The Decision Making (DM) section is what sets XAT apart from other MBA entrance exams. Instead of testing formulas or speed, it evaluates how you approach ethical, managerial, and real life dilemmas. Many aspirants struggle here because there’s no single “correct” answer. The trick is to learn how to think like a responsible manager.

Sample DM Scenarios

Scenario 1: Employee Layoffs

Your company is facing losses. The management suggests laying off 200 employees to cut costs. Another option is to reduce everyone’s salary by 10%. What should you do?

How to Think:

• Identify stakeholders: employees, company, customers.

• Ethical + practical balance: layoffs affect families, morale; salary cuts share the burden.

• Best answer usually: salary reduction (short-term sacrifice, long-term stability).

Scenario 2: Customer Complaint

A loyal customer receives a defective product just before a festival and demands replacement within 24 hours. Logistics make it nearly impossible.

How to Think:

• Stakeholders: customer, brand reputation, operations team.

• Avoid extreme choices (ignore vs promise the impossible).

• Balanced option: offer immediate refund/partial compensation + arrange quickest possible delivery.

Scenario 3: Conflict of Interest

You are on the selection panel of a company. One of the candidates is a close relative of your senior manager, and he hints that you should favor them.

How to Think:

• Stakeholders: candidate, company, ethics, your career.

• Ethics > personal influence.

• Best approach: ensure fair evaluation process; document your decision-making to avoid bias.

Scenario 4: Environmental Responsibility

Your factory can save ₹10 crores annually by ignoring a pollution control upgrade. If installed, profits dip but the factory stays eco friendly.

How to Think:

• Stakeholders: company, society, environment, government.

• Long term sustainability > short-term profits.

• Ethical decision: invest in pollution control, protect reputation and compliance.

 Key Takeaways for DM

1. Always map stakeholders before answering.

2. Eliminate extreme/unethical options.

3. Balance practical feasibility with ethics.

4. Practice with past year XAT DM questions to learn the examiner’s logic.

So at the end decision making in XAT isn’t about “guessing the examiner’s answer.” It’s about showing maturity, fairness, and a long term managerial perspective. With regular practice, this section can become a high scoring differentiator.