This document discusses decision making and the various processes involved. It defines decision making as selecting a course of action from available alternatives. Rational decision making aims to make consistent, value-maximizing choices within constraints through logical multi-step analysis. However, human rationality is limited by our mental capacity. Developing alternatives involves identifying options and comparing them to limiting factors. Alternatives are then evaluated both quantitatively and qualitatively before selecting the optimal choice based on factors like cost-effectiveness. The document also discusses different types of decisions under certainty, uncertainty and risk.
Quantitative decision making involves selecting the optimal course of action from alternatives using statistical techniques. It is a process for achieving goals by choosing the best action given circumstances. Key elements include acts or options, possible outcomes, and payoff tables. Decision making environments include certainty, uncertainty, and risk. Techniques for uncertainty include maximin, maximax, minimax regret, and Laplace criteria. Those for risk include expected monetary value and expected opportunity loss. Common quantitative techniques are correlation, regression, chi square, and analysis of variance.
Here is a handout containing the PowerPoint Presentation contents of the of the Presentation version of this subject.
Decision Making in Terms of Engineering Management.
The document discusses decision making as a key responsibility of engineering managers. It defines decision making as identifying and choosing alternative courses of action appropriate to the situation. The document outlines the decision making process as diagnosing problems, analyzing the environment, developing viable alternatives, evaluating alternatives, making a choice, implementing the decision, and evaluating/adapting the results. It also discusses quantitative models that can be used to aid decision making, such as inventory models, queuing theory, network models, forecasting techniques, simulation, linear programming, sampling theory, and statistical decision theory.
Quantitative analysis and pitfalls in decision makingMelvs Garcia
The document discusses quantitative analysis and common pitfalls in decision making. It begins by defining quantitative analysis as using mathematical tools and data manipulation to derive meaningful information that can aid managerial decision making. Examples are given of companies saving millions through quantitative analysis models. The steps of the quantitative analysis approach are then outlined, from defining the problem to implementing results. Common problems that can occur during these steps and in modeling are discussed. Finally, common pitfalls in decision making are presented, such as being anchored by initial estimates or continuing with past decisions due to sunk costs.
This document discusses managerial decision making. It begins by defining decision as a choice between alternatives and decision making as the process of identifying problems and opportunities to resolve them. It then discusses various characteristics, types, and importance of decision making. The document outlines different decision making models including classical, administrative, and political models. It also discusses decision analysis tools like influence diagrams and decision trees. Finally, it discusses different decision styles like directive, analytical, conceptual, and behavioral. Overall, the document provides an overview of key concepts and approaches related to managerial decision making.
Decision Science involves using quantitative techniques and modeling to help with decision making in organizations. It includes topics like assignment models, transportation models, linear programming, and risk analysis. Decision Science provides frameworks for making decisions under uncertainty and aims to optimize costs and other factors. It is an interdisciplinary field that combines mathematics, technology, and behavioral science to help decision makers solve complex problems and achieve organizational goals.
This document discusses different types of decision making including basic, routine, personal, and organizational decisions. It also discusses programmed versus non-programmed decisions. Effective decision making is described as goal oriented, considering alternatives through a dynamic and continuous social process. The six C's of decision making are outlined as constructing a clear picture of what needs to be decided, compiling requirements, collecting information on alternatives, comparing alternatives, considering what could go wrong, and committing to follow through.
This document discusses decision making and the various processes involved. It defines decision making as selecting a course of action from available alternatives. Rational decision making aims to make consistent, value-maximizing choices within constraints through logical multi-step analysis. However, human rationality is limited by our mental capacity. Developing alternatives involves identifying options and comparing them to limiting factors. Alternatives are then evaluated both quantitatively and qualitatively before selecting the optimal choice based on factors like cost-effectiveness. The document also discusses different types of decisions under certainty, uncertainty and risk.
Quantitative decision making involves selecting the optimal course of action from alternatives using statistical techniques. It is a process for achieving goals by choosing the best action given circumstances. Key elements include acts or options, possible outcomes, and payoff tables. Decision making environments include certainty, uncertainty, and risk. Techniques for uncertainty include maximin, maximax, minimax regret, and Laplace criteria. Those for risk include expected monetary value and expected opportunity loss. Common quantitative techniques are correlation, regression, chi square, and analysis of variance.
Here is a handout containing the PowerPoint Presentation contents of the of the Presentation version of this subject.
Decision Making in Terms of Engineering Management.
The document discusses decision making as a key responsibility of engineering managers. It defines decision making as identifying and choosing alternative courses of action appropriate to the situation. The document outlines the decision making process as diagnosing problems, analyzing the environment, developing viable alternatives, evaluating alternatives, making a choice, implementing the decision, and evaluating/adapting the results. It also discusses quantitative models that can be used to aid decision making, such as inventory models, queuing theory, network models, forecasting techniques, simulation, linear programming, sampling theory, and statistical decision theory.
