Decision Making


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Umer Awan

Published in: Business

Decision Making

  1. 1.  Group Members: Imran Muzamil (0064) Fiaz Riaz (0014) M.Umer (0116)
  2. 2. Topic:Decision Making StepsImran MuzamilReg no. (0064)
  3. 3.  Definition:A choice between two or more then twoalternatives is called decision
  4. 4.  Identify the Problem:When making a decision a personfirst needs to identify and definethe problem or conflict.
  5. 5.  Identify Decision Criteria:When a problem identified,the decision criteria importantto resolving the problem mustbe identified. That is, managersmust determine what isrelevant in making decision.
  6. 6.  Allocation of Weights to criteria:If the relevant criteria are notequally important, the decisionmaker must weight the itemsin order to give them thecorrect priority in thedecision.
  7. 7.  Development of Alternatives:The fourth step in decision makingprocess requires the decisionmaker to list viable alternativethat could resolve. The problemthis is the step where a decisionmaker needs to be creative.
  8. 8.  Choose One alternative:After making all the alternatives,the next step in planning or indecision making is to evaluatethese alternatives. Evaluation isrequired in order to select thebest alternative for implementation.
  9. 9.  Implementation of the Alternative:After choosing best alternativedecision in to action by conveyingit to those effected and getting theircommitment to it.
  10. 10.  Evaluation of Decision effectiveness:The last step the decision makingProcess involve evaluating the outcomeor result of the decision to seeif the problem is resolve.
  11. 11. Topic:Manager Making Decisions & Types ofDecision MakingFiaz RiazReg no.(0014)
  12. 12.  Rationality:A type of decision making in which choices are logicalconsistent and maximize value. Bounded Rationality:Decision making thats rational but limited(bounded)by an individuals ability to process information. Intuition:Making decision on the basis of experience, andaccumulated judgment.
  13. 13.  Structured Problem:A straightforward, familiar and easily definedproblem. Problem Decision:A repetitive decision that can be handledusing a routine approach.
  14. 14.  Unstructured Problem:A problem that is new or unusual and for whichinformation is incomplete. Non Programmed Decisions:A unique and nonrecurring decision that requires acustom made solution.
  15. 15.  Certainty:Implies perfect information. All relevant information tothe problem is known. Risk:Implies partial information. Some of all the relevantinformation to the problem is stochastic. Uncertainty:Implies incomplete information. Some of all therelevant information to the problem is missing.
  16. 16. Topic:Decision Making Biases & ErrorsM.UmerReg no.(0116)
  17. 17.  Decision Making Bias:Decision making bias is giving a undueinfluence to any one in between two equalthings. Decision Making Error:In Decision making error is a occurrence ofany thing with out knowing.
  18. 18.  Overconfidence Bias:In overconfidence bias a manager think that he will doevery thing but real thing some time opposite. Immediate Gratification:Immediate Gratification describes a manager want toimmediate reward.He will prefers Rs.100 of today other then Rs.200 offuture.
  19. 19.  Availability Bias:In Availability bias a manager to base their judgmenton information that is readily available to him.E.g. A person fear from Air travel and also car driving.Media report show much more attention on aero plancrash is 10% and 8% car accident & he will understatecar accident and travel in car. Representative Bias: In representative bias a person see another personsrepresentative performance and predict that he can also thisdo this work.
  20. 20.  Escalation Bias:Escalation of commitment refers to staying with adecision even when there is clear evidence that iswrong. Selective Perception:When decision maker selectively organize andinterpret a decision on the base of his perception.
  21. 21.  Randomness Error:Most of the managers believes that they havesome control over the world and destiny. Andif we undoutly control a good part of eventbut truths is world always having Randomevents .And our tendency to believe we can predictfuture event.