Decision Ma Kin

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Decision Making

Phases of Decision Making Simons

Model

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Decision Making

Decision making is a process of choosing among

alternative courses of action for the purpose

of attaining a goal or goals.

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Decision-making is a dynamic process. It is

complex and at times ambiguous.

Decision-makers encounter problems when

searching for information and they may work

with delayed feedback of results, uncertainty,

ambiguity and sometimes conflict.

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Why are Decisions Made?

Decisions are made to solve problems or take

advantage of opportunities.

Decisions are made when it is perceived thatsomething needs to be done.

Decisions should be timely.

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Problem-solving model

SenseGather data

ListenExamine

Problem (Re) Definition

Question

Finding ideas

Finding and evaluating Solutions

Implement and evaluate solution

(Maybe prototype a solution).


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Analysing the Decision

Structured vs unstructured

At a particular management level

Operational (short term) Tactical(medium term)

Strategic (Long term)

Routine and recurring vs infrequent

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Structured

The procedures forfinding the best solution

exist.

Routine and repetitive.

Situation fullyunderstood.

e.g. select the product mix to

obtain the maximum profit

given labour and budgetaryconstraints. (goal

programming)

Travelling salesman problem.

Unstructured

Necessary information may

not be available.

Objectives are hard to

quantify and identify

Difficult to develop a model

of the situation.Creative Decision.

One-shot.

Focus of computersystems ison information presentation,

summary and support analyses

and collaboration rather than on

finding an optimal solution.


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The Decision Making Process

(Simons model)

Intelligence

Identify a problem or opportunity.

Design Find and analyse possible courses of action.

Choice

Decide which action to take.

Implementation Acting on the decision

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Intelligence

Examine the environment to

identify problem situations or

opportunities.

Intelligence can be further divided

into

Detection

Definition

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Intelligence

1. Problem Identification/detection

2. Problem Classification - try and place problem indefinable category.

Programmed Problems- well structured problems forwhich models have been developed.

Nonprogrammed Problems- novel and nonrecurrent

3. Problem Decomposition divide problem into

subproblems4. Problem Ownership

Formal problem

statement


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Problem identification/Detection

May start with a gut feeling that something iswrong or that there is an opportunity.

Stimuli

Internal performance measures E.g. tax intake below budget.

Client reaction

E.g. complaints from patients in the health service.

Other stakeholders

E.g.

External factors

Changes from the external environment.

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Measuring and Monitoring

What might you need to keep an eye on to

know if there is a problem?

Within the organisation

Outside the organisation

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System Control

Information from the system itself:

Feedback (positive, negative)

Feedforward

Information from the environment

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Definition

Once you are aware of a problem or

opportunity need to define it.

Is it a problem or a symptom?

Is it within your scope?

Who should be responsible?

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Problem or Symptom

Need to look beyond the initial problemdescription to see what lies behind it.

Symptom can have many different causes.

Fixing the wrong cause will not cure the symptom.

This can involve the collection of largeamounts of data.

Keep asking why? May not always be possible to get the

information you want.

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Examples

Write down as many causes as you can think of :

Staff turnover is too high.

Exam results are too low

You are using too many lightbulbs.

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Problem Ownership

Who owns these problems?

Climate change.

Oil is a finite resource and the price will probably

go up in the next couple of years.

Interest rates will most likely go up in 2012

The standard of third level education is declining

Describing the problem in terms that you havecontrol over is key.

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Who Should Decide

The broader the scope of the problem thehigher the level of management involvementin the decision making process.

When discussing problems it is important thatsomeone or some group is assignedresponsibility.

The person needs to be at an appropriatelevel.

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Design

Design is the part of the process where both

the possible alternatives and the criteria for

comparing them are identified.

Identify alternatives.

Determine which ones deserve analysis and

analyse them.

Can create models to analyse the alternatives(normative or descriptive).

Decide how the choice will be made.

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Identify Alternatives

Can be a creative process.

Brainstorming can be useful.

Models can be used to predict the outcome of

alternatives

Factors: certainty, risk, uncertainty

Scenarios -worst case, best case

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Criteria for Decision

Before making the choice it is a good idea to

decide what the criteria for choosing should

be.

What are the goals, objectives.

What importance is attached to each objective.

Are you looking for the best solution or a

satisfying one (good enough).

What level of risk is acceptable.

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Group Decision Making

Where groups are making a decision choosing

the criteria first can ease the decision making

process.

Get agreement on criteria.

Rank alternatives.

Decision is made.

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Choice

Here the actual decision is made.

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Is your problem solved ?

Intelligence

Design

Choice

Implementation:

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} Decision MakingProblem

Solving


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Implementation

Problem is not solved until the decision is

implemented.

Implementation can sometimes be the mostdifficult phase of all.

Sometimes a good decision can lead to a poor

outcome.

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Summary

Intelligence

Problem versus Symptom

Assign ownership.

Design

Identify Alternatives

Decide on the criteria

Choice

Make the choice.

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Decision Ma Kin

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