Decsion Making Models

Abstract

This topic contains the definition of decision making, stages of decision making, characteristics of management making models, decision scope. It explains the different models of decision making and how they can be utilized in the work environment to minimize the effect of a problem situation by giving examples (e.g.). This assignment is based on the information gathered from, Wikipedia, the free encyclopedia, Management, 1e (chapter 9: Decision Making),Problem Solving Approach(rEsource page, University of Phoenix).

Experience with Decision Making Models

Decision making is the cognitive process leading to the selection of a course of action among alternatives. Every decision making process produces a final choice (Wikipedia, The free encyclopedia). The success of a decision making model will depend on asking the right question and implementing the appropriate conclusion. Management decision is either made by managers, teams or individual employees depending on the setup of the organization.

"You can tell whether a man in clever by his answers. You can tell whether a man is wise by his questions." (Naguib Mahfouz)

There are different stages involved in the process of making a decision (Management chapter 9 pg 211) which are stated below -

a) Identifying and Diagnosing a problem

b)Generating alternative solutions

c)Evaluating alternatives

d) Selecting the best alternative

e) Implementing the decision

f) Evaluating the decision

By following the above mentioned steps well researched alternative solutions can be thought of and implemented.

Characteristics of Management Making Models

The different decision making models are -

Programmability

It refers to identification of a problem and searching for the established routines and procedures for resolving it. For e.g., While working as a Special Educator I would on certain occasions have to teach a student who was not in my class. The learning capacity and teaching method for each special needs child differs hence, teaching on a short notice can prove to be a problem if course syllabus is not known. In order to take a decision on the teaching aid and syllabus to be used the students file can be referred to wherein all information is recorded. Hence, solving the problem. However, when a situation is unique and there is no information available then a non-programmed decision is made. For e.g., when a new student is admitted to the school then there is no information available on teaching method, curriculum. Information is gathered by conducting educational tests on the student to understand cognitive functioning level based on which a curriculum is built and implemented.

Non-programmed decisions are more important as they have a direct impact on the organization's performance. In the above mentioned example an error in assessment of the student could lead to making an incorrect evaluation which would hinder the students development.

Uncertainty

It refers to the condition where incomplete information is available and must be used to make a management decision. For e.g., Our organization wanted to invest some money in mutual funds. A particular fund was selected which even though was new but, according to financial advisors the scheme was a good one to invest in. However, market trends keep changing and investment in only this particular scheme would be a concentrated risk. Based on the financial advise a decision was taken to invest in that mutual fund.

Risk

It is the degree of uncertainty in the outcome of a management decision. Both the positive as well as the negative outcome needs to be managed. For e.g., stating the example mentioned in the uncertainty decision making model the mutual fund scheme in which money was invested was both a high risk and high gain scheme. The positive outcome was if the market went up it would lead to high gain at the same time if the market crashed then substantial amount of money would be lost. Hence, in order to manage the negative outcome money was invested in multiple schemes and funds to spread the risk.

Conflict

Conflict arises in management decision making when there are limited resources available and the goals of the people directly affected by the decision are opposed to each other. Management of conflict involves consideration of various perceptions of the people to be affected in finding the right conclusion. For e.g., The financial department announced that the organization had crossed their financial target and were to open ideas of spending surplus money.The administration department of my organization wanted to renovate