desists among various goals relevant to any decision
situation (for example, a student thinking of study and get first division and at the same time have youth
hood enjoyment without attending classes, OR a man wants to have lot of leisure in his life at the same
time earn more etc.). The process of decision-making consists of two phases. The first phase consists of
formulation of goals and objectives, enumeration of environmental constraints, identification and
evaluation of alternatives. The second stage deals with selection of optimal course of action for a given
set of constraints. In Operations Research, we are concerned with how to choose optimal strategy under
specified set of assumptions, including all available strategies and their associated payoffs. Decisions
may be classified in different ways, depending upon the criterion or the purpose of classification. Some
of them are shown below:
Decisions may also be classified depending on the situations such as degree of certainty. For example,
(i) Decision making under certainty (ii) Decision making under Uncertainty and (iii) Decision making
under risk. The first two are two extremes and the third one is falls between these two with certain
probability distribution.
OBJECTIVE OF OPERATIONS RESEARCH
Today’s situation in which a manager has to work is very complicated due to complexity in business
organizations. Today’s business unit have number of departments and each department work for fulfilling
the objectives of the organization. While doing so the individual objective of one of the department may
be conflicting with the objective of the other department, though both working for achieving the common
goal in the interest of the organization. In such situations, it will become a very complicated issue for the
general manager to get harmony among the departments and to allocate the available resources of all
sorts to the departments to achieve the goal of the organization. At the same time the environment in
which the organization is operating is very dynamic in nature and the manager has to take decisions
without delay to stand competitive in the market. At the same time a wrong decision or an untimely
decision may be very costly. Hence the decision making process has become very complicated at the same
time very important in the environment of conflicting interests and competitive strategies. Hence it is
, desirable for modern manager to use scientific methods with mathematical base while making decisions
instead of depending on guesswork and thumb rule methods. Hence the knowledge of Operations
Research is an essential tool for a manager who is involved in decision making process. He must have
support of knowledge of mathematics, statistics, economics etc., so that the decision he takes will be an
optimal decision for his organisaton. Operation Research provides him this knowledge and helps him to
take quick, timely, decisions, which are optimal for the organisaton. Hence the objective of operations
research is: “The objective of Operations Research is to provide a scientific basis to the decision maker for
solving the problems involving the interaction of various components of an organization by employing a
team of scientists from various disciplines, all working together for finding a solution which is in the best
interest of the organisaton as a whole. The best solution thus obtained is known as optimal decision”.
DEFINITION OF OPERATIONS RESEARCH
Any subject matter when defined to explain what exactly it is, we may find one definition. Always a
definition explains what that particular subject matter is. Say for example, if a question is asked what is
Boyel's law, we have a single definition to explain the same, irrespective of the language in which it is
defined. But if you ask, what Operations research is? The answer depends on individual objective. Say
for example a student may say that the Operations research is technique used to obtain first class marks
in the examination. If you ask a businessman the same question, he may say that it is the technique used
for getting higher profits. Another businessman may say it is the technique used to capture higher market
share and so on. Like this each individual may define in his own way depending on his objective. Each and
every definition may explain one or another characteristic of Operations Research but none of them
explain or give a complete picture of Operations research. But in the academic interest some of the
important definitions are discussed below.
(a) Operations Research is the art of winning wars without actually fighting. - Aurther Clarke. This
definition does not throw any light on the subject matter, but it is oriented towards warfare. It means to
say that the directions for fighting are planned and guidance is given from remote area, according to which
the war is fought and won. Perhaps you might have read in Mahabharatha or you might have seen some
old pictures, where two armies are fighting, for whom the guidance is given by the chief minister and the
king with a chessboard in front of them. Accordingly war is fought in the warfront. Actually the chessboard
is a model of war field.
(b) Operations Research is the art of giving bad answers to problems where otherwise worse answers
are given. - T.L. Satty. This definition covers one aspect of decision-making, i.e., choosing the best
alternative among the list of available alternatives. It says that if the decisions are made on guesswork,
we may face the worse situation. But if the decisions are made on scientific basis, it will help us to make
better decisions. Hence this definition deals with one aspect of decision-making and not clearly tells what
operations research is.
(c) Operations Research is Research into Operations. - J. Steinhardt. This definition does not give
anything in clear about the subject of Operations Research and simply says that it is research in to
operations. Operations may here be referred as military activities or simply the operations that an
executive performs in his organisations while taking decisions. Research in the word means that finding a
new approach. That is when an executive is involved in performing his operations for taking decisions he
has to go for newer ways so that he can make a better decision for the benefit of his organisation.