Quantitative analysis and pitfalls in decision makingMelvs Garcia
The document discusses quantitative analysis and common pitfalls in decision making. It begins by defining quantitative analysis as using mathematical tools and data manipulation to derive meaningful information that can aid managerial decision making. Examples are given of companies saving millions through quantitative analysis models. The steps of the quantitative analysis approach are then outlined, from defining the problem to implementing results. Common problems that can occur during these steps and in modeling are discussed. Finally, common pitfalls in decision making are presented, such as being anchored by initial estimates or continuing with past decisions due to sunk costs.
This document discusses managerial decision making. It begins by defining decision as a choice between alternatives and decision making as the process of identifying problems and opportunities to resolve them. It then discusses various characteristics, types, and importance of decision making. The document outlines different decision making models including classical, administrative, and political models. It also discusses decision analysis tools like influence diagrams and decision trees. Finally, it discusses different decision styles like directive, analytical, conceptual, and behavioral. Overall, the document provides an overview of key concepts and approaches related to managerial decision making.
Decision Science involves using quantitative techniques and modeling to help with decision making in organizations. It includes topics like assignment models, transportation models, linear programming, and risk analysis. Decision Science provides frameworks for making decisions under uncertainty and aims to optimize costs and other factors. It is an interdisciplinary field that combines mathematics, technology, and behavioral science to help decision makers solve complex problems and achieve organizational goals.
This document discusses different types of decision making including basic, routine, personal, and organizational decisions. It also discusses programmed versus non-programmed decisions. Effective decision making is described as goal oriented, considering alternatives through a dynamic and continuous social process. The six C's of decision making are outlined as constructing a clear picture of what needs to be decided, compiling requirements, collecting information on alternatives, comparing alternatives, considering what could go wrong, and committing to follow through.
There are several types of managerial decisions including:
Programmed decisions which follow set procedures and non-programmed decisions which deal with unusual problems.
Major decisions involve large expenditures while minor decisions involve small routine purchases.
Routine decisions are repetitive and operational, while strategic decisions are long-term policy matters that require careful analysis.
Organizational decisions reflect company policy while personal decisions cannot be delegated.
Individual decisions are made alone following guidelines, and group decisions are made by committees on important matters.
Policy decisions set long-term direction while operational decisions manage daily operations.
Long-term decisions carry more risk, departmental decisions impact a single group, and non-economic decisions consider technical and moral
Organizational Planning And Goal Setting MGT 201 Helpful Slides For Management Students Of Different Universities In Karachi And All Over Pakistan And World
The document discusses quantitative analysis and decision making in management science, outlining the 7 steps of problem solving, uses of quantitative analysis, how to develop mathematical models, and providing an example of how management science could be used to model and solve a project scheduling problem to minimize completion time. Key aspects of models include objective functions, constraints, decision variables, and whether models are deterministic or stochastic.
The document discusses different models and approaches to decision making. It describes the economic man model which involves fully rational decision making to maximize returns. However, it also introduces the administrative man model which recognizes that in reality, managers have bounded rationality due to limitations of time, information, and skills. The document also outlines different types of decisions like programmed vs non-programmed and strategic vs tactical vs operating decisions. Finally, it lists some typical steps involved in the decision making process.
1) The document discusses tools and techniques for managerial decision making. It explains that decision making is a process that involves multiple steps: establishing objectives, identifying alternatives, evaluating alternatives, selecting the best option, implementing, and monitoring performance.
2) Several economic tools are described that can help managers in decision making, including opportunity cost, incremental principle, time perspective principle, discounting principle, and equi-marginal principle. These tools help managers evaluate costs and revenues of different alternatives.
3) Managerial decision making is influenced not just by economics but also human/behavioral factors, technology, and the external environment. A variety of concepts from economic theory can assist managers in analyzing problems and making informed choices.
This document discusses various aspects of decision theory including models of decision making, decision trees, decision styles, decision theories, group decision making, and improving decision making. It describes the classical, implicit favorite, and intuitive models of decision making. It also outlines four decision styles - directive, analytical, conceptual, and behavioral. Two major decision theories - classical and behavioral - are explained along with their key aspects. Methods for improving individual and group decision making are also provided.
