Management

What is management ?

– Management is a universal phenomenon. It is a

very popular and widely used term. All
organizations - business, political, cultural or social
are involved in management because it is the
management which helps and directs the various
efforts towards a definite purpose. 
 What is management?

– According to F.W. Taylor, “Management is an art of

knowing what to do, when to do and see that it is
done in the best and cheapest way”.
– It is the process of working with and through
others to effectively achieve the goals of the
organization, by efficiently using limited resources
in the changing world
 What is management?

• Good management includes both being

effective and efficient
– Being effective means doing the appropriate task
– Being efficient means doing the task correctly, at
least possible cost with minimum wastage of
resources.
 What is management?

• Management can be defined in detail in following

categories :
1. Management as a Process
2. Management as an Activity
3. Management as a Discipline
4. Management as a Group
5. Management as a Science
6. Management as an Art
7. Management as a both Science and Art
 1. Management as a Process
• As a process, management refers to a series of
inter-related functions.
• according to George R. Terry, “Management
is a distinct process consisting of planning,
organizing, actuating and controlling,
performed to determine and accomplish
stated objective by the use of human beings
and other resources”
 1. Management as a Process
• As a process, management consists of three aspects:
• Management is a social process - Since human factor is most
important among the other factors, therefore management is
concerned with developing relationship among people.
• Management is an integrating process - Management
undertakes the job of bringing together human physical and
financial resources so as to achieve organizational purpose.
• Management is a continuous process -  It is a never ending
process. It is concerned with constantly identifying the
problem and solving them by taking adequate steps. It is an
on-going process
2. Management as an Activity
• Like various other activities performed by
human beings such as writing, playing, eating,
cooking etc, management is an activity
because a manager is one who accomplishes
the objectives by directing the efforts of
others. According to Koontz, “Management is
what a manager does”.
2. Management as an Activity
• Management as an activity includes -
• Informational activities - the manager constantly has to
receive and give information orally or in written.
• Decisional activities - managers are continuously involved in
decisions of different kinds since the decision made by one
manager becomes the basis of action to be taken by other
managers. (E.g. Sales Manager is deciding the media &
content of advertising).
• Inter-personal activities -Management involves achieving
goals through people. managers have to interact with
superiors as well as the sub-ordinates. the inter-personal
activities include with the sub-ordinates and taking care of
the problem. (E.g. Bonuses to be given to the sub-ordinates).
3. Management as a Discipline
• Management as a discipline refers to that branch of knowledge which
is connected to study of principles & practices of basic administration
• Any branch of knowledge that fulfills following two requirements is
known as discipline:
• There must be scholars & thinkers who communicate relevant
knowledge through research and publications.
• The knowledge should be formally imparted by education and training
programs.
• Since management satisfies both these problems, therefore it qualifies
to be a discipline. Though it is comparatively a new discipline but it is
growing at a faster pace.
 4. Management as a Group
• Management as a group refers to all those
persons who perform the task of managing
an enterprise.
• Management as a group may be looked upon
in 2 different ways:
– All managers taken together.
– Only the top management
 4. Management as a Group
• The interpretation depends upon the context in
which these terms are used. Broadly speaking, there
are 3 types of managers -
– Patrimonial / Family Manager: Those who have become
managers by virtue of their being owners or relatives of
the owners of company.
– Professional Managers: Those who have been appointed
on account of their specialized knowledge and degree.
– Political Managers / Civil Servants: Those who manage
public sector undertakings.
 5. Management as a Science
• Science is a systematic body of knowledge
