PowerPoint Presentation by Charlie Cook

Planning
Gary Dessler
Principles and Practices for Tomorrows Leaders
Decision Making
2
CHAPTER
Instructor: Dr. Kang Sovannara
Instructor: Dr. Kang Sovannara 32
Understanding Decision Making
Decision
A choice made between available alternatives.
Decision Making
The process of developing and analyzing
alternatives and choosing from among them.
Problem
A discrepancy between a desirable and an actual
situation.

Instructor: Dr. Kang Sovannara 33 33
Decisions and the Management Functions
Planning
Organizing
Leading
Controlling
What are the organizations long-term objectives?
What strategies will best achieve the objectives?
What should the short-term objectives be?
How many subordinates should report to me?
How much centralization is appropriate?
How should jobs be designed?
How should employees be motivated?
What is the most effective leadership style?
When should conflict be stimulated?
What organizational activities should be controlled?
When is a performance deviation significant?
What is the best management information system?
Management
Function
Typical Decisions Managers Face
Instructor: Dr. Kang Sovannara 34 34
Decisions Business-Team Managers Make
Accounting Manger
Finance Manager
HR Manager
Production Manager
Sales Manager
What accounting firm should we use?
Who should process payroll?
What bank should we use?
Should we sell bonds or stock?
Where should we recruit for employees?
Should we set up a testing program?
Which supplier should we use?
Should we build a new plant?
Which sales rep should we use in this area?
Should we start this advertising campaign?
Manager Examples of Decisions These Managers Face
Instructor: Dr. Kang Sovannara 35
Characteristics of management decision making
Programmability
Uncertainty
Risk
Conflict
Decision Scope
Instructor: Dr. Kang Sovannara 36
Programmed Decision Making
Classification
Nature
Strategy
Situation
Techniques
Routine, Generic, Programmable
Predictable, Well-Defined
Rules and Computations
Relatively Unchanging
Decision Science, Capital Budgets
Instructor: Dr. Kang Sovannara 37
Non-Programmed Decision Making
Classification
Nature
Strategy
Situation
Unique, Innovative, Unpredictable
Unstructured, Ambiguous
Principles or Judgment
Rapidly Changing and Evolving
Intuition or Creativity Techniques
Instructor: Dr. Kang Sovannara 38 38
The Decision-Making Process
Identification
of a
Problem
Identification
of Decision
Criteria
Allocation
of Weights
to Criteria
Price
Brand Name and Model
Warranties and Support
Reliability
Repair Record
Reliability
Brand Name and Model
Warranties and Support
Repair Record
Price
100
85
70
25
10
I need a new
computer.
Instructor: Dr. Kang Sovannara 39 39
Development
of
Alternatives
Analysis
of
Alternatives
Apple
AST
DEC
Gateway
IBM
Micron
Dell
Selection
of an
Alternative
Implementation
of the
Alternative
Evaluation of
Decision Effectiveness
Reliability
Brand Name and Model
Warranties and Support
Repair Record
Price
The AST
is the best.
Acer
Apple AST
Gateway IBM Micron Dell
DEC
Acer
Instructor: Dr. Kang Sovannara 310 310
Making Better Decisions
Be creative
Increase knowledge
Use intuition
Dont overstress finality
Observe right timing
Instructor: Dr. Kang Sovannara 311
Using Groups to
Make Better Decisions
Advantages
More Points of View
More Possible Solutions
More Creative Solutions
Increased Commitment
Disadvantages
Dominant Individuals
Escalating Commitment
Time and Money Costs
Groupthink