Decision-making is one of the key areas of expertise every organisation expects from managers. One decision could make the results favourable or unfavourable. Top officials leverage several methods to decide on certain factors, such as increasing the downward sales trend, new addition to the current product, etc.
Since decision-making skill is the bread and butter for you, you must know the quantitative techniques in the decision-making process. But before that, let’s see the meaning, characteristics, and limitations of the same.
What is Quantitative Technique?
Quantitative techniques are a collection of programming and statistical techniques that influence your decision-making process, especially about industry or business. It considers the use of numbers, mathematical expressions, and symbols. The quantitative technique contributes significantly to judgment and assesses factors to consider planning and alternatives when they arise.
Characteristics of Quantitative Techniques
There are four characteristics of quantitative techniques, which includes:
The scientific approach involves obtaining data by testing each set and experimenting with them. The process consists in observing the experiment, creating a hypothesis, and predicting and analysing results.
2. Objective-Oriented Approach
This approach aims to gather information system behavioral patterns into small and separate packets that combine data and processes. This approach aims to enhance the quality and productivity of the system analysis, making it productive.
3. Interdisciplinary Approach
When there are multi-dimensional problems, you need teamwork to accomplish the objective. For instance, if there are managerial problems, everything at the workplace can get hampered, including physical, economical, sociological, and psychological.
Quantitative technique makes a major contribution to the decision-making process. A general systematic approach includes managerial decisions.
Now that you know the characteristics of quantitative techniques let’s discuss some disadvantages of the same.
Pitfalls of Quantitative Techniques in Decision-Making
Only counts quantifiable data
One of the drawbacks that could influence the decision-making process is the consideration of quantifiable data. If the data aren’t quantifiable, then it doesn’t get into consideration.
When needed, certain assumptions and estimates are added to factor and calculate. With the help of this, you can perform quantitative analysis. The forecast has to be correct to prove the results to be favourable.
Time & Cost consuming
Quantitative techniques require big time and money for significant results. It requires professionals to attempt research. The professionals need to review the situation and based on that constantly, they must make the decision.
The dependency on Computers increases due to the involvement of mathematical skills and several factors. And due to this, the decision to avoid using computers becomes baseless since computers do heavy calculations.
Along with other factors, human behaviour also counts when making decisions based on quantitative techniques.
How does Quantitative Technique help in the Decision Making Process?
Not every single task gets scrutinised in a large organisation; the quantitative approach identifies the problem. The technique is also leveraged to adopt production scheduling and inventory replenishment.
Accurate decision-making process
Quantitative technique contributes to making the right decision, lowering the error margin. With the help of this technique, one can look at the picture with a clearer vision, and the chances of wrong-decision tend to be minimal.
Due to the quantitative technique, the coordination becomes smoother between inter-departmental.
Improvisation in systems
Since the quantitative approach contributes to the decision-making process, it improves existing systems of choosing a budget-friendly mode of transportation, scheduling production, sequencing jobs, and replacing or repairing old machinery.
Makes basis for scientific analysis
Since business decisions are involved or to be taken, you can not neglect scientific methods. And decisions based on intuitions are not to be taken when making financial decisions.
Offers a solution for business problems
You can rely on quantitative techniques when it comes to solving various business problems. The technique can be used in marketing, production, sales, finance, and marketing. For instance, how to boost the bottom line to maximise revenues. How to increase production to meet the demand.
Selects optimal strategy
If your business faces huge competition, then quantitative techniques can help you choose an optimal strategy to beat the competition. It does it through game theory.
Deploys resources optimally
With the help of quantitative methods, you can predict the time to complete the project. It is also known as the evaluation of the program or review technique.
Scientific analysis tool
When you leverage quantitative techniques, you get access to multiple tools, from mathematics, economics, operational research, and statistics. The tool that you use will help you find problems and their solutions. The solution derived from the tools is unbiased of the top-level authority’s opinion.
Now that you know the importance of quantitative techniques let’s discuss how to become a certified specialist to implement these methods.
Executive Program in Business Management
In the disruptive digital world, all it requires is critical thinking ability, business management, and much more to stay ahead of the competition.
- 11 months duration
- Direct to Device method of teaching
- Simulation-based learning
- Graduation from a recognized university
- 2-years of working experience
- Profile-based selection
Total program fees:
That’s all from our end. Quantitative techniques play a leading role in forming a company or specific work-wide decisions. Get yourself enrolled in the IMT Ghaziabad program and certified by the institute.