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CHAPTER 2

NAME: JERWIN GATCHALIAN

TOPIC: What is decision making?
Characteristics of decision making
NAME: ANGEL GRACE NOMBRE
TOPIC: Characteristics of decision making
Framework
NAME: VHIN ALWYN PANCHO
TOPIC: Decision Support System
Categories of DSS
NAME: JERRY FIL BALTAZAR
TOPIC: Statistical Function
Why do we need models?
NAME: ROSEMARY BALAWANG
TOPIC: ECONOMIC FUNCTION
 DATAMEX COLLEGE OF SAINT ADELINE, INC.
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SUBJECT : OPERATION MANAGEMENT

COURSE : BACHELOR OF SCIENCE IN OFFICE

ADMINISTRATIO N

PROFESSOR : MR. IAN EMMANUEL ARSOLON

SEM/YR : SECOND YEAR FIRST SEMESTER

SCHEDULE : TUESDAY/THURSDAY/SATURDAY

2:00 PM – 5:00 PM

TOPICS : OPERATION DECISION MAKING

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INTRODUCTION - Thousand of business decisions are

made every day. Not all the decisions will make or break
the organization. But each one adds a measure of success
or failure to the operations. Hence decision- making
essentially involves choosing a particular course of action,
after considering the possible alternatives. This chapter
examines management as a science and the characteristics
of decisions. The use of economic and statically models is
discussed along with decision trees.
THINGS TO LEARN - All about operation decision
making; things to consider in decision making, algorithm,
and evaluation. A decision is a process that takes place
prior to the actual performance of a course of action that
has been chosen. Characteristics of decision; there are
different ways a decision may possess such as selective,
cognitive, dynamic, ongoing process, and evaluative. A
framework is the algorithm of decision making. Decision
support system is something you can use to support
decisions along with statistical and economic function.
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TOPIC - What is decision making?

- Characteristics of decision making

Decision Making- is a process of selection from a set of

alternative courses of action, which is thought to fulfill
the objectives of the decision problem more satisfactorily
than others. It is a course of action, which is consciously
chosen for achieving a desired result. A decision is a
process that takes place prior to the actual performance of
a course of action that has been chosen. In terms of
managerial decision making, it is an act of choice,
wherein a manager selects a particular course of action
from the available alternatives in a given situation.
Managerial decision making process involves establishing
of goals, defining tasks, searching for alternatives and
developing plans in order to find the best answer for the
decision problem.
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*Selective: It is a selective process in which the optimal
alternative is opted, among the various alternatives. The
selection of the
alternative is done, only
after evaluating all the
alternatives against the
objectives.
*Cognitive: As the
decision making
encompasses the
application of
intellectual abilities,
such as analysis,
knowledge, experience,
awareness and
forecasting, it is a
cognitive process.
*Dynamic: It is a dynamic activity in the sense that a
particular problem may have different solutions,
depending upon the time and circumstances.
DATAMEX COLLEGE OF SAINT ADELINE, INC.
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TOPIC - Characteristics of decision making
- Framework
*Positive or Negative: A
decision is not always
positive, sometimes even
after analyzing all the
points a decision may turn
out as a negative one.
*Ongoing process: We all
know that a company has
perpetual succession and
various decisions are
taken daily by different
levels of management to
keep the firm going.
These decisions are taken,
keeping in mind the objectives of the organization.
*Evaluative: Evaluation of the possible alternatives using
critical appraisal methods is a part of the decision-making
process.
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*Defining the
problem: The first
and foremost step
in the decision-
making process is
to clearly identify
the problem for
which a decision
has to be taken.
*Collecting
information:
Gathering the
relevant
information
concerning the problem is the next step in the process. For
this purpose, an internal assessment needs to be done,
while seeking external sources for the information.
*Identifying alternatives: After collecting the pertinent
information, you will come across the multiple courses of
action which can be taken to solve the given problem.
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*Weighing the alternatives: On the basis of different

parameters such as risk, economy for effort, timing, and
limitation of resources weigh each alternative and check
how accurately it resolves the issue and what are its
consequences.
*Selecting the best possible option: After weighing each
and every alternative, the next step in this process is to
select the best possible course of action, or a combination
thereof. The alternative which is able to attain the
objectives is regarded as the tentative decision, which is
evaluated for possible consequences.
*Planning and Execution: To convert the decision into
action, the course of action so selected is taken, along
with that supplementary actions are taken to block
negative consequences (if any).
*Taking the follow up of the action: In the last step, the
outcome of the decision is reviewed and evaluated as to
whether it is capable of resolving the problem.
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TOPIC - Decision Support System

- Categories of DSS

A decision support system (DSS) is an information

system that supports business or organizational decision-
making activities. DSS's serve the management,
operations and planning levels of an organization (usually
mid and higher management) and help people make
decisions about problems that may be rapidly changing
and not easily specified in advance.

CATERGORIES OF DECISION SUPPORT SYSTEM

-Data-driven DSS. These systems include file drawer and
management reporting systems, executive information
systems, and geographic information systems (GIS).
-Model-driven DSS. These DSS include systems that use
accounting and financial models, representational models,
and optimization models.
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-Knowledge-driven DSS. These systems suggest or

recommend actions to managers.
-Document-driven DSS. These systems integrate storage
and processing technologies for document retrieval and
analysis.
-Communication-driven and group DSS. Communication-
driven DSS focuses on communication, collaboration, and
coordination to help people working on a shared task,
while group DSS (GDSS) focuses on supporting groups
of decision makers to analyze problem situations and
perform group decision-making tasks.
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TOPIC - Statistical function

- Why do we need models?

-Statistical modeling is the method of applying numerical

analysis to datasets. This process summarizes the findings
of an assessment in such a manner that assessors may see
patterns in the data, draw conclusions, and finally answer
the questions to make informed decisions.

-We need a statistical model to understand the problem,

simplify its complexity, analyze and then present it
further for informed decision making. The statistical
model is a mathematical representation of observed data
to interpret the information more strategically.
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TOPIC: ECONOMIC FUNCTION

- The standard model of supply and demand taught in

introductory economics is a good example of a useful
economic model. Its basic purpose is to explain and
analyze prices and quantities traded in a competitive
market.