pertaining to a specific field of study that
contains general facts which explains a
phenomenon. It establishes cause and effect
relationship between two or more variables
and underlines the principles governing their
relationship. These principles are developed
through scientific method of observation and
verification through testing.
 5. Management as a Science
• Science is characterized by following main features:
– Universally acceptance principles
Scientific principles represents basic truth about a particular
field of enquiry. These principles may be applied in all
situations, at all time & at all places. E.g. - law of gravitation
which can be applied in all countries irrespective of the time.
Management contains some fundamental principles which
can be applied universally like the Principle of Unity of
Command i.e. one man, one boss. This principle is applicable
to all type of organization - business or non business.
 5. Management as a Science
• Science is characterized by following main features:
– Experimentation & Observation
scientific principles are derived through scientific
investigation & researching i.e. they are based on logic.
E.g. the principle that earth goes round the sun has been
scientifically proved.
Management principles are also based on scientific
enquiry & observation. They have been developed
through experiments & practical experiences of large no.
of managers. E.g. it is observed that fair remuneration to
personal helps in creating a satisfied work force.
 5. Management as a Science
• Science is characterized by following main features:
– Cause & Effect Relationship
 Principles of science lay down cause and effect
relationship between various variables. E.g. when metals
are heated, they are expanded.
The same is true for management, therefore it also
establishes cause and effect relationship. E.g. if workers
are given bonuses, fair wages they will work hard but
when not treated in fair and just manner, reduces
productivity of organization.
 5. Management as a Science
• Science is characterized by following main features:
– Test of Validity & Predictability
 Validity of scientific principles can be tested at any time or
any number of times i.e. they stand the test of time. Each
time these tests will give same result. Moreover future events
can be predicted with reasonable accuracy by using scientific
principles. E.g. H2 & O2 will always give H2O.
Principles of management can also be tested for validity. E.g.
principle of unity of command can be tested by comparing
two persons - one having single boss and one having 2 bosses.
The performance of 1st person will be better than 2nd.
 5. Management as a Science
• It cannot be denied that management has a
systematic body of knowledge but it is not as
exact as that of other physical sciences like
biology, physics, and chemistry etc. The main
reason for the inexactness of science of
management is that it deals with human
beings and it is very difficult to predict their
behavior accurately
 6. Management as an Art
• Art implies application of knowledge & skill to trying
about desired results. 
• An art may be defined as personalized application of
general theoretical principles for achieving best
possible results. Art has the following characters
– Practical Knowledge
– Personal Skill
– Creativity
– Perfection through practice
– Goal-Oriented
 6. Management as an Art
– Practical Knowledge
Every art requires practical knowledge therefore learning of
theory is not sufficient.
A manager can never be successful just by obtaining degree or
diploma in management; he must have also know how to
apply various principles in real situations by functioning in
capacity of manager
– Personal Skill
Every manager has his own way of managing things based on
his knowledge, experience and personality, that is why some
managers are known as good managers whereas others as
bad.
 6. Management as an Art
– Creativity
Management is creative in nature like any other art. It combines
human and non-human resources in useful way so as to achieve
desired results. It tries to produce sweet music by combining chords in
an efficient manner.
– Perfection through practice
Practice makes a man perfect. managers learn through an art of trial
and error initially but application of management principles over the
years makes them perfect in the job of managing.
– Goal-Oriented
management is also directed towards accomplishment of pre-
determined goals. Managers use various resources like men, money,
material, machinery & methods to promote growth of an organization.
7. Management as both Science and Art

