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Problems in Decision Making

This document outlines the key steps in the decision making process: 1) recognize the decision requirement by identifying problems or opportunities, 2) diagnose and analyze the causes through understanding questions, 3) develop alternative solutions, 4) select the desired alternative based on risk, prospects, and experience, 5) implement the chosen alternative through communication and leadership, and 6) evaluate the decision through feedback to improve future decisions. It also presents three models of decision making - rational, bounded rationality, and intuition - and provides a case study example of using the process to address a store's stagnant monthly profits.

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ratna noviani
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64 views

Problems in Decision Making

This document outlines the key steps in the decision making process: 1) recognize the decision requirement by identifying problems or opportunities, 2) diagnose and analyze the causes through understanding questions, 3) develop alternative solutions, 4) select the desired alternative based on risk, prospects, and experience, 5) implement the chosen alternative through communication and leadership, and 6) evaluate the decision through feedback to improve future decisions. It also presents three models of decision making - rational, bounded rationality, and intuition - and provides a case study example of using the process to address a store's stagnant monthly profits.

Uploaded by

ratna noviani
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Problems in

Decision Making
By. Enny Fathurachmi
“Good Decision Making is a vital part
of good management, but decision
making is not easy”

GOOD DECISION MAKING


1. Rational Model
2. Bounded Rationality
3. Intuition

Models of Decision
Making
1. Recognize decision requirement
2. Dignosis and analysis of causes
3. Development of alternatives
4. Selection of desired alternatives
5. Implementation of alternatives
6. Evaluation and feedback

Six Steps of Desicion


Making
• Awareness of a problem or opportunity
is the first step in the decision-making
sequence
• Some information comes from periodic
financial reports, performance reports,
and other sources that are designed to
discover problems before they become
too serious

Recognize Decision
Requirement
• Once a problem or opportunity
comes to manager’s attention the
understanding of the situation
should be refine
• On this step the manager try to
diagnosis cause and effect

Diagnosis and Analysis


1. Disequilibrium?
2. When did it occur?
3. Where did it occur?
4. How did it occur?
5. Urgency?
6. Interconnectedness?
7. Result?
Questions to Understand
Causes
To get to the root of a problem,
a technique sometimes called
“the 5 why”

Why
• The next stage is to generate pssible
alternative solutions that will respond to
the needs of the situation and correct the
underlying causes
• Decision alternatives can be thought of as
tools for reducing the difference between
the organization’s current and desire
performance

Develop Alternatives
• Once feasible alternatives are developed,
one must be selected
• Selection
1.Least amount of risk and uncertainty
2.Try to gauge the prospects for success
3.Rely on their intuition and experience
4.Depend on managers’ personality

Select Alternative
• Implementation is all about the use of managerial,
administrative and persuasive abilities to ensure that the
chosen alternative is carried out
• Implement
1. Success depent on if it can be put into action
2. Sometimes never become reality
3. Require discussion, trust, and engagement
4. Communication, motivation, and leadership
5. Follow up by tracking success

Implementation of
Alternative
• Decision makers gather information that tells them how
well the decision was implemented and whether it was
effective in achieving its goals
• Feedback
1. Helps managers make better decisions
2. Ongoing process
3. Provides information for new decision cycle
4. Providing modest improvement
5. Feedback is monitoring

Evaluation and Feedback


In group role play for management
situation
• One play as manager of store
• The situation is stagnan on month by
month
• Follow the step to find best
alternative increasing the profit

Case Study

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