Business impact analysis and Cost-benefit Analysis. Risk Assesmenterfan7486
This document discusses business impact analysis (BIA), cost/benefit analysis (CBA), and risk assessment methods. It defines BIA as identifying key business areas, critical functions, acceptable downtime, and dependencies to understand potential impacts of a disaster. CBA is described as a systematic approach to compare benefits and costs of alternatives to determine the best allocation of resources. Risk assessment methods involve understanding cost estimating risk, schedule risk, and requirement risk as well as quantifying uncertainties. Monte Carlo simulation is presented as a tool to analyze how uncertainties affect cost estimates.
This document discusses different types of decision making processes. It begins by defining decision making as a 7 step process of identifying problems, gathering information, identifying alternatives, weighing evidence, choosing alternatives, taking action, and reviewing decisions.
It then describes 3 types of decisions - strategic decisions made by senior management that affect the entire organization, tactical decisions made by middle management to meet strategic objectives, and operational decisions made by junior management for day-to-day tasks.
The document also discusses decision making under certainty, uncertainty, and risk. Finally, it contrasts programmed decisions, which follow standard procedures, from non-programmed decisions, which are unique, ill-structured problems requiring judgment and creativity to solve.
Tool & techniques decision making processMae Parcero
This document discusses tools and techniques for decision making. It defines tools as physical items used to achieve goals and techniques as systematic procedures or routines used to accomplish tasks.
It then describes several decision making tools and techniques: nominal group technique, Delphi technique, brainstorming, multivoting, Pareto analysis, fishbone diagrams, and PMI analysis. For each technique it provides a brief explanation of how it works and how it can be used to make decisions.
Finally, it states that when making decisions one should consider both the positives and negatives to avoid losses and allow for sustained growth, but that ultimately decisions must be made and the consequences accepted to remain in control.
This chapter introduces spreadsheet modeling and decision analysis as a field of management science that uses computers, statistics, and mathematics to solve business problems. It discusses how spreadsheet models represent real-world phenomena with mathematical relationships and can help analyze decisions by evaluating potential outcomes. Examples are given of companies that achieved significant cost savings and efficiency gains by developing spreadsheet and other mathematical models to optimize areas like procurement, logistics, inventory management, and operations. The chapter also covers characteristics of models, benefits of modeling approaches, categories of mathematical models, and cognitive biases that can influence decision-making.
Quantitative techniques are statistical and programming methods that help decision makers analyze problems, especially business problems, using quantitative data. They have evolved from early applications in the 19th century to today where they are used widely. They can be classified into statistical techniques, which analyze collected data, and programming techniques, like linear programming, that model relationships to find optimal solutions. Quantitative techniques help businesses with tasks like resource allocation, strategy selection, and decision making. However, they have limitations like not accounting for intangible human factors.
The document discusses process integration and provides tips for establishing harmony between different process areas within a company. It recommends that companies create harmonization between separate teams handling different processes like sales, finance, and warehousing. It suggests controlling "gates" where processes interact, leading with finance as the primary process, using cost structures to ensure integration, visualizing interfaces through maps, and having subject matter experts regularly review integration across areas.
This document discusses managerial decision making and the rational decision making process. It describes how managers are evaluated based on their decisions and the importance of results. The rational decision making process is similar to strategic planning and helps managers evaluate alternatives systematically. While rational decision making aims to find the best solution, it has limitations like not considering all alternatives due to constraints of time, information and uncertainty. The document also outlines the typical steps in a managerial decision making process and how to make a business plan.
Decesion Making Tahir Khan, University Of PeshawarTahir Khan
The document discusses decision making processes and styles. It describes linear thinking which views problems as discrete and unique, versus systems thinking which sees problems as complex and related. There are programmed decisions for routine problems and non-programmed decisions for unique problems. Decision making occurs at strategic, administrative, and operational levels. Manager styles include problem avoiders, problem solvers, and problem seekers. The decision making process involves situational analysis, setting goals, generating alternatives, evaluating consequences, pilot testing, and implementation with feedback.
This document discusses decision-making in engineering management. It covers the following key points:
- Decision-making involves identifying alternative courses of action appropriate to the situation. It is a core management responsibility.
- There are three levels of decision-making - strategic, tactical, and operational - with higher levels making bigger, more complex decisions.
- The decision-making process involves 7 steps: diagnosing the problem, analyzing the environment, developing alternatives, evaluating alternatives, making a choice, implementing the decision, and evaluating/adapting the results.
- Approaches to problem-solving include qualitative and quantitative evaluation. Quantitative models discussed include inventory models, queuing theory, network models, forecasting,
The document outlines the steps in the decision making process as defined by Ponmuthu S. and Daniel R. The 8 step process includes: 1) defining the problem and goals, 2) identifying decision criteria, 3) allocating weights to criteria, 4) gathering alternatives, 5) evaluating alternatives, 6) selecting the best alternative, 7) implementing the alternative, and 8) evaluating the decision's effectiveness. Key aspects of each step are described, such as using decision criteria, assigning weights based on importance, evaluating alternatives based on factors like feasibility and costs, and monitoring the implemented alternative. The overall process is meant to help decision makers systematically analyze problems and select optimal solutions.