• It is considered as a science because it has an

organized body of knowledge which contains
certain universal truth. It is called an art
because managing requires certain skills
which are personal possessions of managers.
Science provides the knowledge & art deals
with the application of knowledge and skills.
Managerial
Skills
 Managerial Skills
• Management is challenging job. It requires certain skills
to accomplish such a challenge. Thus, essential skills
which every manager needs for doing a better
management are called as Managerial Skills.
• According to Professor Robert Katz, there are three 
managerial skills :
– conceptual skill (goal and objectives)
– Human Relations (interpersonal) skill (meet many people,
negotiation)
– technical skill (small activities that may lead to achieve the goal
and objectives)
 Managerial Skills
• According to Prof. Robert Katz, all managers require above three managerial
skills. However, the degree (amount) of these skills required varies (changes)
from levels of management and from an organization to organization.

• The above picture or diagram shows the managerial skills which are required
by managers working at different levels of management. The top-level
managers require more conceptual skills and less technical skills. The lower-
level managers require more technical skills and fewer conceptual skills.
Human relations skills are required equally by all three levels of management.
 Managerial Skills
1. Conceptual Skills
– Conceptual skill is the ability to visualize (see) the
organization as a whole. It includes Analytical, Creative
and Initiative skills. It helps the manager to identify the
causes of the problems and not the symptoms. Conceptual
skills are mostly required by the top-level management
 Managerial Skills
2. Human Relations Skills
– It is an ability to work with people. It helps the
managers to understand, communicate and work
with others. Human relations skills are required by
all managers at all levels of management. This is
so, since all managers have to interact and work
with people.
 Managerial Skills
3. Technical Skills
– A technical skill is the ability to perform the given
job. Technical skills help the managers to use
different machines and tools. It also helps them to
use various procedures and techniques. The low-
level managers require more technical skills. This
is because they are in charge of the actual
operations.
 Managerial Skills
4. Communication Skills
– Communication skills are required equally at all three
levels of management. A manager must be able to
communicate the plans and policies to the workers. He
must encourage a free-flow of communication in the
organization.
5. Administrative Skills
– Administrative skills are required at the top-level
management. The top-level managers should know how
to make plans and policies. They should also be able to
control the full organization.
 Managerial Skills
6. Leadership Skills
– Leadership skill is the ability to influence human behavior.
A manager requires leadership skills to motivate the
workers. These skills help the Manager to get the work
done through the workers.
7. Problem Solving Skills
– Problem solving skills are also called as Design skills. A
manager should know how to identify a problem. He should
also possess an ability to find a best solution for solving any
specific problem. This requires intelligence, experience and
up-to-date knowledge of the latest developments.
 Managerial Skills
8. Decision Making Skills
– Decision-making skills are required at all levels of
management. However, it is required more at the
top-level of management. A manager must be
able to take quick and correct decisions. He must
also be able to implement his decision wisely. The
success or failure of a manager depends upon the
correctness of his decisions.
Functions of Managers
 Functions of Managers
• Good managers discover how to master five basic functions:
planning, organizing, staffing, leading, and controlling.
• Planning: This step involves mapping out exactly how to
achieve a particular goal. Say, for example, that the
organization's goal is to improve company sales. The
manager first needs to decide which steps are necessary to
accomplish that goal. These steps may include increasing
advertising, inventory, and sales staff. These necessary steps
are developed into a plan. When the plan is in place, the
manager can follow it to accomplish the goal of improving
company sales.
 Functions of Managers
• Organizing: After a plan is in place, a manager
needs to organize his team and materials
according to his plan. Assigning work and
granting authority are two important
elements of organizing.
 Functions of Managers
• Staffing: After a manager discerns his area's needs,
he may decide to support his staffing by recruiting,
selecting, training, and developing employees. A
manager in a large organization often works with the
company's human resources department to
accomplish this goal.
 Functions of Managers
• Leading: A manager needs to do more than just plan,
organize, and staff the team to achieve a goal. He must also
lead.
• Leading involves motivating, communicating, guiding, and
encouraging. It requires the manager to coach, assist, and
problem solve with employees.
 Functions of Managers
• Controlling: After the other elements are in
place, a manager's job is not finished. He
needs to continuously check results against
goals and take any corrective actions
necessary to make sure that his area's plans
remain on track.
 Functions of Managers
• All managers at all levels of every organization
perform these functions, but the amount of
time a manager spends on each one depends
on both the level of management and the
specific organization.
 What is planning
and
why you need to plan
 What is planning and why you need to
plan
• Planning is preparing a sequence of action
steps to achieve some specific goal. If you do it
effectively, you can reduce much the necessary
time and effort of achieving the goal.
• One more reason why you need planning is
again the 80/20 Rule. It is well established that
for unstructured activities 80 percent of the
effort give less than 20 percent of the valuable
outcome.
 Basic Steps in the Management Planning
Process
• Establish Goals: in quantitative or qualitative terms
• Identify Resources: Each goal should have financial and
human resources
• Establish Goal-Related Tasks
• Prioritize Goals and Tasks: ordering objectives in terms of
their importance
• Create Assignments and Timelines
• Establish Evaluation Methods
• Identify Alternative Courses of Action
Motivation
• At one time, employees were considered just another input into
the production of goods and services.
• But this changed after the Hawthorne Studies. The Hawthorne
studies were conducted by Elton Mayo at Hawthorne Plant in the
1920s.
• The researchers were studying the effect of different working
environments on productivity.
• They used lighting as an experimental variable (the effect of bright
lighting and dull lighting). Initially they noticed that employees
were working harder but it was not because of the lighting.
• They concluded that productivity increased due to attention that
the workers got from the research team and not because of
changes to the experimental variable.
 Motivation
• Hawthorne studies found that employees are
not motivated solely by money but motivation
is linked to employee behavior and their
attitudes.
• The Hawthorne Studies began the human
relations approach to management, so the
needs and motivation of employees became
the primary focus of managers.
Motivation
Motivation
 Motivation
• Motives can be divided into two types:
external and internal.
 Motivation

• Intrinsic (inside) motivation refers to

motivation that is driven by an interest
or enjoyment in the task itself, and
exists within the individual rather than
relying on any external pressure.
• Intrinsic motivation is based on taking
pleasure in an activity rather than
working towards an external reward
 Motivation
• Extrinsic (outside) motivation refers to the performance of an
activity in order to attain an outcome.
Motivation
Motivation
Motivation
Motivation
Motivational theories
Motivational theories
Motivational theories- Incentive theory

Studies show that if the person receives the

reward immediately, the effect is greater, and
decreases as duration lengthens.

