Decision - making, Managerial Accounting

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Decision Making

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Some managers appear to have an intuitive sense of good decision making. The reality is that good decision making is hardly ever done by intuition. Consistently excellent decisions can only result from diligent accumulation and evaluation of the information. This is where managerial accounting comes in action

-- providing the information required to fuel the decision making process. Managerial decisions can be categorized according to the three interrelated business processes: planning, controlling directing are very important. Accurate execution of each of these activities culminates in the creation of business value. Conversely, failure to plan, control or direct is a roadmap to business failure.

The core theme to focus on is this:

 (1) business value results from good management decisions,
(2) decisions should occur across a spectrum of activities (planning, controlling and directing), and (3) quality decision making can only consistently happen by reliance on information.
Thus, it implores you to see the relevance of the managerial accounting to your success as a business manager. Let's now take a nearer look at the components of planning, controlling and directing.


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