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attitudes and value judgements to bear on the decision process.  ! Programmed decisions are those that are made in accordance with some policy. In the case of non-programmed decisions. It is possible for two managers to arrive at distinctly different solutions to the same probl em. each claiming that he is acting rationally. since each manager may bring his own personal beliefs. rule or procedure so that they do not have to be handled de navo each time they occur. "" c%  c  .

Thus the decision to shift from bound ledger to loose leaf ledger may be made by the accountant himself si nce it affects no one except his department. like replacement of men by machinery or diversification of the existing product lines must be rated as a very major decision. c) Qualitative factors that enter the decision ± A decision which involves certain subjective factors is an important decision. """ &     .A decision which has a long -range impact.Decision which are rare and have no precedents a s guides may be regarded as major decisions and may have to be made at a high level.  ! a) Degree of Purity of Decision . b) Impact of the decision on other functional areas .If a decision affects only one function it is a minor decision. d) Recurrrance of decisions .

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Routine.   . "'"     (  . tactical or housekeeping decisions are those which are supportive of rather than central to the company¶s operations.

2) the bounded rationally model or the administrative man. e) Measuring and comparing the consequences of alternative solutions. The three models are: 1) the econologic model or the economic man. c)* )+ . You will notice that each model differs on the assumptions it makes about the person or persons making the decision. Steps in rational decision making: a) Recognising the problem b) Deciding priorities among problems. d) Developing alternative solutions or courses of action. / .   ." ")$ c-."$( #&). c) Diagonosing the problem. when they are many the decision is com plex. f) Converting the decision into effective action and follow up action. the decision is simple.when variables to be considered for solving a problem are few. Simple and complex Decisions . and 3) the implicit favorit e model or the gamesman.Decisions may be taken either by an individual or by a group.

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If you look closely in this prescriptive model you shall be able to recognize some of the assumptions it makes about the capabilities of human beings. It is also assumed that they go about this search in a planned. Develop a criterion against which alternative solutions can be evaluated. 5. When an . Identify all alternative courses of action. 4. they can accurately recall any information any time they like. Choose the best alternative by comparing the consequences of each alternative ( step 5) with the decision criterion 9step 3) and 7. one not bound by the above assumptions. Briefly. The concept of bounded rationality attempts to describe decision process in terms of here mechanisms: Sequential attention to alternative solut ion: People examine possible solutions to a problem sequentially. this model does not assume individual rationality in the decision process. people can manipulate all this information in a series of complex calculations design to provide expected values. If the first solution fails to work it is discarded and the next solution is considered. 6.. That is. while they may seek the best solution. / 0  &  c  -    c  An alternative model. Determine the goal to be achieved or define the problem to be solved 3. this model rests on two assumptions: (1) It assumes people are economically rational. orderly. Third. Instead of identifying all possible solutions and selecting the best as suggested in the econologic model). people can have complete information. people can mentally store this information in some stable form ie. First. people can rank the consequences in a consistent fashion for the purpose of identifying the preferred alterna tive. usually settle for much less because the decisions they confront typ9ically demand greater information processing capabilities than they possess. As the name impl ies.. has been presented by Simon. a basic concept in many models of decision -making. Instead. Consider the consequences of each alternatives as well as the likelihood of occurrence of each. but it does not adequately portray how decisions are actually made. the various alternatives are identified and evaluated one at a time. This is the bounded rationality model. Following are the steps in decision making process: 1. They seek a kind of bounded (or limited) rationality in decisions. Discover the symptoms of the problem or difficulty 2. and (2) that people attempt to maximize outcomes in an orderly and sequential process. it assumes that people. Act or implement the decision The economic man model represents a useful prescription of how decisions should be made. The econologic model represent the earliest attempt to model decision pro cess. exist when people attempt to maximize objectively measure advantage. Economic rationality. Second. such as money or units of goods produced. and Fourth. it is assumed that people will select the decision or course of action that has the greatest advantage or payoff from among the many alternatives. people have the capability to gather all necessary information for a decision ie. and logical fashion. also known as the administrative man model.

decision makers use heuristics to reduce large problems to manageable proportions so that decisions can be made rapidly. An alternative is satisfactory if (i) there exist a set of criteria that describes minimally satisfactory alternatives. good enough and not necessarily µthe best¶) solution is found. They look for obvious solutions or previous solutions that worked in similar situations. / " . Use of heuristics: A heuristic is a rule which guides the search for alternatives into areas that have a high probability for yielding satisfactory solutions. the search is discontinued.acceptable (that is. this model sees him or her as a satisfier. For instance. by these criteria. Satisfying: Whereas the econologic model focuses on the decision maker as an optimizer. some companies continually select management graduates from certain institutions because in the past such graduates have performed well for the company. An alternative is optimal if: 91) here exists a set of criteria that permits all alternatives to be compared: and (2) the alternative in question is preferred. and (2) the alternative in question meet s or exceeds all these criteria. to all other alternative. According to the bounded rationality model.