This document provides an overview of decision making and management. It defines key terms like programmed and nonprogrammed decisions. It describes the traditional and modern approaches to different types of decisions. It outlines the elements of decision making like the decision makers, goals, alternatives and choice. It presents models of the decision making process and conditions. It introduces tools like probability theory and decision trees. It also discusses group decision making, comparing individual to group processes. Different techniques for group decision making are outlined like brainstorming and the Delphi method.
The document outlines the eight steps of the decision-making process: 1) identifying the problem, 2) identifying decision criteria, 3) allocating weights to criteria, 4) developing alternatives, 5) analyzing alternatives, 6) selecting an alternative, 7) implementing the alternative, and 8) evaluating the decision's effectiveness. It also discusses programmed decisions for structured, recurring problems, and nonprogrammed decisions for unique, unstructured problems that require custom solutions. Exhibits provide examples of applying the decision-making process to choosing a new laptop computer.
Decision making is a fundamental aspect of management that involves choosing between alternative courses of action to achieve desired results. Managers must make decisions to solve problems, and monitor the consequences to determine if further decisions are needed. There are different types of decisions like basic one-time decisions, routine repetitive decisions, programmed structured recurring decisions, and non-programmed unique situation decisions. Decision making can also be classified as personal, organizational, strategic, operational, problem-solving, opportunity-based, structured, unstructured, crisis-based, research-based, initiative, and referred. The typical decision making process involves awareness of a problem, diagnosing and stating the problem, developing alternatives, analyzing alternatives, selecting the best solution, and implementing and
This document discusses the process of organizing as a management function. It defines organizing as dividing work activities into departments and groups, assigning duties, and establishing authority and responsibility. The key steps in organizing are determining objectives, listing activities, grouping activities, determining positions, delegating duties, and establishing relationships between positions. Organizing establishes the formal organizational structure through departments, charts, and allocation of authority. Informal organization also occurs naturally through social groups.
There are several types of managerial decisions including:
Programmed decisions which follow set procedures and non-programmed decisions which deal with unusual problems.
Major decisions involve large expenditures while minor decisions involve small routine purchases.
Routine decisions are repetitive and operational, while strategic decisions are long-term policy matters that require careful analysis.
Organizational decisions reflect company policy while personal decisions cannot be delegated.
Individual decisions are made alone following guidelines, and group decisions are made by committees on important matters.
Policy decisions set long-term direction while operational decisions manage daily operations.
Long-term decisions carry more risk, departmental decisions impact a single group, and non-economic decisions consider technical and moral
Organizational Planning And Goal Setting MGT 201 Helpful Slides For Management Students Of Different Universities In Karachi And All Over Pakistan And World
The document discusses quantitative analysis and decision making in management science, outlining the 7 steps of problem solving, uses of quantitative analysis, how to develop mathematical models, and providing an example of how management science could be used to model and solve a project scheduling problem to minimize completion time. Key aspects of models include objective functions, constraints, decision variables, and whether models are deterministic or stochastic.
The document discusses different models and approaches to decision making. It describes the economic man model which involves fully rational decision making to maximize returns. However, it also introduces the administrative man model which recognizes that in reality, managers have bounded rationality due to limitations of time, information, and skills. The document also outlines different types of decisions like programmed vs non-programmed and strategic vs tactical vs operating decisions. Finally, it lists some typical steps involved in the decision making process.
1) The document discusses tools and techniques for managerial decision making. It explains that decision making is a process that involves multiple steps: establishing objectives, identifying alternatives, evaluating alternatives, selecting the best option, implementing, and monitoring performance.
2) Several economic tools are described that can help managers in decision making, including opportunity cost, incremental principle, time perspective principle, discounting principle, and equi-marginal principle. These tools help managers evaluate costs and revenues of different alternatives.
3) Managerial decision making is influenced not just by economics but also human/behavioral factors, technology, and the external environment. A variety of concepts from economic theory can assist managers in analyzing problems and making informed choices.
This document discusses various aspects of decision theory including models of decision making, decision trees, decision styles, decision theories, group decision making, and improving decision making. It describes the classical, implicit favorite, and intuitive models of decision making. It also outlines four decision styles - directive, analytical, conceptual, and behavioral. Two major decision theories - classical and behavioral - are explained along with their key aspects. Methods for improving individual and group decision making are also provided.
