Decision making by salman ii
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The document discusses decision making and provides details on: - Types of decisions including programmed and nonprogrammed decisions. - Models of decision making such as the classical and administrative approaches. - The five step decision making process of defining the problem, clarifying objectives, identifying alternatives, analyzing consequences, and making a choice. - Additional tips for making better decisions including increasing knowledge, using intuition, weighing pros and cons, and ensuring proper timing. - The use of decision matrices and tools like brainstorming to aid the decision making process.
Decision making by salman ii
- 1. Decision Making Group Members M ZESHAN SAFDAR M USMAN KHAN SALMAN KHALID ADNAN MALIK ZAHID UR REHMAN
- 2. Points to be covered • Types of decisions • Models of decision making • The decision making process • Creativity
- 3. Understanding Decision Making • Decision • A choice made between available alternatives. • Decision Making • The process of developing and analyzing alternatives and choosing from among them. • Judgment • The cognitive, or “thinking,” aspects of the decision- making process.
- 4. Types of Decisions • Programmed Decision • A decision that is repetitive and routine and can be made by using a definite, systematic procedure. • Nonprogrammed Decision • A decision that is unique and novel. • The Principle of Exception • “Only bring exceptions to the way things should be to the manager’s attention. Handle routine matters yourself.” Programmed Decisions Nonprogrammed Decisions
- 5. Decision-Making Models • The Classical Approach • Have complete or “perfect” information about the situation. • Distinguish perfectly between the problem and its symptoms. • Identify all criteria and accurately weigh all the criteria according to preferences. • Accurately calculate and choose the alternative with the highest perceived value. The problem is clear and unambiguous A single, well- defined goal is to be achieved All alternatives and consequences are known Preferences are clear Preferences are constant and stable No time or cost constraints exist Final choice will maximize economic payoff
- 6. Decision-Making Models • The Administrative Approach • Bounded Rationality (Herbert Simon) • The boundaries on rational decision making imposed by one’s values, abilities, and limited capacity for processing information. • Satisfice • To stop the decision-making process when satisfactory alternatives are found.
- 7. The Decision-Making Process Define the problem. Clarify your objectives. Identify alternatives. Analyze the consequences. Make a choice.
- 8. Step 1. Define the Problem 1. Start by writing down your initial assessment of the problem. 2. Dissect the problem. • What triggered this problem (as I’ve assessed it)? • Why am I even thinking about solving this problem? • What is the connection between the trigger and the problem?
- 9. Step 2. Clarify Your Objectives 1. Write down all the concerns you hope to address through your decision. 2. Convert your concerns into specific, concrete objectives. 3. Separate ends from means to establish your fundamental objectives. 4. Clarify what you mean by each objective. 5. Test your objectives to see if they capture your interests.
- 10. Step 3. Identify Alternatives 1. Generate as many alternatives as you can yourself. 2. Expand your search, by checking with other people, including experts. 3. Look at each of your objectives and ask, “how?” 4. Know when to stop.
- 11. Step 4. Analyze the Consequences 1. Mentally put yourself into the future. • Process Analysis • Solving problems by thinking through the process involved from beginning to end, imagining, at each step, what actually would happen. 1. Eliminate any clearly inferior alternatives. 2. Organize your remaining alternatives into a table (matrix) that provides a concise, bird's-eye view of the consequences of pursuing each alternative.
- 12. Step 5. Make a Choice • Analyses are useless unless the right choice is made. • Under perfect conditions, simply review the consequences of each alternative, and choose the alternative that maximizes benefits. • In practice, making a decision—even a relatively simple one like choosing a computer—usually can’t be done so accurately or rationally.
- 13. How To Make Better Decisions 1. Increase Your Knowledge • Ask questions. • Get experience. • Use consultants. • Do your research. • Force yourself to recognize the facts when you see them (maintain your objectivity). 1. Use Your Intuition • A cognitive process whereby a person instinctively makes a decision based on his or her accumulated knowledge and experience.
- 14. How To Make Better Decisions (cont’d) 3. Weigh the Pros and Cons • Quantify realities by sizing up your options, and taking into consideration the relative importance of each of your objectives. 3. Don’t Overstress the Finality of Your Decision • Remember that few decisions are forever. • Knowing when to quit is sometimes the smartest thing a manager can do. 3. Make Sure the Timing Is Right
- 15. Decision Matrix • Use weights to provide adjustments for importance of criteria • Often subjective, but helps to prioritize
- 16. Creativity and Decision Making • Creativity • The process of developing original, novel responses to a problem. • Brainstorming • A creativity-stimulating technique in which prior judgments and criticisms are specifically forbidden from being expressed in order to encourage the free flow of ideas which are encouraged. Creativity Task motivation Creativity skillsExpertise