“Decision-making is the process of identifying and choosing alternatives based on the values and preferences of the decision-maker.”
Decision is an element which is a source of confusion in our mind in a variety of circumstances. When we are shopping for grocery and vegetables, normally we have confusion and need to take some decision. Even choosing a school for our child, we are in confusion but need to take a decision. On a larger scale, when a company faces an opportunity to enter into a new market, acquire another company or launch a new product, where management’s decision is important and critical. These are the strategic decisions, which involves developing a long term direction and vision & objective of the entire organisation. Thousands of employees, stakeholders, vendors, customers are dependent on the strategic decision made by the management. So we can imagine the mental pressure in the minds of top executives, entrepreneurs and business owners. Now we will see how the thought process helps in strategic decision making.
In our last article, we have discussed about belief system and introspection of assumptions in our mind. Our thoughts themselves ignite for making assumptions in our belief system and make impact on our emotions. In strategic decision making, we need to think from different perspectives and need to consider variety of circumstances but we always think through the assumptions in our mind. When we are introspecting our assumptions, we need to make those assumptions logically structured and reasonable. This process results in Rational thinking. Now we will see the famous example of rational thinking in strategic decision-making.
Toyota cars entered Indian market in 1997 and launched its first multi-utility vehicle ‘QUALIS’ in 2000. Toyota QUALIS has picked up the market in a very less time and was selling like a hot cake. QUALIS was most selling multi-utility vehicle in India at that time but suddenly Toyota had taken a decision to withdraw QUALIS in 2005 and launched ‘INNOVA’ in the market. Toyota wanted to project their cars as most customer-value driven cars. QUALIS was famous as Tourist car but Toyota wants to make their vehicle’s identity as a family car so they launched INNOVA.
Toyota had taken a strategic decision with a rational thought process to withdraw their most selling vehicle in India. We also can make our thought process channelised and rational to take best strategic decisions in business and any decisions in our personal life. But it needs consistency and persistence to change our thought process. As we mentioned earlier, emotions also play a vital role in making rational thought process.
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