Information Processes for Organisational Decision-Making

Information processes for organisational decision-making

In a business environment, it is important to have a good quality and quantity of information available while making a business decision. However, this information does not come easily; we need to understand the full process of information gathering and how to apply it to our individual businesses.

Firstly we will look into assessing the information we need. It must be specific for the situation and specific for the users. An example is the case of a restaurant manager thinking about increasing the profit of his business. He can introduce more dishes to attract more customers, introduce takeaway or home delivery, renting the next door shop and increase the seats available, extending the working hour, improve the current service to the customers, giving special meal deals at certain times of the day or days of the week that the business is usually not very good, etc. With all these ideas, the managers need information. For example, in introducing more dishes, he need to know what the restaurant are capable of producing and what the customers like to eat; in introducing home delivery, he need to know how feasible it is of actually doing it and the demand for it; in renting the next door shop, he need to know how much the rent is, the demand, and expansibility of the management to accommodate for the increase workload. Other than those information, he also need to have good communication with the customers and staff. He need to know about the customers in many ways to help with those decisions and communicate with staff to make sure they are happy with the decisions. These communication need to happen frequently and their feedbacks are also extremely important, as they are the people who are also directly involved with the business.

Once a clear understanding is formed of what information will be needed, the next step is to establish ways to collect them. There are many different sources of information for different businesses. To demonstrate with an example, I have chosen a particular industry that I am familiar with- food business (restaurant). I will try to point out the pros and cons of each source of information. The right information source can provide an organisation with valuable and reliable information that can help create an advantage within a particular business environment.

Customers can form a very valuable information source, as they are the number one priority to the business. The information from customers can be gathered in many different ways, including surveys and simply talking to them. In the restaurant, this is usually done more casually by talking with the customers and inviting their comments. They can usually tell us very useful information. For examples, workers in a company nearby will tell you how many workers they have in the company, where and what they usually have for their meals and what time they are having their lunch break, their problems of not getting seats during the peak time and that they value meals to be served quickly due to the time limit. Talking to a dad who brings his family to eat in the weekend will tell you that it is easy to find parking in the weekend and there are plenty of choices to choose from etc. These can all provide extremely valuable information for the business. However, the manager must be careful that the customers interviewed are reflective of the majority of the customers coming to the restaurant and hence not be biased.

Mass media can be a valuable tool too. Newspapers, speciality magazines, radio and television can all provide information relevant to today’s decision makers. It is usually up to date, and of a high quality, and due to specialisation can cover areas in which the organisation is interested. However, there are several disadvantages that mass media has. Because everybody will potentially have access to it, it means that most of your competitors will also have the same information hence it will be harder to generate competitive advantage. For a restaurant owner, this source of information will mainly just act as a supplement eg he may know from the media that there has been another restaurant opened nearby who will be the competitor, he may know news about commercial property for sales that are in good location and hence to be a good choice for