Motivation comes from two sources: oneself,

and other people.
 Motivational theories- Drive-reduction
theory
• The Drive Reduction Theory grows out of the
concept that we have certain biological drives,
such as hunger. As time passes the strength of
the drive increases if it is not satisfied (in this
case by eating). Upon satisfying a drive the
drive's strength is reduced.
 Motivational theories- Drive-reduction
theory
• Drive theory has some intuitive. For instance
when preparing food, the drive model appears
to be compatible with sensations of rising
hunger as the food is prepared, and, after the
food has been consumed, a decrease in
subjective hunger.
 Motivational theories- Cognitive
dissonance theory
• Suggested by Leon Festinger, cognitive
dissonance occurs when an individual
experiences some degree of discomfort
resulting from an inconsistency between two
cognitions: their views on the world around
them, and their own personal feelings and
actions.
 Motivational theories- Cognitive
dissonance theory
• The feeling of discomfort produced by the
presence of two thoughts that are in conflict
from one to another
Motivational theories- Cognitive dissonance
theory
• the theory of cognitive dissonance proposes that
people have a motivational drive to reduce
dissonance.
• They do this by changing their attitudes, beliefs,
or actions, rather than facing the inconsistencies,
because dissonance is a mental strain.
• Dissonance is also reduced by justifying, blaming,
and denying. It is one of the most influential and
extensively studied theories in social psychology.
Motivational theories- Cognitive dissonance
theory
 Motivational theories- Need hierarchy
theory
• The content theory includes the hierarchy of needs from Abraham
Maslow and the two- factor theory from Herzberg. Maslow's
theory is one of the most widely discussed theories of motivation
• According to him, people are motivated by unsatisfied needs. The
lower level needs such as Physiological and Safety needs will have
to be satisfied before higher level needs are to be addressed
 Motivational theories- Need hierarchy
theory
• So theory can be summarized as follows:
– Human beings have wants and desires which influence
their behavior. Only unsatisfied needs influence behavior,
satisfied needs do not.
– Since needs are many, they are arranged in order of
importance, from the basic to the complex.
– The person advances to the next level of needs only after
the lower level need is at least minimally satisfied.
– The further the progress up the hierarchy, the more
individuality, humanness and psychological health a
person will show.
 Motivational theories- Need hierarchy
theory
• The needs, listed from basic (lowest-earliest) to
most complex (highest-latest) are as follows:
– Physiology (hunger, thirst, sleep, etc.)
– Safety/Security/Shelter/Health
– Belongingness/Love/Friendship
– Self esteem Recognition/Achievement
– Self actualization
Motivational theories- Need hierarchy
theory
Motivational theories-
Herzberg's two-factor theory
• Frederick Herzberg's two-factor theory .The
theory is sometimes called the "Motivator-
Hygiene Theory" and/or "The Dual Structure
Theory."
Motivational theories-
Herzberg's two-factor theory
• The Motivator factor in the workplace result in
job satisfaction, but if absent, they don't lead
to dissatisfaction but no satisfaction.
Motivational theories-
Herzberg's two-factor theory
• The factors that motivate people can change
over their lifetime, but "respect for me as a
person" is one of the top motivating factors at
any stage of life.
• Motivators give positive satisfaction
Motivational theories-
Herzberg's two-factor theory
• He distinguished between:

– The name Hygiene factors is used because, like

hygiene, the presence will not make you healthier,
but absence can cause health deterioration.
– Hygiene factors; (e.g., job security, salary ) do not
motivate if present, but, if absent, result in
demotivation.
Motivational theories-
Herzberg's two-factor theory
Motivational theories-
Herzberg's two-factor theory
 The Communication Process
• The goal of communication is to convey information—
and the understanding of that information—from one
person or group to another person or group.

