Models of Decision Making :: Business Management

MODELS OF DECISION MAKING tog out Analysis Model Posters Five Forces Analysis PEST AnalysisSWOT AnalysisSWOT Analysis is the most common and renowned model for decision making in the business world today. It is used for conducting the audit, study and analyze the overall strategic position of the business and the environment in which the business operates SWOT is an abbreviation of Strengths, Weaknesses, Opportunities and Threats. The principal(prenominal) objective of SWOT analysis is to devise the best strategy for the organization, using it to prepare the business model for the company while keeping in scene the resources, capabilities and constraints that are applicable. It is in fact used to assess the internal potential of the organization and how it can be utilized to exploit the avenues available in the environment. It takes into rumination all the favorable and unfavorable factors associated with the organization. This tool when used consistently can help in the predicting the future outcome and including those forecasts in the organizations strategy.Conducting SWOT analysis is not a complex task but includes a very simple and interesting activity. It also includes brainstorming sessions. SWOT analysis may be used to develop the business idea, assessing an opportunity to make an acquisition, analyzing a potential partnership or making decision about a brand, product, an coronation opportunity. SWOT analysis is conducted using a template which is usually in the form of a grid and consists of four sections.An example of the template is produced below STRENGTHSfiscal ResourcesHuman ResourceMarket AccessBrandsPatentsCopy RightsTechnology InfrastructureQuality Cost minimizationEffective managementGeographical strand expertise and ExperienceBackward and Forward IntegrationOther assetsWEAKNESSCash shortage or lack of access to financial resourcesLack of access to securities industry placeIncompetent human resource and managementLack of i nfrastructureNon availability of technologyLack of competitive strengthsIneffective supply chain management define Product RangePoor Decision MakingHuge DebtsHigh employee turnoverObsolete equipmentComplex decision making processLarge wastage of cranky materialOPPORTUNITIES New marketNew Government policy or change in recent policyLifestyle or industry street corner marketIncrease in level of income of individualsNew Products and services THREATSPolitical factorsLegislative issuesEnvironmental factorsHigh turnover of staffTakeover by a big giantNew technology by competitorDisagreement with key contractors and customersSeasonal impactsChange in attitude, tastes or lifestyleInternational market impacts on local marketChange in the market demandEver changing technologyPrice war leading to decrease in profitabilityIncreased competition leading to access capacity Lets have a view on each of the four factorsStrengthsStrengths are the competitive edge or the capabilities an organization h as to be utilized when competing with its competitors.