Role of Information Technology in Decision Making - I.T. Project Management

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There are different types of decision, they include programmed decision and a non-programmed decision. There are different models for decision making such as classical economic model,administrative model and Herbert Simons model of decision making. 

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Role of Information Technology in Decision Making - I.T. Project Management

  1. 1. Welingkar’s Distance Learning Division I.T. for Management CHAPTER-9 Role of information in Decision making We Learn – A Continuous Learning Forum
  2. 2. Welingkar’s Distance Learning Division Role of Information in Decision Making Conceptual model of Decision Making • Managers deal with problems posing threats and offering opportunities. • Managers can be problem avoiders, problem solvers, or problem seekers. • Managers display systematic and intuitive problem- solving styles. • Managers make decisions under conditions of certainty, risk, and uncertainty. • Managers solve problems with programmed and non programmed decisions. We Learn – A Continuous Learning Forum
  3. 3. Welingkar’s Distance Learning Division Role of Information in Decision Making Types of Decision • Certain Environment • offers complete information on possible action alternatives and their consequences. • Risk Environment • lacks complete information but offers probabilities of the likely outcomes for possible action alternatives. • Uncertain Environment • lacks so much information that it is difficult to assign probabilities to the likely outcomes of alternatives. We Learn – A Continuous Learning Forum
  4. 4. Welingkar’s Distance Learning Division Role of Information in Decision Making Types of Decision • Decision • a choice among possible alternative courses of action. • Programmed Decision • applies a solution from past experience to a routine problem. • Non programmed Decision • applies a specific solution crafted for a unique problem. We Learn – A Continuous Learning Forum
  5. 5. Welingkar’s Distance Learning Division Role of Information in Decision Making We Learn – A Continuous Learning Forum
  6. 6. Welingkar’s Distance Learning Division Role of Information in Decision Making Conceptual model of Decision making Classical Economic model This nominative model is based on the following assumptions: • All decisions and outcomes are completely known • The model states that the decision maker always seeks to maximize profit or utility • The decision maker is infinitely sensitive to difference in utility among outcome • Decision making in the business context is nothing but a set of tradeoffs We Learn – A Continuous Learning Forum
  7. 7. Welingkar’s Distance Learning Division Role of Information in Decision Making Conceptual model of Decision making Administrative model It works on the concept of bounded rationality It assumes that the decision maker • Does not know all the alternatives and outcomes • Makes a limited search to discover a few satisfactory alternatives • Makes a decision which satisfies his or her aspiration The decision maker has to do a balancing act between the conflicting trade-off’s We Learn – A Continuous Learning Forum
  8. 8. Welingkar’s Distance Learning Division Role of Information in Decision Making Conceptual model of Decision making • Human expectations and decision making • Humans display a variety of responses in decision-making • Anticipatory regret is a psychological response to alternatives, it inhibits the decision maker from making a decision without contemplating the consequences. • Decision making under psychological stress • This concept is important to the design of information systems, because a decision support system to be used under conditions of decision conflict & may not effective unless it takes care of behavior under psychological stress We Learn – A Continuous Learning Forum
  9. 9. Welingkar’s Distance Learning Division Role of Information in Decision Making Conceptual model of Decision making Herbert Simons model of decision making This model divides the process into 3 phases • Intelligence phase • Searching the environment conditions calling for decision data inputs are obtained ,processed & examined for clues that may identify problems or opportunities • Design phase • Inventing ,developing possible course of actions • Choice phase • Selecting one of alternative, or course of actions We Learn – A Continuous Learning Forum
  10. 10. Welingkar’s Distance Learning Division Role of Information in Decision Making Herbert Simons model of decision making We Learn – A Continuous Learning Forum
  11. 11. Welingkar’s Distance Learning Division Role of Information in Decision Making Herbert Simons model of decision making • Step 1 is to identify and define the problem. • Step 2 is to generate and evaluate alternative courses of action. • Step 3 is to decide on a preferred course of action. • Step 4 is to implement the decision. • Step 5 is to evaluate results. We Learn – A Continuous Learning Forum
  12. 12. Welingkar’s Distance Learning Division Determining Information Need Data Flow Methods End of Chapter 9 We Learn – A Continuous Learning Forum

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