• This communication process is divided into three basic

components: A sender transmits a message through a
channel to the receiver.
 The Communication Process
• The sender first develops an idea, which is
composed into a message and then
transmitted to the other party, who interprets
the message and receives meaning.
Information theorists have added somewhat
more complicated language.
• Developing a message is known as encoding.
Interpreting the message is referred to as
decoding.
 The Communication Process
• The other important feature is the feedback cycle. When two
people interact, communication is rarely one-way only.
• When a person receives a message, she responds to it by giving a
reply. The feedback cycle is the same as the sender-receiver
feedback noted in previous figure . Otherwise, the sender can't
know whether the other parties properly interpreted the
message or how they reacted to it.
• Feedback is especially significant in management because a
supervisor has to know how subordinates respond to directives
and plans.
• The manager also needs to know how work is progressing and
how employees feel about the general work situation.
 The Communication Process
• The critical factor in measuring the effectiveness of
communication is common understanding.
• Understanding exists when all parties involved have a
mutual agreement as to not only the information,
but also the meaning of the information.
• Effective communication, therefore, occurs when the
intended message of the sender and the interpreted
message of the receiver are one and the same.
• Although this should be the goal in any
communication, it is not always achieved.
 The Communication Process
• The most efficient communication occurs at a minimum
cost in terms of resources expended. Time, in particular,
is an important resource in the communication process.
• For example, it would be practically impossible for an
instructor to take the time to communicate individually
with each student in a class about every specific topic
covered. Even if it were possible, it would be costly.
• This is why managers often leave voice mail messages
and interact by e-mail rather than visit their
subordinates personally.
 The Communication Process
• However, efficient time-saving communications are not
always effective. A low-cost approach such as an e-mail
note to a distribution list may save time, but it does not
always result in everyone getting the same meaning from
the message.
• Without opportunities to ask questions and clarify the
message, incorrect interpretations are possible.
• In addition to a poor choice of communication method,
other barriers to effective communication include noise
and other physical distractions, language problems, and
failure to recognize nonverbal signals.
 The Communication Process
• Sometimes communication is effective, but not
efficient.
• A work team leader visiting each team member
individually to explain a new change in procedures
may guarantee that everyone truly understands the
change, but this method may be very costly on the
leader's time.
• A team meeting would be more efficient. In these
and other ways, potential tradeoffs between
effectiveness and efficiency occur.
Decision making
 Decision making
• Decision making under risk
• Decision making under uncertainty
Decision making
Decision making under
• Decision Rules:
– Various outcomes exist
– Probabilities associated with each outcome are
also known
• Dominance rule
• Aspiration Level Criterion
• Most Probable Future
• Expected Value Criterion
Decision making under
Example- Profit Data

Summation of all probabilities = 1

A1, A2,A3,A4, A5 are the alternatives
A11=3$, A12=- 1$.....(positive: profits or negative : losses
n=number of alternatives = 5
i= 1,2,3,4,5
the maximum number of comparisons for n alternatives is equal to
 Decision making under
Dominance Rule

• If there is a pair of alternatives Ai And Ak such that V(Oij)>= V(Okj) for all i, Ai is said to
dominate Ak.
• The alternative Ak may then be discarded from the decision set.
• This approach may not yield a unique solution but can reduce the size of the matrix.
Q1
3 A1
4 A2
4<3
A2 dominates A1
Decision making under
Dominance Rule
Q1
4 A2
5 A3
4<5
A3 dominates A2

Q4 Q3 Q2 Q1
2 0 -2 5 A3
0 0 -2 2 A4
2>0 0=0 -2=-2 5>2
A3 dominates A4
Decision making under
Dominance Rule

