What you are going to learn?

• 1. What is Decision making in management?

o 1.1. Types of decision making
▪ 1.1.2. 1. Programmed and non-programmed
decision
▪ 1.1.3. 2. Major and minor decision
▪ 1.1.4. 3. Routine and strategic decisions
▪ 1.1.5. 4. Organizational and Personal decision
▪ 1.1.6. 5. Individual and group decision
▪
▪ 1.1.7. 6. policy and operative decisions
▪ 1.1.8. 7. Long term, departmental and non-
economic decision
o 1.2. Importance of decision making
o 1.3. Decision-making techniques
o 1.4. Decision Making Process
▪ 1.4.1. Step 1: Identify the Decision
▪ 1.4.2. Step 2: Gather relevant information
▪ 1.4.3. Step 3: Identify the alternatives
▪ 1.4.4. Step 4: Weigh the evidence
▪ 1.4.5. Step 5: Take action
▪ 1.4.6. Step 6: Review your decision
o 1.5. Download Decision-Making PDF
o 1.6. Skills needed for Decision-making
▪ 1.6.1. Problem-solving skill
▪ 1.6.2. Collaboration skill
▪ 1.6.3. Emotional intelligence
▪ 1.6.4. Logical reasoning
▪ 1.6.5. Time management
▪ 1.6.6. Leadership skill
▪ 1.6.7. Ethics
▪ 1.6.8. Research and analysis
▪ 1.6.9. Flexibility
o 1.7. Decision Making Examples
CHAPTER 1.
• What is Decision making in Management?

Decision making is the judgment of the process by which one can

choose between a number of alternative courses of action for the
purpose of achieving goals.

Managerial decision making is synonymous with the whole

process of management. It decides, what should be done? how
should it be done? when and by whom should be done?

A decision may also be conceived as a conclusion that a manager

has reached so as to know what he should do later on. It calls for
both judgmental and imagination activity to select one from many
alternatives, so decision making is an intellectual activity.

CHAPTER 2.
Types of decision making.

There are many types of decision making. Some of the

Importance types are: -
1. Programmed and non-programmed decision.
2. Major and minor decision.
3. Routine and strategic decision.
4. Organizational and personal decision.
5. Individual and group decision.
6. Policy and operational decision.
7. Long-term, departmental, and non-economic decision.
Let’s elaborate on each type of decision making-

. Programmed and non-programmed decision

Programmed decisions :- are those, which are in
accordance with some habits, rules, or procedures. Every
organization has its own policies that simplify decision making.

For example, we would not worry about deciding the salary of a

new employee, the organization generally has established a
salary scale for all positions.

Of course, programmed decisions are limiting our freedom to

some extent, because organization rather than an individual
decides what to do.

However, the policies, rules, and procedures by which we make

decisions free us to think about other new solutions. thus, help us
to devote attention to other, and more important activities.

Non-programmed:- decisions are those that deal with

unusual problems. If the problem such as it did not come up often
enough cover by policy or it is so important that needs special
treatment, it is taken care of by non-programmed decision.
Some of the non-programmed decisions are –
• How to allocate an organization’s resources.
• What to do about failing product line.
 • How community relations should be improved will usually
require non-programmed decisions.

CHAPTER 3.

. Major and minor decision

Making the decision to purchase expensive equipment, such as

purchasing a CNC is considered a major decision.
The purchase of cheap equipment like a few reams of typing
paper is a minor decision.

CHAPTER 4.
. Routine and strategic decisions

Routine decisions :- are slightly similar to programmed

decision making. Routine decisions are repetitive in nature, do not
need any analysis and evaluation, are in the context of day-to-day
operations of the enterprise, and can be made by middle
management level.

Example: Sending a sample to a government investigation center.

A strategic decision :- is related to the policy of the

organization, are taken by high levels of management, it involves
a large expenditure of fund. A slight mistake in decision making is
injurious to the enterprise.

Example: capital expenditure decision, decision-related to pricing,

etc.

CHAPTER 5.
. Organizational and Personal decision

A manager makes organizational decisions on behalf of

a company’s officer. This type of decision reflects the policy of the
organization.

Personal decisions are the manager’s individual decision,

and not as a member of the organization.

CHAPTER 6.
. Individual and group decision

Individual decisions:- are taken by a single individual in

the context of routine decisions according to the guideline of the
organization.
Group decisions:- are taken by conducting committee
meetings for any specific purpose. Such decisions are very
important for the organization.

CHAPTER 7.

. policy and operative decisions

Policy decisions:- are critical, so they are taken by top

management, it makes a long-term impact, and mostly related to
basic policies.

operative decision:- related to day-to-day operations of

the enterprise and taken by low-level management.

CHAPTER 8.
. Long term, departmental and non-economic
decision.

.Long term decisions:- are taken for a longer time period

and the risk involves is high.
.Departmental decisions:- are taken by the
departmental head, related to a particular department.
.Non-economic decision:- is related to factors such as
technical values, moral behavior, etc.
 CHAPTER 9.

.Importance of decision making

• It is required to supply financial, technical, and other

information as input to help decision making at a higher
management level for achieving maximum profit.

• Decisions are generally made to fulfil the objectives of the

organization.

• In business, whatever the business is small or big, changes

in condition take place, shifts in personal occur, unforeseen
contingencies arise. Moreover, just to get started, and keep
them moving, decisions must be made.

• Every aspect of the management (planning, organizing,

control, etc.) determines by decision making.

• Decision making is important for all management activities. It

helps to set objectives, prepare plans of action, determine
the organizational structure, motivate employees to be more
productive, and introduce innovations.

. Decision-making techniques

Type of decision making Traditional Technique Modern Technique

1. Programmed:
Routine, repetitive decisions, an (i) Operation research,
organization develops a specific process for mathematical analysis,
handling them. (i) Based on habit models, computer simulation.
 (ii) critical routine (ii) Data processing.
standard operating
procedure.
(iii) organization
structure.

(i) Judgment, intuition,

and creativity.
(i) Training human decision-
2. Non-programmed: (ii) Rule of thumb. makers.
Non-routine, one-shot, ill-structured, novel
policy decisions handled by the general (iii) selection and (ii) Constructing heuristic
problem-solving process. training of executives. computer Programs.

Decision Making Examples

Below are some real-world examples of decision making.

• Choosing which manufacturer to supply the

product you sell: - In this case, you have to analyze all
manufacturer’s offers and choose which one is meeting your
expectations.

• Choosing a name for a:- new product. You need to

discuss with your team and decide a name most suited for
the product.

• Comparing different candidates for a job opening or

promotion. Evaluation and analytical skills will help you to
find out the best candidate depending on the job description
and the qualifications of the candidate.

• Deciding the best way to boost sales. You’ll need good

evaluation, analysis, and creative.
 CHAPTER 10.

. WHAT ARE ANALYTICAL SKILLS?

CHAPTER 11.

WHAT ARE THE SKILLS FOR MARKETING?

• skills, to think of the best marketing strategy to
drive sales.

CHAPTER 12.

DECIDING BONUSES AND BENEFIT.

• Deciding how much bonuses will be given for

the year. Strong analytical, financial, and
reasoning skills are necessary to make a
decision like this.