Chapter 09 Managerial Decision Making

Types of Decisions

• Programmed decisions:
• situations that occur often enough to enable decision rules to be developed.
• Nonprogrammed decisions:
• are made in response to situations that are unique, are poorly defined and largely unstructured.
• many involve strategic planning.

• Decision making the process of identifying problems and opportunities, then resolving them.

Programmed and Nonprogrammed Decision Differences

• Certainty
• all the information the decision maker needs is fully available.
• Risk
• decision has clear-cut goals.
• good information is available.
• future outcomes associated with each alternative are subject to chance.

Programmed and Nonprogrammed Decision Differences

• Uncertainty
• managers know which goals they with to achieve.
• information about alternatives and future events is incomplete.
• managers may have to come up with creative approaches to alternatives.
• Ambiguity
• by far the most difficult decision situation.
• goals to be achieved or the problem to be solved is unclear.
• alternatives are difficult to define.
• information about outcomes is unavailable.

Conditions that Affect the Possibility of Decision Failure

• Organizational
• Problem

• Problem
• Solution

• Low

• High

• Possibility of Failure

• Certainty

• Risk

• Uncertainty

• Ambiguity

• Programmed
• Decisions

• Nonprogrammed
• Decisions

To avoid mistakes, you should adhere to the following rules:

• To avoid mistakes, you should adhere to the following rules:
• - to ensure the compliance of each task with the business and psychological characteristics of the performer, taking into account the professional skill of the employee;
• -distribute tasks in such a way as to stimulate collectivist feelings;
• - to ensure mutual trust of the performers of the common task;
• - to provide mutual safety net and mutual assistance of people working together;
• -mobilize the team to complete tasks.