Factors that affect decision making
There are many factors that can make decision making difficult or affect the quality of decisions.
Finance
There may not be finance available to the business to make the decisions they would like to.
For example, a business may wish to invest in new machinery to increase production but they do not have enough capital to allow them to do this.
Human resources
The quality of decisions made by managers can be affected by:
- their skills and expertise
- the amount and quality of information they have available
The staff involved in implementing the decision need to be willing to cooperate and work with the decision for it to be successful.
Senior managers may not agree with the decisions.
Existing company policy may restrict the decisions a manger is allowed to make.
Technology
Lack of the correct equipment or technology may restrict the decision-making process.
Other factors
The decision-making process may also be affected by:
- amount of time available to make the decision
- external pressures such as exchange rates and economic stability