UPES

UPES

| Jul 2012| 2012 UPES

 DECISION MAKING

The Selection from Among Alternatives of

a Course of Action

Management means Decision-making

Moore

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 CONCEPT OF DECISION-MAKING

The Selection from Among

Alternatives of a Course of Actions. It
is the Core of Planning.

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DECISIONS ARE OF TWO TYPES:

STRATEGIC DECISIONS

Have a major impact on the organization and

contribute to the achievement of organizational
objectives.

OPERATIONAL DECISIONS

Are related to day-to-day operations of the

organization.
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 DECISION-MAKING PROCESS

OBJECTIVES/GOALS
PROBLEM DIAGNOSIS AND ANALYSIS
SEARCH FOR ALTERNATIVES
EVALUATING ALTERNATIVES
CHOOSING THE BEST ALTERNATIVE
ACTION
RESULT

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TYPES OF MANAGERIAL DECISIONS

PERSONAL AND ORGANIZATIONAL

DECISIONS

BASIC AND ROUTINE DECISIONS

PROGRAMMED AND NON-PROGRAMMED

DECISIONS

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MODELS OF DECISION MAKING PROCESS
ECONOMIC MAN MODEL- Classical Economists
Man is completely rational in taking decisions. He takes
decisions based on the best alternative available
Steps taken:
Discover the problem or difficulty
Determine the goal to be achieved or define the
problem to be solved
Identify all alternative courses of action
Choose the best alternative
Act or implement the decision

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ADMINISTRATIVE MAN MODEL- Herbert Simon
In this man uses Rationality (reasonableness,
wisdom, prudence)
Steps are:
Set the goal or define the problem.
After identifying a desirable alternative
evaluate it to determine its acceptability
Implement the solution
Following the implementation

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SOCIAL MAN MODEL- Classical Psychologists

Man being a Social Animal

Having a bundle of feelings and emotions
Guided by his desires
Also subject to social pressures and influences
Usually such a person cannot take rational
decisions.

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2012 2012 UPES