Decision Making

 

Koontz, Weihrich 

 

1. Nature and Purpose

2. Principles

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Meaning - ‘Selection of a course of action from among alternatives’

 

  1. Core of planning: - commitment of resources, direction, reputation – other wise it just studies, analysis etc.
  2. Managers’ central job – choosing – what, who, when, where, how
  3. Part of every day life
  4. Not judged alone – geared to other plans
  5. Systematic research and analysis – preceding a Decision

 

Techniques of D M

 

    1. Situations –     1. Decision making under Certainty

2. Decision making under Uncertainty

3. Decision making under Risk

 

    1. Styles –           1. Individual Decisions – Autocratic Decisions

            2. Consultative Decisions – Participative Decisions

            3. Group Decisions – Democratic Decisions

 

 

    1. Forms -            1. Structured Decisions

            2. Unstructured Decisions

 

Tools for Decision making

  1. Habit
  2. Standard Procedures
  3. Policies
  4. Organisational Structure
  5. Knowledge
  6. Experience

Sources to collect data for sound Decision

 

1.      Institutions

2.      Experience

3.      Considered Opinions

4.      Facts

5.      Quantitative Decision making Tools – mathematical & statistical techniques, Operational research, probability theory

 

Decision Making Strategies

 

1.      Situation

·         Certainty

·         Uncertainty

·         Risk

 

2.      Styles

·         Individual Decisions – Autocratic Decisions

·         Consultative Decisions – Participative Decisions

·         Group Decisions – Democratic Decisions

 

3.      Forms -

·         Structured Decisions

·         Unstructured Decisions

 

 

Ethics in DM

 

Consequence of action

 

ü  Any guise –mutual satisfaction necessary – win-win situation – unpleasant surprises lead to disaster

ü  Better to choose path of reason, truth, morality

ü  Therefore need norms to guide – make choices

Saint Thomas “choice lies at the center of the ethical behaviour”

 

Choice not difficult for:

ü  socio-paths, saints, criminals or– in extreme form

ü  easy if green /red /amber signals are available – [dilemmas, ambiguity, predicament – unpleasant, embarrassing]

ü  Safe and secure in peace – harmony – progress [of self and others]

ü  Dilemmas – if equal, undesirable – alternatives are on offer – lesser evil jobs

ü  Help to make right choice comes from:

·         Values: [moral demands] subject to change our views

·         Believes: things we take to be true and treat them as facts – social demands

·         Perceptions: ‘attributing meaning to what we see’ the interpretation of situation /incidence / happening.

‘Interplay between present situation and past experience – supplemented by theories.’

Part of our conscious assessment of the situation – other related information, facts, anecdotes are vital part of perception –

·         Feelings: - 6th sense / gut feelings – of great help, if developed by going through the process – not uncontrolled /unmanaged / raw –

 

Therefore better to be guided by appropriate norms / rules – especially for situations with ethical overtone – e.g. decisions on H R , Marketing [advertisements] etc.

Unexamined personal life is not worth living so also unexamined work life is not worth working.

 

Qualities – to handle the responsibility: to be identified and developed – in individuals, organisations

  1. Competence: Actual and perceived – physical, mental, spiritual, emotional, circumstantial – to recognize ethical issues – identify stakeholders
  2. Self-confidence: to seek different view-points [considering people will have vested interest in expressing their views] decide right / wrong answer – at a given time, place, in a particular set of relationship and circumstances

 

  1. Tough mindedness -
  2. Have to execute it

 

Human life at work place is impossible without –

  1. Observing certain norms, rules – norms are accepted practices, code of conduct – are very effective if supplemented by individual capabilities – Rules – have force of law  
  2. Consistently applying them
  3. Our own and others actions – considered
  4. Within the same social group

 

Ethical Decision would be:

  1. Right
  2. Good and Proper
  3. Equitable – just and fair