decision making proccess.

8/7/2019 decision making proccess.

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DECISION

MAKING ,PRESENTED BY:

HUMA ANSARI.

KRITIKA RAI.

KUSHWAHA KANT.

LAKSH MAHESHWARI

LALIT DAMOR.

SONIA ISRANI.


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the process of responding to a problem

by searching for and selecting a solutionor course of action that will create value

for organisational stakeholders.


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Certainty

* A situation in which a manager can make

an accurate decision because theoutcome of every alternative choice isknown.

Risk

* A situation in which the manager is ableto estimate the likelihood (probability) ofoutcomes that result from the choice ofparticular alternatives.


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THE RATIONAL DECISION MAKING PROCESS.

ASSUMPTIONS OF THE MODEL.1. PROBLEM CLARITY.

2. KNOWN OPTIONS.

3. CLEAR PREFERENCES.

4. CONSTANT PREFERENCES.

5. NO TIME / COST CONSTRAINTS.

6. MAXIMUM PAYOFF.


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COMMON BIASES AND ERRORS.

BOUNDED RATIONALITY.

INTUTION.

INDIVIDUAL DIFFERENCES.

ORGANISATIONAL CONSTRAINTS.

CULTURE DIFFERENCE.


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Individuals make decisions by constructing

simplified models that extracts the essential

features from problems without capturing all

their complexity.


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Intuitive decision making

* Making decisions on the basis of

experience, feelings, and accumulatedjudgment.


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DECISION STYLES .

GENDER.


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PERFORMANCE EVALUATION.

REWARD SYSTEM.

FORMAL REGULATION.

SYSTEM IMPOSED TIME CONSTRAINTS.

HISTORICAL PRECEDENTS.


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The rational model makes no acknowledgment

of cultural differences.


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The Decision-

Making Process

Define the

Problem

Evaluate

Alternatives

Implement

the chosen

Alternative

Gather facts and

develop

alternatives.

Select the best

alternative.

Follow up and

evaluate the chosen

alternative.


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Identify a problem and decision criteria and

allocating weights to the criteria.

Developing, analyzing, and selecting an

alternative that can resolve the problem.

Implemented and selected alternatives.

Evaluating the decisions effectiveness.


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Problem

* A discrepancy between an existing anddesired state of affairs.

Characteristics of Problems* A problem becomes a problem when amanager becomes aware of it.

* there is a pressure to solve the problem.

* the manager must have the authority,information, or resources needed to solvethe problem.


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Decision criteria are factors that arerelevant to resolving the problem.

* Costs that will be incurred (investment

required).* Risks likely to be encountered ( chance offailure).

* Outcomes that are desired ( growth of thefirm).


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Decision criteria are not of equal

importance:

* Assigning a weight to each item.

* Places the items in the correct priorityorder of their importance in the decision

making process.


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Decision criteria are not of equal

importance:

* Assigning a weight to each item.

* Places the items in the correct priorityorder of their importance in the decision

making process.


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Identifying viable alternatives.

* Alternatives are listed ( without evaluation)that can resolve the problem.

Step 5 :Analyzing alternatives Appraising each alternatives strengths and

weaknesses

* An alternatives appraisal is based on its

ability to resolve the issues identified in step2 and step 3.


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Choosing the best alternative

* The alternative with the highest total weight ischosen.

Step 7: Implementing the

AlternativePutting the decision to and gaining comment

from those whose will carry out the decision.


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The soundness of the decision is judged by its

outcomes.

* How effectively was the problem resolved by

outcomes resulting from the chosenalternatives?

* if the problem was not resolve, what went

wrong?


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It focuses on what is important

It is logical and consistent.

It acknowledges both subjective and

objective thinking and blends analytical withintuitive thinking.

It requires only as much information andanalysis as is necessary to resolve aparticular dilemma.

It encourages and guides the gathering ofrelevant information and informed opinion.

It is straightforward,reliable, easy to use,and flexible.


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Brainstorming idea generation for decision making.

Nominal group technique (NGT)-problem outlined,presentation of solution in written form, discussion over

written solutions, and final decision.

Delphi technique- decision made on the basis ofquestionnaire filled by the respondents.

Consensus mapping- decision made on the basis of thereport presented by the representative of each group after


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Group versus individual.

A general belief that group decisions are

better than individual decisions.


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Generates more complete information andknowledge.

Offer increased diversity of views.

Generates higher quality decisions.

Increased acceptence of a solution.


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Time consumingThere are conformity pressures in groups.

Decisions can be dominated by one or a few

members.

Ambiguous responsibility.


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Groupthink

y Phenomenon in which the norm for

consensus overrides the realistic appraisal

of alternative courses of action.Groupshift

y A change in decision risk between the

groups decision and the individual

decision that members within the groupwould make; can be either toward

conservatism or greater risk.


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A GROUP has two or more individuals,interacting andinterdependent,who have come together to achieveparticular objectives team is also a group but thereare differences between both.

A group interacts primarily to share information andto make decisions to help each member performwithin his or her area.

No need to engage in collective work .

Performance is merely the summation of each groupmembers individual contribution.

Whereas

In a TEAM coordinated efforts are needed.

Individual efforts results in a performance that isgreater than the sum of the individual inputs.


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Groups Teams

Share

information

Neutral

Individual

Random and

varied

Collectiveperformance

Positive

Individual and

mutual

Complementary

Goal

Synergy

Accountability

Skills


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Team effectiveness can be measured on the

basis of teams productivity, managers

ratings of the teams performance, and

aggregate measures of member satisfaction.


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Context

Adequate resources

Leadership and structure

Climate of trust

Performance evoluation and

reward systems

Composition

Abilities of members

Personality

Allocating rolesDiversity

Size of teamsMember flexibility

Member preferences

Work design

Autonomy

Skill varietyTask identityTask significance

Process

Common purposeSpecific goals

Team efficacyConflict levels

Social loafing

Team effectiveness


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decision making proccess.

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