Decision-making第1頁Ⅰ.DefinitionforDecisionAdecisionisdefinedastheselectionofacourseofactionfromamongalternatives;itisthecoreofplanning.Aplancannotbesaidtoexistunlessadecisionhasbeenmade.第2頁Ⅰ.DefinitionforDecisionEveryorganizationgrows,prospers,orfailsasaresultofdecisionsbyitsmanagers.Case-1:Nokia’swrongdecision-making第3頁Ⅰ.DefinitionforDecisionThequalityofmanager’sdecisionistheyardstickoftheireffectivenessandoftheirvaluetotheorganization.i.e.theimportance,number,andresultsoftheirdecision第4頁Ⅱ.TypesofDecisionsThemanagerasdecisionmakerisaproblemsolver,chargedwitheitherselectingfromavailablealternativesorinventinganalternative.ProgrammedandNon-programmedDecisions2.IndividualDecisionsandGroupDecisions第5頁Ⅱ.TypesofDecisionsProgrammedandNon-programmedDecisionsAdistinctioncanbemadebetweenprogrammedandnon-programmeddecisionswhichresultfromdifferenttypesofproblemsandusedifferenttypesofprocedures.第6頁Ⅱ.TypesofDecisionsProgrammeddecisionAprogrammeddecisionisforstructuredandroutineproblems.Programmeddecisionsarerepetitiveandwelldefined,andproceduresexistforresolvingtheproblem.Theyarewellstructuredbecausecriteriaofperformancearenormallyclear,goodinformationisavailableaboutcurrentperformance,alternativesareeasilyspecified,andthereisrelativecertaintythatthechosenalternativewillbesuccessful.第7頁Ⅱ.TypesofDecisionsNon-programmeddecisionsNon-programmeddecisionsareusedforunstructured,novel,andill-definedsituationsofanonrecurringnature.Whenaproblemcontainselementsthatmanagementhasnotpreviouslyconfrontedorifaproblemiscomplexorextremelyimportant,itrequiresadifferentandperhaps,uniquesolution.Non-programmeddecisionsareusedwhenaclear-cutdecisioncriteriondoesnotexist.Typically,fewalternativescanbedevelopedforanon-programmeddecision,soasinglesolutioniscustom-tailoredtotheproblem.第8頁DecisionProblemProceduresExamplesProgrammedrepetitiveroutinerules

standardoperatingprocedurespoliciesBusiness:processingpayrollvoucherCollege:processingadmissionapplicantsNon-programmedcomplexnovelcreativeproblemsolvingBusiness:introducinganewproductCollege:Constructingnewclassroomfacilities第9頁Note:Mostdecisionsareneithercompletelyprogrammedorcompletelynon-programmed;theyareacombinationofboth.Problemsthatcomeupfrequentlyandhaveagreatdealofuncertaintysurroundthemareoftenofastrategicnatureandshouldbetheconcernoftopmanagement.Upper-levelmanagersmakemostnon-programmeddecisionsbecausetheyhavetodealwithunstructuredproblems.Problemsthatoccurfrequentlyandhavefairlycertainoutcomesshouldbetheconcernoflowerlevelsofmanagement.Middlemanagersinmostorganizationconcentratemostlyonprogrammeddecisions.第10頁Thenatureoftheproblem,howfrequentlyitarises,andthedegreeofuncertaintysurroundingitshoulddictatetheappropriatelevelofmanagementformakingthedecision...……………..……...………….…....………HighestlevelLowestlevelunstructuredProgrammeddecisionNon-programmeddecision第11頁Ⅱ.TypesofDecisionsIndividualDecisionsandGroupDecisionsIndividualdecisionsmadebymanagerscanbedescribedintwoways.Firstistherationalapproach,whichsuggestshowmanagersshouldtrytomakedecisions.Secondisthelimited(bounded)rationalityperspective,whichdescribeshowdecisionsactuallyhavetobemadeunderseveretimeandresourceconstraints.