INTRODUCTION

Decision-making is a mental process of selecting the best alternative for doing a work

DEFINITIONS
A decision is an act of choice-wherein an executive forms a
conclusion about what must be done in a given situation. A decision represents a course of behaviour chosen from a number of possible alternatives . -D.E. McFarland

A decision is a course of action which is consciously chosen for achieving a desired result. -Haynes and Massie

A decision in its simplest form is a selection of an alternative. - R.A.Killian

CHARACTERISITICS
1. 2. 3. 4. 5. An intellectual activity A process of selection An element of commitment Evaluation of alternatives Result-oriented

ELEMENTS
1.Concepts of a good decision 2.Environment of decision 3.Psychological elements 4.Timing of decisions 5.Communication of decisions 6.Participation of employees

STEPS INVOLVED
1.Setting objectives 2.Perception of the problem 3.Analyzing the problem 4.Developing alternative solutions 5.Screening the alternatives 6.Selecting the best solution 7.Implementing the decision 8.Feedback and Control

PRINCIPLES
1.Marginal theory of decision-making 2.Mathematical theories 3.Psychological theories 4.Principle of exceptions 5.Principle of alternatives 6.Principle of limiting factors 7.Principle of participation

Programmed and non programmed

Individual and group

TYPES

Basic and routine

Policy and operative

RATIONAL DECISIONMAKING
It is a process of problem-solving in a scientific , systematic ,objective and reasoned manner. It also implies an ability and willingness to positively respond to reason, to be logical, to coherently relate means with ends and to visualize the totality of the decision making environment- both immediate and long range.

QUANTITATIVE TECHNIQUES OF DECISION-MAKING

Operations Research(OR) is one of the most
important quantitative technique of decision making. It is the application of scientific methods; of the study of alternatives in a problematic situation, with a view to providing a quantitative basis for arriving at an optimum solution in terms of the goals. It uses highly sophisticated higher mathematics, computers and programming to achieve the desired results and is therefore often called management science.

MAIN TOOLS OF OR
1.Construction of decision models 2.Simulation 3.Linear programming 4.Probability theory 5.Game theory 6.Queuing theory/ Waiting line theory 7.Monte carlo method 8.Search theory 9.Other techniques: Value theory, Symbolic logic, etc

MANAGEMENT BY OBJECTIVES
It is a process whereby the employees and the superiors come together to identify common goals, the employees set their goals to be achieved, the standards to be taken as the criteria for measurement of their performance and contribution and deciding the course of action to be followed.

REASONS: WHY MBO SUCCEEDS?

1. Adequate unfreezing of inter-personal relationships 2. Emphasis on change 3. Acceptance of human side of an organization 4. Maximum information generated 5. Group emphasis, as opposed to individual emphasis 6. Effectiveness emphasis 7. Situational emphasis

REASONS: WHY MBO FAILS?

1. 2. 3. 4. Lack of commitment Top management not involved Poor implementation Little coaching or assistance to managers on procedures involved 5. No follow-up 6. Objectives handed over to subordinates 7. Creative goals stifled 8. Fuzzy top policy 9. Overemphasizing appraisal 10.Making it mechanical