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Decision Making

The document discusses decision making in management. It defines decision making as identifying and selecting a course of action to solve a problem. Managers must recognize problems and opportunities. Rational decision making involves logically considering alternatives based on criteria and choosing the best option. Managers can select alternatives through experience, experimentation, or research and analysis. Decisions can be programmed, involving routine problems, or non-programmed, involving unique problems. Decision making can occur under conditions of certainty, uncertainty, or risk depending on the available information.

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Avinash Dulhani
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43 views

Decision Making

The document discusses decision making in management. It defines decision making as identifying and selecting a course of action to solve a problem. Managers must recognize problems and opportunities. Rational decision making involves logically considering alternatives based on criteria and choosing the best option. Managers can select alternatives through experience, experimentation, or research and analysis. Decisions can be programmed, involving routine problems, or non-programmed, involving unique problems. Decision making can occur under conditions of certainty, uncertainty, or risk depending on the available information.

Uploaded by

Avinash Dulhani
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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DECISION MAKING

The process of identifying and selecting a course of action to solve a specific problem.

Problem & opportunity finding Problem-Situation occurs when there is a difference b/w actual affairs and desired affairs Opportunity- Situation occurs when circumstances offer an organization the chance to exceed stated goals and objectives. Ex- Problem- Customers complaints about slow delivery of orders. Opportunity- To redesign production process and customer service. (Example shows effective managers recognized both problems and opportunity. This lead managers act.)

Time and human relations in decision making

Rationality in decision making


Rational decision making models involve a cognitive process(involved knowing, learning &understanding) where each step follows in a logical order from the one before. By cognitive, Its mean it is based on thinking through and weighing up the alternatives to come up with the best potential result.

Steps in a rational decision making model


Define the situation to be made Identify the important criteria for the process and the result Consider all possible solutions Calculate the consequences of these solutions versus the likelihood of satisfying the criteria Choose the best option

Selecting an alternative with 3 approaches


For selecting an best alternative ,mangers can choose three basic approaches: Experience Experimentation Research and analysis

Process of decision making

Managerial decision making through Programmed and Non-programmed decisions Programmed decisions- Solutions to routine problems determined by rule, procedure, or habit.(Salary for new employee) Non-programmed decisions Specific solutions created through unstructured process to deal with nonroutine problems.(Recession)

Decision making under Certainty, Uncertainty and Risk


Certainty- Decision making condition in which managers have accurate, measurable and reliable information about the outcomes of various alternatives under consideration. Uncertainty- Decision making condition in which managers face unpredictable external conditions or lack the information needed to establish the probability of certain events. Risk- Decision making condition in which managers know the probability of a given alternative will lead to desire goal or outcome.

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