第12頁RationalApproachTherationalapproachtoindividualdecisionsstressestheneedforsystematicanalysisofaproblemfollowedbychoiceandimplementationinalogicalstepbystepsequence.Thesignificanceofrationalapproach:Therationalapproachwasdevelopedtoguideindividualdecisionsbecausemanymanagerswereobservedtobeunsystematicandarbitraryintheirapproachtoorganizationaldecisions.Note:Therationalmodelisan“ideal”notfullyachievableintherealworldofuncertainty,complexity,andrapidchange,themodeldoeshelpmanagersthinkaboutdecisionsmoreclearlyandrationally.Managersshouldusesystematicprocedurestomakedecisionswheneverpossible.第13頁Whycan’tweachievecompleterationality?Decisionsmustoperateforthefuturewhichinvolvesuncertainties.Itisdifficulttorecognizeallthealternativesthatmightbefollowedtoreachagoal.Notallalternativescanbeanalyzed.Becauseofthelimitationoftime,managers’capacity,cannotevaluateeverygoal,problemandalternative.第14頁HerbertSimon’ssatisfyingruleSincemanagerscannotbecompletelyrationalinpractice,theysometimesallowtheirdesireto“playitsafe”tointerferewiththedesiretoreachthebestsolutionunderthecircumstances.HerbertSimoncalledthisthesatisfyingrule,thatis,pickingacourseofactionthatissatisfactoryorgoodenoughunderthecircumstances.第15頁GroupdecisionsInmostorganizations,agreatnumberofdecisionsareachievedthroughcommittees,teams,andothergroups.Researchhasshownthatconsensusdecisionswithfiveormoreparticipantsaresuperiortoindividualdecision.Theproblemsinvolvetheexpertiseinmanyfields,usuallynotpossessedbyoneperson.第16頁Ⅲ.TheprocessofDecision-makingIdentifyanddefinetheproblemDevelopalternativesolutionsEvaluatealternativesolutionsCertaintyconditionsRiskconditionsUncertaintyconditionsSelectalternativeImplementdecisionEvaluateandcontrol第17頁ProblemidentificationHowtolocateproblem?◆deviationfrompastperformance◆deviationfromaplan◆outsidecritisism第18頁ThreetypesofproblemsOpportunityCrisisRoutineCrisisandroutineproblemspresentthemselvesandmustbeattendedbymanagers.Opportunities,incontrast,mustusuallybediscovered.Oftentheygounnoticedandareeventuallylostbyaninattentivemanager.Becausemostcrisesandroutineproblemsdemandimmediateattention,amanagermayspendagreatdealoftimehandlingminorcrisesandsolvingroutineproblemsandmayspendagreatdealoftimehandlingminorcrisesandsolvingroutineproblemsandmaynothavetimetopursueimportantnewopportunities.Manywell-managedorganizationstrytodrawattentionawayfromcrisesandroutineproblemsandtowardlongerrangeissuesthroughplanningactivities.第19頁DevelopingAlternativeSolutionsAfterdefiningtheproblemConsideringthepotentialconsequencesInvestigatingrelevantinternalandexternalenvironmentsoftheorganizationInfluencedbythelimitedtimeandcostconstraints*Thereisapositiverelationshipbetweenthenumberofalternativesconsideredandthespeedwithwhichdecisionscanbereached.第20頁EvaluatingAlternativesIneverydecisionsituation,theobjectiveinmakingadecisionistoselectthealternativethatproducesthemostfavorableoutcomesandavoidstheleastfavorableoutcomes.e.g.maximizeshareholderwealth,minimizecosts,improvecustomersatisfaction,winaqualityaward,meetmandatorydeadlinesThealternative-outcomerelationshipisbasedonthreepossibleconditionsCertainty.Thedecisionmakerhascompleteknowledgeoftheoutcomesofeachalternative.Risk.Thedecisionmakerhassomeprobabilisticestimateoftheoutcom