Decision making is a process of selection form a set of alternative courses of action which is thought to fulfil the objectives of the decision problem more satisfactory than others.
Elements of Decision making:
a. the decision maker
b. decision problem
c. environment in which decision is to be made.
d. objective of decision maker
e. alternative course of action
f. outcomes expected from variorums alternatives.
g. final choice of the alternative.
Characteristics of Decision Making:
o process of choosing course of action among various alternatives
o human process involving application of intellectual abilities.
o end process preceded by deliberation and reasoning
o related to environment
o involves time dimension and time lag
o always has a purpose
o involves actions like deciding, analysing and choosing.
TYPES OF DECISION MAKING:
· Routine and strategic
· policy and operating
· programmed and non programmed
· individual and group decision
Significance:
o essential part
o essence of managing
o decision making and planning are interlinked
o blend of thinking,deciding and action
Process of Decision making:
1. Diagnosing and defining the problem
2. analysing the problem
3. Collection of data
4. Developing alternatives
5. review of key factors
6. selecting the best alternative
7. putting the decision into practice
8. follow up
Techniques in Decision making:
a. Marginal cost analysis
b. cost benefit analysis
c. operations research
d. linear programming
network analysis
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