DECISION MAKING

• Decision
Is the choice made from among available alternatives that is expected to result in a
favorable resolution to a problema.

• Decision making
Is the process of identifying problems, considerating and evaluating alternatives, arriving
at the decision, taking action, and assessing the outcome.

• Types of problems
o Crisis problems: A situation that urgently requires an immediate decisión.
o Non crisis problems: A problem that requires a decision but less urgently than a
crisis problem.

• Types of decisions
o Programmed decisions
The managers makes the programmed decisions when a situation occurs so often,
or is so well structured that it can be handled trough the use of present decisions
rules.
In well structured situation, managers need to consider relatively solving the same
kind of problems or meeting the same kind of well-structured situation, managers
can develope guidelines for solving that problem in the future.
o Non programmed decisions
When the situation occurs infrequently, is unique or is somewhat unstructured,
the decisionsare generally nonprogrammed are required much consideration.

• Decision making process

• The level and scope of decision making

Decisions are made at all levels of the organization:
• Conditions of decision making

o The diverse problems that managers face require that decisions be made under a
variety of circunstances.
o Managers know a lot about the circumstances of a problem that they can make a
decision and feel confident about the outcome.
o Managers don’t have enough information to be sure how a decision will turn out.
Depending on the level of information available decision making occurs under four
conditions.
CONDITIONS
o A condition of certainty
o A condition of risk
o A condition of uncertainty
o A condition of Ambiguity

• Group Decision Making

o Benefits:
 Groups can accumulate more knowledge and facts.
 Groups may have broader perspective and consider more approaches and
alternatives.
 Individuals who participate in group decision making are more likely to be
satisfied with the decision and to support its implementation.
 The group decision-making process servers as an important
communication device.
o Limitations:
 Groups tend to work more slowly and to take more time to reach a
decision.
 Too much dependance on group decision making may limit a manager’s
ability to act quickly and decisively when necessary.
 Group may be dominated by one individual or a small clique.
 Group effort frequently results in compromises that may not be optimal
for organizational effectiveness or performance.