Group Decision Making

The process of making decision by involvement of group rather than a single individual is known as group decision making. Groups play an important role in decision-making in organizations. Most of the decisions in organizations are made in a group context because they offer the advantages of experience, wide knowledge, and mutual support. Groups such as committees, study teams, task forces, and review panels are especially useful for non-programmed decision because these decisions are complex and few individuals have all the knowledge and skills necessary to make the best decisions.

Advantages

1. Group can have more complete information, experience, and perspective that is lacking in a single individual.
2. A group can identify more alternative than individual.
3. A decision made by group is generally accepted by all.
4. Decision made by a group is considered as more legitimate then the decision made by a person.
5. Group decision making is suitable for non-programmed decisions.

Disadvantages:

1. Group decision making is a time consuming process.
2. In group decision making, there is chance of dominance over minority by the majority.
3. One person can not be held responsible for the wrong decision.
4. May create conflict between supporters of different views.
5. Requires good group management and communication skills.

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Quantitative Tools for Decision Making

1. Linear Programming
2. Simulation
3. Break- Even Analysis
4. Queuing Theory: This theory is also known as waiting-line theory. This theory is basically used to manage waiting lines. When people wait in a line to get particular service, they form a queue. This theory is a process of calculating probability for determining the number of person who is waiting in a queue to get service. With the help of this technique the organization will be able to decide about the allocation of resources so that all customers who are waiting in a line can be satisfied.
5. Game Theory:  This theory assumes that business situation has great similarity with game. It explains how rational people behave in a competing situation. Thus it is used in formulating strategy against competition. This theory helps manager to be prepared against the move of competitors.