Business impact analysis and Cost-benefit Analysis. Risk Assesmenterfan7486
This document discusses business impact analysis (BIA), cost/benefit analysis (CBA), and risk assessment methods. It defines BIA as identifying key business areas, critical functions, acceptable downtime, and dependencies to understand potential impacts of a disaster. CBA is described as a systematic approach to compare benefits and costs of alternatives to determine the best allocation of resources. Risk assessment methods involve understanding cost estimating risk, schedule risk, and requirement risk as well as quantifying uncertainties. Monte Carlo simulation is presented as a tool to analyze how uncertainties affect cost estimates.
This document discusses different types of decision making processes. It begins by defining decision making as a 7 step process of identifying problems, gathering information, identifying alternatives, weighing evidence, choosing alternatives, taking action, and reviewing decisions.
It then describes 3 types of decisions - strategic decisions made by senior management that affect the entire organization, tactical decisions made by middle management to meet strategic objectives, and operational decisions made by junior management for day-to-day tasks.
The document also discusses decision making under certainty, uncertainty, and risk. Finally, it contrasts programmed decisions, which follow standard procedures, from non-programmed decisions, which are unique, ill-structured problems requiring judgment and creativity to solve.
Tool & techniques decision making processMae Parcero
This document discusses tools and techniques for decision making. It defines tools as physical items used to achieve goals and techniques as systematic procedures or routines used to accomplish tasks.
It then describes several decision making tools and techniques: nominal group technique, Delphi technique, brainstorming, multivoting, Pareto analysis, fishbone diagrams, and PMI analysis. For each technique it provides a brief explanation of how it works and how it can be used to make decisions.
Finally, it states that when making decisions one should consider both the positives and negatives to avoid losses and allow for sustained growth, but that ultimately decisions must be made and the consequences accepted to remain in control.
This chapter introduces spreadsheet modeling and decision analysis as a field of management science that uses computers, statistics, and mathematics to solve business problems. It discusses how spreadsheet models represent real-world phenomena with mathematical relationships and can help analyze decisions by evaluating potential outcomes. Examples are given of companies that achieved significant cost savings and efficiency gains by developing spreadsheet and other mathematical models to optimize areas like procurement, logistics, inventory management, and operations. The chapter also covers characteristics of models, benefits of modeling approaches, categories of mathematical models, and cognitive biases that can influence decision-making.
Quantitative techniques are statistical and programming methods that help decision makers analyze problems, especially business problems, using quantitative data. They have evolved from early applications in the 19th century to today where they are used widely. They can be classified into statistical techniques, which analyze collected data, and programming techniques, like linear programming, that model relationships to find optimal solutions. Quantitative techniques help businesses with tasks like resource allocation, strategy selection, and decision making. However, they have limitations like not accounting for intangible human factors.
The document discusses process integration and provides tips for establishing harmony between different process areas within a company. It recommends that companies create harmonization between separate teams handling different processes like sales, finance, and warehousing. It suggests controlling "gates" where processes interact, leading with finance as the primary process, using cost structures to ensure integration, visualizing interfaces through maps, and having subject matter experts regularly review integration across areas.
This document discusses managerial decision making and the rational decision making process. It describes how managers are evaluated based on their decisions and the importance of results. The rational decision making process is similar to strategic planning and helps managers evaluate alternatives systematically. While rational decision making aims to find the best solution, it has limitations like not considering all alternatives due to constraints of time, information and uncertainty. The document also outlines the typical steps in a managerial decision making process and how to make a business plan.
Decesion Making Tahir Khan, University Of PeshawarTahir Khan
The document discusses decision making processes and styles. It describes linear thinking which views problems as discrete and unique, versus systems thinking which sees problems as complex and related. There are programmed decisions for routine problems and non-programmed decisions for unique problems. Decision making occurs at strategic, administrative, and operational levels. Manager styles include problem avoiders, problem solvers, and problem seekers. The decision making process involves situational analysis, setting goals, generating alternatives, evaluating consequences, pilot testing, and implementation with feedback.
This document discusses decision-making in engineering management. It covers the following key points:
- Decision-making involves identifying alternative courses of action appropriate to the situation. It is a core management responsibility.
- There are three levels of decision-making - strategic, tactical, and operational - with higher levels making bigger, more complex decisions.
- The decision-making process involves 7 steps: diagnosing the problem, analyzing the environment, developing alternatives, evaluating alternatives, making a choice, implementing the decision, and evaluating/adapting the results.
- Approaches to problem-solving include qualitative and quantitative evaluation. Quantitative models discussed include inventory models, queuing theory, network models, forecasting,
The document outlines the steps in the decision making process as defined by Ponmuthu S. and Daniel R. The 8 step process includes: 1) defining the problem and goals, 2) identifying decision criteria, 3) allocating weights to criteria, 4) gathering alternatives, 5) evaluating alternatives, 6) selecting the best alternative, 7) implementing the alternative, and 8) evaluating the decision's effectiveness. Key aspects of each step are described, such as using decision criteria, assigning weights based on importance, evaluating alternatives based on factors like feasibility and costs, and monitoring the implemented alternative. The overall process is meant to help decision makers systematically analyze problems and select optimal solutions.
