3 important Principles of Decision Making According to Louis Allen
According to Louis Allen the following basic principles provide a sound basis for management decisions.
1. The Principle of Definition:
A logical decision can be made if the real problem is first defined. Too often, time and effort are wasted because we do not think through what the problem or the objective is. We may not identify the real problem because we fall to take time to determine the basic factors that must be changed to arrive at a satisfactory solution.
2. The Principle of Adequate Evidence:
A logical decision must be valid in terms of the evidence on which it is based. A manager expert in decision making can back his conclusions with facts or reasonable inferences drawn from facts. When the facts underlying a problem are assembled and understood, the decision will often be obvious.
3. The Principle of Identify:
Facts may seem to differ, depending on the point in time from which they are observed.
From a different perspective, the same object will appear to be different to different people a budget deficit means different things to the accountant, the salesmen, and the engineer. The relative importance of the same facts may differ from year to year,
To establish the validity of our facts, we must try to use the varying viewpoints involved and determine the significance of the time period during which the event happened.