Decision Making : Management Function
- 2. Managerial decision making • Decision-making is the process by which a course of action is selected as the way to deal with a specific problem. • Managers are usually evaluated and rewarded on the basis of the importance and results of their decisions
- 4. Significance and limitations of rational decision-making • The process of rational decision-making is very similar to the process of strategic planning.
- 5. Significance of rational decision- making • Managers who use a rational, intelligent and systematic approach are more likely to come up with high quality solutions. • They have a clear understanding of alternative courses of action
- 6. Significance of rational decision- making • It is based on the information available with the decision-makers and their ability to evaluate alternatives • Rational decision-making aims a deciding the best solution
- 7. Level of managers responsible for making decisions Middle –Level Management Lower-Level Management Upper-Level Management Narrow Intermediate Decision Broad Decision
- 8. Limitations of rational decision-making • Difficult for managers to be completely rational • Difficult to determine all the alternative courses of action • Difficult to implement in areas not ventured into
- 9. Limitations of rational decision-making • All possible alternatives cannot be thoroughly analyzed • Limitation of information, time and certainty curb rationality • Risk avoiding tendency disrupts their rational decision-making process
- 10. Decision-making process • Identify the problem • Scanning stage • Categorization stage • Diagnosis stage • Identify resources • Generate alternative solutions • Brainstorm
- 11. Decision-making process • Evaluate alternatives • Implement the decision • Monitor the decision
- 12. How to make a business plan • The following steps are followed in the process of making a business plan: • 1. Understanding your business - Situation Analysis • 2. What do “you” want? – Forming Personal Objectives • 4. Forming the right business objectives
- 13. How to make a business plan • 5. Forming Strategies And Tactics • 6. Written Document • 7. Review & Control and back to Step 1