Q4 Q3 Q2 Q1
2 -2 5 5 A3
0 -4 5 5 A5
2>0 -2>-4 5=5 5=5
A3 dominates A5
 Decision making under
Aspiration Level
• This rule involves selecting some level of
aspiration (target)
• Then selecting the alternative such that the
probability of achieving this target is
maximized
Decision making under
Aspiration Level
• Aspiration level: Profit of 5 or higher is desirable
• A2 , A3, and A5 meet the aspiration level
• Among these alternatives. Alternative 3 and 5 has higher
probability of achieving that (0.5) than alternative 2(0.3),
therefore, select either A3 or A5 (A3 better Why? Because
applying dominance rule A3 dominates A5)
Decision making under
Aspiration Level
• Aspiration Level: Possible loss is no worse than
-1(loss)
• Only A1 meets the aspiration level, therefore,
select A1
Decision making under
Most Probable Future
• Consider the highest probability outcome
• Select the best alternative based on that outcome, i.e., the
problem is reduced to decision making under certainty
• The highest probability is 0.5 corresponding to objective O1
• A3 andA5 have the best profit considering outcome O1, therefore,
select A3 or A5 (A3 is better because of dominance relation).
 Decision making under
Expected Value Criterion
• E(x) = Sum piVi,
where i=1,…,0 n and n is the number of
outcomes
• The alternative with the best expected value is
selected
E(A1)=0.5*3+0.1*-1+0.1*1+0.3*1=1.8
E(A2)=0.5*4+0.1*0+0.1*-4+0.3*6=3.4
E(A3)=0.5*5+0.1*-2+0.1*0+0.3*2=2.9
E(A4)=0.5*2+0.1*-2+0.1*0+0.3*0=.9
E(A1)=0.5*5+0.1*-4+0.1*-1+0.3*0=2
 Decision making under
• Several possible outcomes are considered
• However, their probabilities cannot be stated
• The conditions that lead to uncertainty are
unavailable of relative frequency knowledge or
difficulty of performing an experiment to determine
probabilities.
Decision making under
• Dominance
• Laplace principle
• Pessimistic Approach
• Optimistic Approach
• Hurwicz Rule
• Savage principle (Minimum Regret)
Decision making under

Example-Profit matrix

Consider the following representing profits

Decision making under
Dominance
• If there is a pair of alternatives Ai And Ak such that V(Oij)>=
V(Okj) for all i, Ai is said to dominate Ak. The alternative Ak
may then be discarded from the decision set. This
approach may not yield a unique solution but can reduce
the size of the matrix.
• A2 dominates A5,
• therefore A5 will be eliminated.
 Decision making under
Laplace Rule
• This is called the principle of insufficient reason. It
assumes all possible futures are of equal probability.
• (p=1/m) and then selects the alternative that maximizes
the expected profit (m is the number of outcomes)
• Consider the same example
• P1=p2=p3=p4=1/4=0.25
• E(A1)=4*0.25+4*0.25+0*0.25+2*0.25=2.5
• E(A2)=2, E(A3)=2, E(A4)=2  the alternative with the
maximum profit, A1, is selected.
 Decision making under
Laplace Rule
Q4 Q3 Q2 Q1
E(Ai) 25. 25. 25. 25.
2.5 2 0 4 4 A1
2 2 2 2 2 A2
2 0 0 8 0 A3
2 0 0 6 2 A4
5. 0 1 1 0 A5

• the alternative with the maximum profit, A1,

is selected.
 Decision making under
Pessimistic Rule
• Maximin principle examines minimum profit
associated with each Ai and then select Ai that
maximizes minimum profit. This pessimistic
(conservative) principle considers the worst
outcomes and makes worst outcomes as
desirable as possible.
• Select A2
Decision making under
Optimistic Rule
• Maximax is a highly optimistic approach
where a maximum profit for each Ai is
determined and then Ai with which maximizes
the maximum profit is selected.

• Select A3
Decision making under
Hurwicz Rule
• Moderation between extreme optimism and extreme
pessimism
• Index of optimism, a
• Index of pessimism (1-a)
• Measure = a * best value+(1-a) * worst value
• Let a =0.7 , then Select A3
• It is a weighed average between Best and Worst
 Decision making under
Minimum Regret
• First a new matrix called {regret matrix” is computed by:
1. Calculating the max profit for each column
Q4 Q3 Q2 Q1

2 0 4 4 A1
2 2 2 2 A2
0 0 8 0 A3
0 0 6 2 A4
0 1 1 0 A5
2 2 8 4 max
 Decision making under
Minimum Regret
2. For each Ai-Oj combination, the difference between the profit
that will result and the maximum profit that could be obtained for
the Oj under consideration is computed (this quantity is called
Regret)
3. Next, maximum regret is determined for each alternative
Max Q4 Q3 Q2 Q1
regret
4 0 2 8-4=4 4-4=0 A1
6 0 0 8-2=6 4-2=2 A2
4 2 2 8-8=0 4-0=4 A3
2 2 2 8-6=2 4-2=2 A4
7 2 1 8-1=7 4-0=4 A5
2 2 8 4 max
Decision making under

Minimum Regret
4. Then the alternative with minimum of maximum
regrets is selected.
A4 is selected