This document provides an overview of decision making and management. It defines key terms like programmed and nonprogrammed decisions. It describes the traditional and modern approaches to different types of decisions. It outlines the elements of decision making like the decision makers, goals, alternatives and choice. It presents models of the decision making process and conditions. It introduces tools like probability theory and decision trees. It also discusses group decision making, comparing individual to group processes. Different techniques for group decision making are outlined like brainstorming and the Delphi method.
The document outlines the eight steps of the decision-making process: 1) identifying the problem, 2) identifying decision criteria, 3) allocating weights to criteria, 4) developing alternatives, 5) analyzing alternatives, 6) selecting an alternative, 7) implementing the alternative, and 8) evaluating the decision's effectiveness. It also discusses programmed decisions for structured, recurring problems, and nonprogrammed decisions for unique, unstructured problems that require custom solutions. Exhibits provide examples of applying the decision-making process to choosing a new laptop computer.
Decision making is a fundamental aspect of management that involves choosing between alternative courses of action to achieve desired results. Managers must make decisions to solve problems, and monitor the consequences to determine if further decisions are needed. There are different types of decisions like basic one-time decisions, routine repetitive decisions, programmed structured recurring decisions, and non-programmed unique situation decisions. Decision making can also be classified as personal, organizational, strategic, operational, problem-solving, opportunity-based, structured, unstructured, crisis-based, research-based, initiative, and referred. The typical decision making process involves awareness of a problem, diagnosing and stating the problem, developing alternatives, analyzing alternatives, selecting the best solution, and implementing and
This document discusses the process of organizing as a management function. It defines organizing as dividing work activities into departments and groups, assigning duties, and establishing authority and responsibility. The key steps in organizing are determining objectives, listing activities, grouping activities, determining positions, delegating duties, and establishing relationships between positions. Organizing establishes the formal organizational structure through departments, charts, and allocation of authority. Informal organization also occurs naturally through social groups.
This document provides definitions of economics from different perspectives and outlines the basic concepts and principles of managerial economics. It discusses how economics can be viewed as both a science and an art. Microeconomics studies individual actors like firms and households while macroeconomics looks at aggregates. Managerial economics applies economic theory to business decision making under uncertainty. It helps address resource allocation, inventory, pricing, and investment problems. Managerial economics is related to other fields like operations research, decision theory, statistics, and accounting.
This document provides an overview of engineering economics and financial accounting presented by Dr. K. Baranidharan. It defines key concepts in economics like economic and non-economic activities. It also describes different types of economic systems including capitalist, mixed and free market economies. The document then focuses on managerial economics, defining it, discussing its nature and significance. It outlines the objectives and scope of managerial economics and describes its relationships with other disciplines like operations research, mathematics, statistics, and accountancy.
This document provides an introduction to an engineering economics course. It outlines the course topics which include engineering estimation, interest and equivalence, present worth analysis, rate of return analysis, and uncertainty and risk. It discusses key concepts like the time value of money and decision making processes. It also introduces microeconomics, macroeconomics, and fundamental business structures. The overall purpose is to provide students an overview of the engineering economics discipline and what will be covered in the course.
This document outlines and defines different types of decisions that may be made within an organization. It discusses programmed versus non-programmed decisions, major versus minor decisions, operative versus personal decisions, group versus departmental decisions, economic versus non-economic decisions, crisis versus problem decisions, and certainty versus uncertainty decisions. Key factors that define each type of decision, such as level of structure, frequency, impact, decision makers involved, and information available, are provided.
The document provides an introduction to engineering economics. It defines economics and engineering economics, noting that engineering economics deals with the analysis and evaluation of factors that will affect the economic success of engineering projects. It discusses key concepts from economics used in engineering economics, such as scarcity, opportunity cost, demand and supply. It also outlines the basic guidelines for engineering economic analysis, including developing alternatives, focusing on differences among alternatives, using consistent and common units of measurement, and considering uncertainty. The document emphasizes that engineering economics is important for engineering decision-making involving questions about project priorities, designs, and economic worth.
The document provides an overview of key concepts in engineering economics and managerial economics including efficiency, demand and elasticity, supply, indifference curves, and consumer equilibrium. It discusses the different types of efficiency (engineering, technical, economic), determinants of demand, elasticity of demand, supply and the law of supply, indifference curves and their properties, budget constraints, and how consumer equilibrium is reached at the point where the marginal rate of substitution equals the price ratio.
