MANAGERIAL DECISION MAKING

Date: 2015-10-07; view: 376.

A manager is responsible for the men, machines, materials, and methods of disposal. These are resources he/she uses to reach the objectives. And in determining how to use them, a manager must constantly make decisions.

A decision always involves a choice among alternatives. A real decision is required when there's some uncertainty about choosing one course rather than another – when the manager can't really be sure that it is better to decide one way rather than another. Thus true decision-making involves some degree of risk.

Perhaps some people find it hard to make decisions. They are afraid of making the wrong decision, and the result is they let things slide whenever they can. They are really make the “decision not to decide”. And the decision “not to decide” may be as risky as the decision to act – for if a problem is ignored, it may become more serious than it was at first.

Decision-making and problem-solving involves much more than the final choice among possible courses of action. It involves detecting the occasions for decision – the problems that have to be dealt with. It involves developing possible problem solutions – course of action – among which the final choice can be made. Discovering and defining problems, elaborating coursers of action and making final choices are all stages in the decision-making process.

When the term “decision-making” is used, we generally think of the third stage, but the first two account for many more man-hours of effort in organizations than the third. Decision-making defined in this broad way, constitutes the bulk of managerial activity.