DECISION MAKING

DECISION MAKING

According to Fred Luthans in his book,

Organizational Behavior states that decision
making is universally defined as the selection of
alternatives.

According to Chester Barnard in The Function of

the Executive that a comprehensive analysis of
decision making is referred to as "the decision
process is a technique for narrowing down
options".
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DEFINITION?
DECISION-MAKING
DECISION-MAKING

Is :
AA PROCESS
PROCESS USED
USED TO
TO CHOOSE
CHOOSE AA
DIRECTION OF
DIRECTION OF ACTION
ACTION AS
AS AA
SOLUTION TO
SOLUTION TO AA PROBLEM”
PROBLEM”
 IdentifyingProblems
Identifying Problems

Datacollection
Data collectionand
andanalysis
analysis

DevelopingAlternatives
Developing Alternatives

DECISION-MAKING
DECISION-MAKING
PROCESS EvaluatingAlternatives
Evaluating Alternatives
PROCESS

ChoosingAlternative
Choosing Alternative

Implementingthe
Implementing theDecision
Decision

Controland
Control andEvaluation
Evaluation
TYPES OF DECISIONS
 PROGRAMMED DECISIONS

decisions
decisionsare
aretaken
takenbased
basedon
on
habits,
habits,rules,
rules,or
orprocedures.
procedures.

 NONPROGRAMMED DECISIOONS

decisions
decisionsare
aretaken
takento
todeal
dealwith
with
unique
uniqueproblems
problemsororrequire
require
special
specialtreatment"
treatment"
 Which is more effective, the decision
(not programmed) taken individually or
as a group?
(a)
(a)
Thegroup
The groupis
issuperior
superiorin
groupknowledge
group knowledgeis
insetting
settinggoals
isgreater.
greater.
goalsbecause
becausethe
theamount
amountof
of

Groupcollective
collectivejudgment
judgmentis
isvery
veryeffective
effectivein
inevaluating
evaluating
(b)
(b)
Group
decisionalternatives
decision alternatives

Groupsarearemore
moredare
darein
intaking
takingrisks
riskswhen
whenchoosing
choosingthe
thebest
best
(c)
(c) Groups
alternative.
alternative.
 GROUP DECISION MAKING

WEAKNESS
1. More time
2. Confirmation pressures within the group
3. Discussion can be dominated by one or a few
members
4. Ambiguous responsibilities
 Three Decision Making Situations
1.1. CERTAINTY
CERTAINTYCONDITION
CONDITION

“MANAGERS
“MANAGERSKNOWKNOWWHAT
WHATWILL
WILLHAPPEN
HAPPENCOMING
COMINGTIME,
TIME,
BECAUSE
BECAUSEIT'S
IT'SAVAILABLE
AVAILABLEACCURATE,
ACCURATE,
RELIABLE
RELIABLEINFORMATION
INFORMATIONMEASURED
MEASUREDAS
ASBASIC”
BASIC”

2.2. UNCERTAINTY
UNCERTAINTYCONDITION
CONDITION

“MANAGERS
“MANAGERSDODONOT
NOTKNOW
KNOWPROBABILITY,
PROBABILITY,
MAY
MAYNOT
NOTEVEN
EVENKNOW
KNOW
POSSIBLE
POSSIBLERESULTS”
RESULTS”

3.3.RISK
RISKCONDITION
CONDITION

“MANAGER
“MANAGERKNOWS
KNOWSPROBABILITY
PROBABILITY
POSSIBLE,
POSSIBLE,BUT
BUTINFORMATION
INFORMATION
FULL
FULLNOT
NOTAVAILABLE”
AVAILABLE”
INFLUENCE OF BEHAVIOR ON INDIVIDUAL
DECISION MAKING

"a collection of feelings of

pleasure/displeasure, views,
1. imperatives, tendencies in people,
value rational/irrational opinions, prejudices
and association patterns that determine
one's views"

Values​a​are
Values reused
usedas
asguidelines
guidelineswhen
whenyou
youhave
haveto
tochoose
choosesomething.
something.
 Decision-makersare
Decision-makers areinfluenced
influencedbybythe
thepersonality
personality
thatis
that isin
inhim.
him.include
includeattitudes,
attitudes,beliefs,
beliefs,and
andindividual
individual
2.2. needs.
needs.
PERSONALITY
PERSONALITY

1.1.RISK-Taking
RISK-TakingTendencies
Tendencies

The
Thelevel
levelof
ofcourage
courageto
totake
takerisks
riskswill
willdetermine
determine
The
Thedecision-making
decision-makingprocess
processisisdifferent
differentfor
foreach
each
organization.
organization.

2.2.POSSIBLE
POSSIBLENO
NOCOMPATIBILITY
COMPATIBILITY

After
Aftermaking
makingaadecision,
decision,people
peopleare
areoften
oftenplagued
plaguedby by
feelings
feelingsof
ofuneasiness
uneasiness(conflict)
(conflict)between
betweenwhat
whathashasbeen
been
decided
decidedand
andwhat
whatshould
shouldbe,be,giving
givingrise
riseto
tofeelings
feelingsofofdoubt
doubt
and
andthe
thebelief
beliefthat
thatthere
theremay
maybebeaabetter
betteralternative.
alternative.
How can we overcome doubt?
 Seek information
Seek information that
that supports
supports the
the
(a)
(a) policies of their decisions
policies of their decisions

Be objective,
Be objective, and
and try
try to
to believe
believe in
in the
the
(b)
(b) decisions
decisions taken
taken

Enhance the
Enhance the positive
positive elements
elements of
of the
the
(c)
(c) decisions
decisions taken.
taken.
 DECISION-MAKING STYLE.
1. Sensing:
Related to the tendency to seek facts, be realistic,
and see things in an objective perspective. This
function therefore places a high value on facts that
can be verified by the use of the five senses

2.Intuition
Relating to the tendency to try to uncover new
possibilities in order to change the way things are
handled.

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DECISION-MAKING STYLE.
3. Thinking
Tendency to seek systematic cause-and-effect
relationships to be analyzed as a whole, and to clearly
distinguish between right and wrong,

4. Feeling
The tendency to consider how oneself and others feel as
a result of the decisions made, in this case there are
differences between good and bad.

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 THANK YOU

 Please Prepare Your Presentation

Mid Exam Semester
Instruction
 Mid-Exam Semester will be held next week which
will perform offline in the class
 Please prepare your paper to do the exam (folio
paper)
 Closed the book
 The exam duration is only 90 minutes
 Exam material from the first meeting to today's
meeting
 For those who have finished taking the exam,
students can leave the class