Introduction
First of all, I would like to point out that risk is an issue people comprehend differently. Understanding a risk depends upon numerous aspects, including the area people work within. Generally, one is to keep in mind that there are three types of decision-making. Certainty, risk, and uncertainty are considered to be these basic types. Of course, it is better to avoid risk rather than accept it. However, most of the managers recognize that risk is manageable. Thus, they believe that a person can control risk and even reduce its consequences.
Generally, when speaking about risk, people give many definitions, including commercial risk, a financial one, etc. The idea to produce the best outcomes when the situation is risky or uncertain can’t be considered to be a rational decision process, as the managers are uncertain whether they would meet certain production speeds during a certain period. Taking into account the situation, one can state that this type of risk is difficult to predict.
However, the statement that risk and return are related issues is also to be considered. Anyway, it is necessary to minimize risk and its results. One can state that the best outcomes producing under a risky situation are a rational decision process as risk can be managed. So, it can be manageable, if the manager has “correct information, sufficient knowledge about the problem, and if he or she is experienced in the field it concerns” (Riabacke 3).
On the other hand, some alternatives are also possible. These include information collecting, different aspects of the investigation, and taking measures to reduce risk. So, it is obvious that an intuitive, behavioral process is best used under certainty. However, if the risk can be controlled, the behavioral process can also be used under risk.
Main Body
Of course, a person’s intuition is very important in decision making. However, one is to keep in mind that no interdependence between intuition and organizational performance is found. While relying on intuition, there is a need to remember that the phenomenon is subconscious. Thus, the manager is to take the decision after a long pondering of an issue. On the other hand, one is to understand that intuition is complex.
So, there is a need to overcome the limits of rationality. Finally, the most important point is that intuition is quick; so, the manager is to focus on the critical issues and neglect the irrelevant ones. As far as intuition is considered to be not an emotion; so, while taking the decision no fear or anxiety is to be present. Intuition is not biased; so, there must be some errors. Intuition is a part of most of the decisions.
“In sum, intuition is not an irrational process. It is based on a deep understanding of the situation. It is a complex phenomenon that draws from the store of knowledge in our subconscious and is rooted in past experience” (Khatri & Alvin NG 7).
So, the members of the company are to consider the potential loss and profit of two promising new products can bring. However, such an investigation of pros and cons should be related to major points intuition is based on.
Conclusion
So, in my opinion, evidence-based management in making the company’s decision is one of the most interesting questions. Thus, to make the right decision the company is to analyze qualitative or quantitative data. In other words, there is a need to process hard facts concerning both products. It is necessary to act on better logic. However, there are also numerous side effects, including not enough evidence or too much evidence. Updating assumptions and skills can help to make the right decision. The members of the company are to rely on their past experience, they are to be objective.
Finally, I would like to use the following quotation. It is for the manager. So, “If you keep learning while acting on the best knowledge you have and expect your people to do the same and if you have the attitude of wisdom then your organization can profit from the enlightened trial and error” (Pfeffer & Sutton 18). Thereby, the best way is to analyze the situation and act.
Works Cited:
Jeffrey, Pfeffer & Robert, Sutton. Evidence-Based Management (EBM), 2006. Web.
Naresh, Khatri & H. Alvin NG. Role of Intuition in Strategic Decision Making, n.d. Web.
Riabacke, Ari. Managerial Decision Making Under Risk and Uncertainty. 2006. Web.