What are the elements of programmed decisions?
The modern techniques for making major decisions on routine but complex problems are mostly quantitative. They are based on the scientific method, the most salient elements of which are the following :
- Statement of clear objectives.
- Definition of the problem.
- Formulation of hypotheses.
- Collection of facts.
- Testing the hypotheses.
- Explanation of results.
The aim is to help managers to make precise and perfect decisions for efficient utilisation of scarce resources. Quantification of variables and determination of relationships amount them through mathematical equations helps the process of arriving at optimal decisions.