Download - 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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