This document summarizes key concepts related to demand and supply analysis. It defines demand as how much of a good consumers are willing and able to buy at different prices, and supply as how much producers are willing and able to offer for sale. It describes the laws of demand and supply - that demand curves slope downward and supply curves slope upward. It discusses factors that can cause shifts in demand or supply curves and changes in equilibrium price and quantity. These include income, prices of related goods, technology, and expectations. The document also explains the effects of price floors and ceilings in creating surpluses or shortages.
The document discusses the concepts of supply and demand in competitive markets. It examines what determines demand and supply for a good, how supply and demand interact to set market price and quantity, and how prices allocate scarce resources. Key factors that influence demand include price, income, prices of substitutes and complements. Supply is influenced by price, costs of inputs, technology and number of sellers. Market equilibrium occurs when quantity demanded equals quantity supplied. The equilibrium price clears the market.
This chapter discusses organizing as the process of grouping people and tasks to achieve goals. It defines organizing and examines it as a process. The chapter also covers types of organization structures like line, line and staff, and functional. It discusses organization charts, departmentation, centralization vs decentralization, and the relationships between line and staff. The key goals of organizing are establishing responsibility, communication, and performance measurement.
Engineering economics deals with evaluating the costs and benefits of engineering projects over time. It uses time value of money concepts like present and future value to analyze cash flows. Cash flows are summarized in diagrams with costs below and benefits above the time line. Equivalence techniques convert cash flows to a common point in time to compare project alternatives. Present worth analysis discounts all cash flows to the present using a discount rate to determine the net present value of projects.
This document discusses engineering economics and provides an overview of key concepts. It introduces engineering economics as the application of economic analysis to engineering decision making. It explains that engineers must consider economics as most organizations aim to make money now and in the future. The document also outlines several principles of engineering economics, such as the time value of money and comparing alternatives based on their differences. Finally, it presents the typical seven step process for engineering economic analysis.
This document provides an introduction and syllabus for an engineering economics course taught by Dr. Mohsin Siddique. It outlines the course details including the instructor's contact information, course goals and objectives, topics to be covered, assessment criteria, textbook information, and tentative schedule. The course aims to provide engineering students with the basic concepts of engineering economics to aid in decision making for engineering projects. Key topics include cost estimation, interest calculation, present worth analysis, rate of return analysis, and depreciation. Students will be assessed through quizzes, exams, assignments, and a final exam.
The document discusses different aspects of organizing, including definitions, types of organization structures, factors determining span of management, and departmentation. It defines organizing as the systematic arrangement of activities and grouping of tasks to achieve objectives. Different organization structures discussed include line, staff, functional, committee, project, and matrix structures. Factors like nature of work, technology, and manager's ability influence the span of management. Departmentation can be done by functions, products, territory, customers, process, and time.
Nature of organizing , formal and informal organizationPranav Kumar Ojha
The document discusses the nature of organizing. It defines organizing as identifying and grouping work, delegating responsibility and authority, and establishing relationships to enable effective teamwork. It describes the importance of organizing for specialization, clear relationships, optimal resource use, and adaptation. Organizing involves dividing work into jobs and departments, assigning tasks, and establishing individual, group and department relationships. Formal organizing is deliberately designed with clear roles, while informal organizing spontaneously arises from personal interactions.
This document discusses the fundamentals of organizing, including its nature, importance, and process. It defines organizing as identifying and grouping work to be performed, defining responsibilities, and establishing relationships to enable efficient work. Organizing involves differentiating and integrating units through specialized tasks and coordination. An effective organization has groups working toward common objectives through divided work and cooperation, with central authority, communication, rules, and a dynamic structure. Organizing is important as it facilitates administration, encourages growth and innovation, optimizes technology use, and ensures continuity through coordination. The process of organizing involves identifying activities, grouping them, assigning duties, and delegating appropriate authority.
The document discusses the concepts of organizing, including defining organizing as the process of arranging work, authority, and resources to achieve organizational goals. It covers principles of organization like unity of command and span of control, and different types of organizational structures such as functional, divisional, and matrix structures. The document also examines concepts related to organizing like responsibility, authority, and centralization versus decentralization.
Managerial decision making involves responding to opportunities and threats by analyzing options and choosing courses of action. There are two types of decisions - programmed decisions which are routine, and non-programmed decisions which are unusual situations with no set rules. The classical model assumes all information is available, but the administrative model recognizes information is often incomplete. Effective decision making involves framing the problem, generating alternatives, evaluating alternatives, choosing an alternative, implementing it, and learning from feedback. Group decision making can reduce biases but risks groupthink; techniques like devil's advocacy and diversity can improve it. Organizational learning and creativity help decision making by challenging assumptions and encouraging new ideas.
