Foundations of Decision-Making

FoundationS of decision-MAKING

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TABLE OF CONTENT:

• INTRODUCTION

• DISCUSSION AND ANALYSIS

• CONCLUSION

• RECOMMENDATION

• REFERENCE

• BIBLIOGRAPHY

INTRODUCION

Implementation of any human activity related to the adoption of decisions that precede the relevant actions, even the simplest, taken by man (got up, took any subject and so on). As we can notice that the simple steps are often obvious and the time interval between the decision and its implementation is very small, the decision almost merges with the action and is not recognized as an independent.

The solution - a requirement for action to solve the problem. The decision - the choice of a particular action of a variety of options (alternatives). In the simplest case, it is a choice of two alternatives: to act or not to act. Managerial work necessarily associated with decision-making. The need for solutions permeates all actions of the head of management of the organization, from the formulation of objectives to achieve them. Managers have to analyze multiple potential options for action in order to find the right. For an organization to work effectively, the manager must continuously implement the right choices from the options.

Decisions include for instance unimportant selection of newspapers, and a breakfast menu, and choose a place of work or life partner. And although there are many alternatives (tens of titles of newspapers or dishes), but almost all the daily decisions we make no systematic thinking through. Furthermore, such solutions usually do not affect the others.

The manager selects the course of action not only for themselves but also for the organization and other employees. Management decisions can greatly affect both the overall financial health of the organization and the lives of many people working in the organization and outside it. Therefore, a Manager, as a rule, cannot make wrong decisions.

If, in general, the decision - is the choice of one of the alternatives, the management decision - a choice that has to make the head in accordance with his position in order to ensure the fulfillment of the tasks of the organization.

         Factors influencing the decision-making process

• Personality assessment leader. Subjective opinion on priorities, the focus, for example on economic issues rather than social.
• Risk and uncertainty. Environmental Factors. Opportunities to reduce uncertainty: getting more information or to act in accordance with their experience.
• Time. Success did not come immediately.
• Cost information. The cost of the information should be blocked income from its use and implementation. More information - not necessarily better.
• Interconnection solutions. Systems approach  

  Decision making-process

Decision-making process - a cyclic sequence of the subject of management, aimed at resolving the problems of the organization lies in the analysis of the situation, the generation of alternatives, decision-making and the organization of its implementation.

The most complete and clear idea of the decision-making process will chart showing its main stages and their sequence.

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Consider the content of each of the basic procedures outage.

Analysis of the situation. An analysis of administrative situation requires the collection and processing of information. This stage performs the function of the perception of the organization of internal and external environment.

1. Identification problem. The first step in solving the problem - its definition and diagnosis, complete and correct. It is said that the right to formulate the problem - it means it is half solved.
2. Defining selection criteria. Before considering possible solutions to the problem, supervisor need to define indicators that will be the comparison of alternatives and choosing the best.
3. The development of alternatives. The next phase - development of a set of alternative solutions. Ideally, it is desirable to identify all possible alternative solutions to the problem, but in this case, the solution may be optimal.
4. Selection of an alternative. Develop possible solutions to the problem should be appreciated that compare the advantages and disadvantages of each alternative and objectively analyze the likely results of their implementation.
5. Matching solutions. In modern control systems as a result of the division of labor led to a situation in which the prepared, some workers develop solutions organization, accepts or approves - the other, and perform - the third.
6. Management implementation. For successful implementation of the solution, you must first determine the range of activities and resources, and distribute them to performers and terms, i.e. provide who, where, when and what actions should be taken and what resources are needed for this.
7. Monitoring and evaluation of results. At this stage, the measurement and evaluation of the effects of the decision or comparison of actual results with those leaders hoped to obtain.

Errors in decision-making.

At the heart of most of the errors are incorrect decisions. As a rule, two groups of factors that influence the decision: internal and external.

Inside: the factors associated with the personality of the person making the decision. This particular perception and information processing, personality traits, values and motivation.

 For example, here are the commitments of the obvious solutions, decision making on the basis of the expected information, based on past experience, risk taking, the delay in making a decision, the reassessment of the importance of information, revaluation investment of time and resources into making a decision.

External: the factors associated with the conditions of the decision (for example, limited time) and the influence of others.