Decision Making, Planning, and Control: The Five-Step Decision-Making Process

Learning Objective 4: Explain the five-step decision-making process and its role in management accounting

For the most part, I'm gonna use this chapter to talk about Rimworld. For those who have no clue what that game is, tough luck.

Steps 1-4

1. Identify the problem and uncertainties
1. Especially when first starting out, Rimworld is a survival game. Thus, you need to know if you need to prioritize a food source, sleep, or regulating temperature for your first few nights.
2. There are very few uncertainties regarding sleep outside of where you should put your starting hut, but food and temperature can be far more variable depending on the difficulty of the game.
2. Obtain information
1. The Rimworld wikipedia is chock full of information, from articles of the individual elements of the game to start up guides to help players walk through the process of managing their starting terrain.
3. Make predictions about the future
1. Once you know what problems you are attempting to solve, as well as have information about your problems and options to solve them, you can reasonably estimate what would happen based on the possible paths you can take to solve your problems.
1. For example, you start the game with plenty of food to survive for about a week, meaning you don't need to rush food sources right away. On the other hand, your stranded colonists will need to sleep by the end of the day, and in more extreme maps they will freeze/get heatstroke within a couple of hours. If it took, let's say, half a day to approach each problem, with the previous two steps you will be able to recognize the consequences of each path you can take.
2. Predictions require judgment, and are subject to her own biases and irrationalities. It's important at this stage to test and retest her knowledge, as well as know where facts end and personal opinions begin, in order to outline these possible paths accurately and conclusively.
4. Make decisions by choosing among alternatives
1. When presented with multiple options with seemingly equally viable prospects, it's at this point that strategy and leadership can provide a strong sense of direction for the company and decision making in process. 
1. For example, once the midgame in Rimworld rolls around, the game becomes more about generating wealth and defending yourself from the outside world. If you already entered the game with a strategy in mind, even though there are a menagerie of equally viable options to generate wealth in the game, it's your strategy that gives you a clear path to maneuver through these options.

Steps 1-4 in the Decision-Making Process are collectively known as Planning. This is the stage of the game where you decide your goals and strategies, explore different paths and their outcomes to achieve your goals, and bring people together in order to achieve your goals. Management Accountants are key partners in the planning stage since they often understand the key success factors and what brings value to the company.

You should know what a budget is. Super important in the planning and execution of a Decision. 

     5. Implement the decision, evaluate performance, and learn

1. Once you have decided which path you want to take, implement it and watch what happens. In particular, compare what actually happens to the predictions you made planning the decision out.
1. Your predecision information could include the safety and reliability of starting the game in the house; the speculation required to make a decision. Your Control, or post decision information is all the details of what actually happens. In this case, it's a log of how you built your house, how Randy dropped a meteor on your house, and how you now need to build a second house in the middle of the night.

Analyzing control brings about learning. It's important to review what actually did happen, and proposing new solutions, plans, and possibilities based on control factors to make better informed decisions in the future.

So, how do managers make decisions to implement strategy? They follow a five step process, of
1. Outlining problems
2. Gathering information
3. Exploring possibilities
4. Choosing strategies
5. Execution and learning