The document discusses various aspects of decision making. It defines decision making as choosing one alternative from among options. It describes the decision making process as recognizing the need for a decision, identifying alternatives, choosing the best option, and implementing it. Decision making can occur under certainty, risk, or uncertainty. Rational models of decision making propose a logical, step-by-step process while behavioral models recognize limitations and biases that influence decisions. Political forces, intuition, escalation of commitment, risk tolerance, and ethics also shape organizational decision making.
Similar to Types of managerial decision - ENGINEERING ECONOMICS & FINANCIAL ACCOUNTING - DR.K.BARANIDHARAN, SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI
This document provides an overview of decision making. It begins with objectives of understanding decision making processes and styles. It then describes the problem finding process, including defining the problem, visualizing it, and brainstorming requirements. It discusses opportunity finding. The fundamentals of the decision making process are introduced, including common steps. Managerial decision making is examined, distinguishing between programmed and non-programmed decisions. Factors like certainty, risk, and uncertainty are also covered.
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Types of managerial decision - ENGINEERING ECONOMICS & FINANCIAL ACCOUNTING - DR.K.BARANIDHARAN, SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI
1.
2. Prepared by :
Dr. K. BARANIDHARAN
PROF.MBA
SRI SAIRAM INSTITUTE OF TECHNOLOGY
CHENNAI
ENGINEERING ECONOMICS
AND
FINANCIAL ACCOUNTING
Sri Sairam Institute of Technology 2
6. Basic
• Basic decisions are those which are unique,
one-time decisions involving long-range
commitments of relative permanence or
duration, or those involving large investments.
• Examples of basic decisions in a business firm
include plant location, organization structure,
wage negotiations, product line, etc. In other
words, most top management policy decisions
can be considered as basic decisions.
7. Routine
• Routine decisions are at the opposite extreme from basic
decisions. They are the everyday, highly repetitive,
management decisions which by themselves have little
impact on the overall organization. However, taken together,
routine decisions play a tremendously important role in the
success of an organization.
• Examples of, routine' decisions are an accountant's decision
on a new entry, a production supervisor’s decision to
appoint a new worker, and a salesperson's decision on what
territory to cover. Obviously, a very large proportion of the
decisions made in an organization are of the routine variety.
However, the exact proportion of basic to routine types
depends on the level of the organization which the decisions
are made.
8. . Programmed and Non-programmed
Decisions
• programmed Decisions
The difference between Programmed (routine,
repetitive) decisions and Non-programmed (unique,
one-shot) decisions.
• While programmed decisions are typically handled
through structured or bureaucratic techniques
(standard operating procedures),
• non-programmed decisions must be made by managers
using available information and their own judgement.
As is often the case with managers, however, decisions
are made under the pressure of time.
9. Mechanistic
• If a decision is a routine and repetitive in nature
it is called mechanistic decision.
• The number of variables in decision making are
relatively limited.
• There are clear cut alternative for taking
mechanistic decisions and each alternative has
a well defined outcome.
• Example: if I know how many computers gets
sold in a computer exhibition (from my
experience, I have been participating in the
Industrial exhibition for the last….
10. Analytical
• Complex nature, they have large number of
variables.
• But the outcome of each alternative can be
computed.
• The problem pertain to engineering, production,
maintenance, project management, fall under this
category.
• These are complex in nature Yet, they can be solved.
• OR and Management Science provide an array of
tools and techniques such as linear programming,
inventory models, queuing theory, PERT/CPM to
determine optimal solutions.
11. Judgemental
• Limited number of decision variable
and each decision alternatives has
unknown outcomes, it is called a
judgemental decision.
• Manager take judgemental decisions
while dealing with problems in most of
the functional areas of management
such a personnel, marketing,
production, R&D etc
12. Adaptive
• There are large number of decisions
variables with lot of uncertainty over the
outcomes, it is a case of adaptive decision.
• Even managers find it difficult to reach a
consensus on decision strategies.
• Such decisions cannot be structured for
easy solutions.
• Managers of diverse technical skills are
normally required to handle such decisions.
13. 13
Certainty, Risk, Uncertainty, Ambiguity
● Certainty
● all the information the decision maker needs is fully available
● Risk
● decision has clear-cut goals
● good information is available
● future outcomes associated with each alternative are subject to
chance
● Uncertainty
● managers know which goals they wish to achieve
● information about alternatives and future events is incomplete
● managers may have to come up with creative approaches to
alternatives
● Ambiguity
● by far the most difficult decision situation
● goals to be achieved or the problem to be solved is unclear
● alternatives are difficult to define
● information about outcomes is unavailable