Decision Making

Click to edit Master subtitle style

5/3/12

A decision represents a judgment, a final resolution of a conflict of needs, means, or goals, and a commitment to action made in face of uncertainty, complexity and even irrationality.
Conscious human process involving both

individual and social phenomenon. an opinion or a course of action

It is an act of projecting ones own mind upon It implies that there are various alternatives
5/3/12 and

the most desirable alternative is chosen

Existence of alternatives suggests that the

decision maker has freedom to choose an alternative of his liking.

Decision making may not be completely Goal directed.

rational but may be judgemental & emotional.

5/3/12

Types of Decisions
1. Programmed Decisions: . Are routine and repetitive. . Established well in advance. . Are comparatively easy to make. . Made by personnel at lower levels in the

organization wherein environment affecting decision making is static & well structured.

5/3/12

2. Non- programmed Decisions:

Are relevant for solving unique/unusual

problems in which various alternatives cannot be decided in advance. arranged in advance.

Outcomes of various alternatives cannot be Readymade solutions are not available. Made by managers at higher level.
5/3/12

3. Strategic Decisions:
Based on strategy which is a major action

plan in organization. part of organization.

Major decision which affects whole or major Contributes directly to the achievement of

organizational objectives.
May involve departure from earlier decisions. Plan, desired results, commitment. Normally a non programmed decision, which
5/3/12

4. Tactical decisions:
Tactical or operational decision is derived out

of strategic decision. organization.

Relates to day to day working of the Taken very frequently, mostly repetitive. Programmed. Outcome is short- term, & affects a narrow

part of the system.

Taken by lower level management.
5/3/12

Decision Making Conditions:

1. Certainty: Complete and accurate

knowledge of the outcome of each alternative as there is only one outcome of each alternative. alternative can be identified & probability of occurrence can be attached to each outcome.

2. Risk: Multiple possible outcomes for each

3. Uncertainty: Multiple outcomes for each

5/3/12 alternative

can be identified but there is no

5/3/12