Decision making , rr mob.2011(3)

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Decision making , rr mob.2011(3)

  1. 1. Decision Making Process Unit II
  2. 2. Decision making.– The process of choosing a course of action for dealing with a problem or opportunity. 2
  3. 3. How are decisions made in organizations? Steps in systematic decision making. – Recognize and define the problem or opportunity. – Identify and analyze alternative courses of action, and estimate their effects on the problem or opportunity. – Choose a preferred course of action. – Implement the preferred course of action. – Evaluate the results and follow up as necessary. 3
  4. 4. Decision-Making Conditions 4
  5. 5. Types of Decisions.1. Programmed Vs Nonprogrammed decisions – Programmed decisions. • Involve routine problems that arise regularly and can be addressed through standard responses. – Nonprogrammed decisions. • Involve nonroutine problems that require solutions specifically tailored to the situation at hand2. Major Vs Minor decisions3. Individual Vs Group decisions 5
  6. 6. Conditions that Affect the Possibility of Decision Failure Organizational Problem Low Possibility of Failure High Certainty Risk Uncertainty Ambiguity Programmed Nonprogrammed Decisions Decisions Problem Solution 6
  7. 7. 1. Rational Perspectives on Decision Making 7
  8. 8. Six Steps in the Managerial Decision Making Process 8
  9. 9. Decision Making StepsStep 1. Recognize Need for a Decision – Sparked by an event such as environment changes. • Managers must first realize that a decision must be made.Step 2. Generate Alternatives – Managers must develop feasible alternative courses of action. • If good alternatives are missed, the resulting decision is poor. • It is hard to develop creative alternatives, so managers need to look for new ideas. 9
  10. 10. Decision Making StepsStep 3. Evaluate Alternatives – What are the advantages and disadvantages of each alternative? – Managers should specify criteria, then evaluate. 10
  11. 11. Decision Making StepsStep 3. Evaluate alternatives 11
  12. 12. Decision Making StepsStep 4. Choose Among Alternatives – Rank the various alternatives and make a decision – Managers must be sure all the information available is brought to bear on the problem or issue at hand 12
  13. 13. Decision Making StepsStep 5. Implement Chosen Alternative – Managers must now carry out the alternative. – Often a decision is made and not implemented.Step 6. Learn From Feedback – Managers should consider what went right and wrong with the decision and learn for the future. – Without feedback, managers do not learn from experience and will repeat the same mistake over. 13
  14. 14. The Administrative Model of Decision Making 14
  15. 15. The Scope of Decision Making 1. Individual decision making 2. Group decision making 3. Organizational decision making 4. Metaorganizational decision making 15
  16. 16. Advantages and Disadvantages ofGroup and Team Decision Making 16
  17. 17. Methods of Group Decision Making• Nominal Group Technique – Members silently and individually generate ideas – They present without discussion – Discussion and clarification – Silently rate – Group decision is the pooled outcome of votes 17

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