Finally after a decision rule was derived that clearly favoured the implicit favourite. the consequences of a particular decision cannot be specified with certainity but can be specified with known probability values. Programmed decisions.$ +)& 23 245 ()&6 .#*/ . This was done through perceptual distortion of information about the two alternatives and thorough weighing systems designed to highlight the pos itive features of the implicit favourite. 2) risk and 3) uncertainity. Certainity: The decision maker can specify the consequences of a particular decision or act. Risk: In decision making under the condition of risk. The non -programmed decisions are decisions that are novel or unstructured. The implicit favorite model developed by Soelberg (1967) emerged when he observed the job choice process of graduating business students and noted that. Uncertainity exists when the decision maker does not know the probabilities associated with the possible outcomes though he has been able to identify the possible outcomes and the related pay offs. Certainity about future events is difficult and managerial decisions must be made in awareness that future conditions may vary widely from those contemplated when the decision is being made. known as the confirmation candidate. Even so. )&(-$"12")$ 2-.2 *27(. in contrast. However. the decision was announced. the decision makers generally characterized their decision rules as being multi -dimensional nature. Uncertainity: More prevalent than either conditions of centainity or risk are conditions of uncertainity. are more routine or repetitious in nature. Soelberg noted that the implicit favourite was typically superior to the confirmation candidate on only or two dimensions. This environment may be of three types 1) certainity.  +  c ( c This model deals primarily with non -programmed decisions. Ironically.)$ 4c& #&)4. How it can be improved: These conditions of knowledge are often referred to as the environment of decision making. in many cases the students identified implicit factories very early in the recruiting and choice process. like seeking one¶s first job. they continued their search for addi tional alternatives and quickly selected the best alternative candidate. like the procedures for admitting students to a secondary school.

one of India's leading Fast Moving Consumer voods (F MCv) companies acquired (% ( c  +1 on October 1. Keyline operates in the toiletries a nd personal care sector. India's first Fairness soap. and its portfolio includes a number of important niche brands. (vCPL). Established in 1990 by Brian Boyce and Vicki Dryden Wyatt. The model is descriptive of how people i ntuitively make decisions and makes the steps explicit. vODREJ NO 1 . hair. . This is achieved through the brands the company markets.). not just ethics training. Aapri.P. some of which are household names such as Cuticura. vodrej Consumer Products Ltd. Erasmic and Nulon. Our FAIRvLOW brand. vodrej Consumer Products Ltd.P. We are supported in our endeavour by a state-of-the-art Research Centre based in Mumbai. We are among the largest marketer of toilet soaps in the country with leading brands such as CINTHOL . FAIRvLOW . We are the leader in the hair colour category in India and have a vast product range from vODREJ RENEW COLOURSOFT LIQUID HAIR COLOURS. value for money solutions for meeting their daily needs and improving the quality of their life. We are also the preferred supplier for contract manufacturing of toilet soaps be some of the most well-known brands in the country. Our focus is on providing our customers with innovative.  0 * was acquired by the vodrej vroup in October 2005. They selected a six step decision making process that synthesized the decision making models used in existing training. has created marketing history as one of the most succesful innovations. The company employs 950 people and has three state -of-the-art manufacturing facilities at Malanpur (M.(vCPL) is a major player in the Indian FMCv market with leadership in personal. household and fabric care segments. 2007. The six steps of this natural. vODREJ LIQUID & POWDER HAIR DYES to vODREJ KESH KALA OIL.) vuwahati (Assam) and Baddi ( H. NUPUR based Hair Dyes. intuitive decision -making process are: j Step 1: Define the problem j Step 2: Identify available alternative solutions to the problem j Step 3: Evaluate the identified alter natives j Step 4: Make the decision j Step 5: Implement the decision j Step 6: Evaluate the decision ‘    .

. This careful attention to definition in terms of outcomes allows one to clearly state the problem. This is a critical consideration because how one defines a problem determines how one defines causes and where one sear ches for solutions. In this way a problem is defined as the difference between expected and/or desired outcomes and actual outcomes.   The most significant step in any decision making process is describing why a decision is called for and identifying the most desired outcome(s) of the decision making process. One way of deciding if a problem exists is to couch the problem is terms of what one wanted or expected and the actual situation.

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  The key to this step is to not limit yourself to obvious alternatives or what has worked in the past but to be open to new and better alternatives. How many alternatives s hould you identify? Ideally. you should be looking at the likely positive and negative cones for each. ‘  . Realistically. all of them. either this or that. This gets away from the trap of seeing "both sides of the situation" and limiting one's alternatives to two opposing choices. It is unusual to find one alternative that would completely resolve the problem and is heads and shoulders better than all others. biases and predis positions. ‘         As you evaluate each alternative. we teach that the decision maker should consider more than five in most cases. relative and a function of the decision maker's personal perceptions. more than three at the barest minimum. Differences in the "value" of respective alternatives are typically small.

complete with a clear definit ion of the problem. ‘   .  When acting alone this is the natural next step after selecting the best alternative. When the decision maker is working in a team environment. a clear list of the alternatives that were considered and a clear rationale for the proposed solution. this is where a proposal is made to the team.

tangible step in changing the situation. As Lou verstner ( CEO of IBM) said. There are only prizes for building arks. The action itself is the first real." ‘   . It is not enough to think about it or talk about it or even decide to do it. it is necessary to make the point that deciding on the best alternative is not the same as doing something. A decision only counts when it is implemented. "There are no more prizes for predicting rain.  While this might seem obvious.

The final test of any decision is whether or not the problem was fixed. m .  Every decision is intended to fix a problem.