1. DECISION MAKING - An essence to problem solving

2. WHAT IS DECISION MAKING? “ the process of responding to a problem by searching for and selecting a solution or course of action that will create value for organisational stakeholders”.

3. MANAGERIALDECISIONMAKING FOUR STEPS IN THE DECISION MAKING PROCESS DECISION MAKING STEP 1 IDENTIFY THE PROBLEM STEP 2 GENERATE ALTERNATIVE SOLUTIONS STEP 4 IMPLEMENT & MONITOR THE CHOSEN SOLUTION STEP 3 EVALUATE & CHOOSE AMONG ALTERNATIVE SOLUTIONS PROBLEM SOLVING

4. STEPS IN AN EFFECTIVE DECISION MAKING PROCESS

6. DIFFERENCES IN DECISION MAKING SITUATIONS NONPROGRAMMED DECISIONS :Decisions for which Predetermined Decision Rules are impractical because the situations are novel and / or relatively unstructured UNCERTAINTY A condition in which the decision maker must choose a course of action without complete knowledge of the consequences that will follow implementation RISK The possibility that a chosen action could lead to losses rather than the intended results e.g. : Faced with rapid change & declining US $, Annette Roux, Head Chantiers Beneteau in France opened plant in Carolina to manufacture Sailboats

7. Programmed vs. Non-programmed Decisions :

8. EXAMPLES OF MANAGERIAL DECISION MAKING SITUATIONS

11. Individual Models of Decision-Making Cognitive style Underlying personality dispositions toward the treatment of information, selection of alternatives, and evaluation of consequences. Systematic decision makers People who approach a problem by structuring it in terms of some formal method. Intuitive decision makers People who approach a problem with multiple methods in an unstructured manner, using trail and error to find a solution. Organizational models of decision making Models of decision making that take into account the structural and political characteristics of an organization.

12. Organizational Models of Decision-Making Bureaucratic models of decision making where decisions are shaped by the organization’s standard operating procedures(SOPs). Political models of decision making where decisions result from competition and bargaining among the organization’s interest groups and key leaders. “Garbage can” model where states that organizations are not rational and that decisions are solutions that become attached to problems for accidental reasons.

13. GROUP DECISION MAKING ADVANTAGES & DISADVANTAGES OF GROUP DECISION MAKING

14. Common decision-Making errors and Biases Overconfidence Immediate Gratification Hindsight Self-serving Anchoring Effect Decision-Making Errors & Biases Sunk costs Selective Perception Randomness Confirmation representation framing Availability

18. Application of limiting factor- limiting factor should be taken into account in order to analyze the external S & W.

19. Adequate information- more quantity of reliable information leads to effective decision making.

20. Considering other views- various views at the same point are taken into account for quality decision.

22. Nominal group technique (NGT)- problem outlined, presentation of solution in written form, discussion over written solutions, and final decision.

23. Delphi technique- decision made on the basis of questionnaire filled by the respondents.