Prepared by

Mr: Fathi Saad

Problems solving and Decisions

making
for 3rd year students
Problem solving

Lecture Outline and Line Art Presentation, 6–2

 Problem solving
• Organization success depends on decision
made at right time and solving problems.

• Managers should make decisions about both

problems (undesirable situations) and
opportunities (desirable situations).

• Problem solving is a set of activities designed

to analyze a situation systematically and
generate, implement and evaluate solutions.
Lecture Outline and Line Art Presentation, 6–3
The relationship between problem
solving and decision making

Lecture Outline and Line Art Presentation, 6–4

 Problem solving process
• Rational problem solving process
compromises of the following steps:

1) Problem awareness.

2)Defining the problem.

3)Identifying the root causes of the problem.

4)Generating alternative solutions.

5)Selecting appropriate solution (making a

decision).

6)Decision implementation. Lecture Outline and Line Art Presentation, 6–5

 Problem solving process
1)Problem awareness

 There are three situations to determine the

possibility of problem existence or noted:

1.If there is a deviation from a set plan.

2.If there is a deviation from past experience.

3.If the competitors outperform the

organization.
Lecture Outline and Line Art Presentation, 6–6
 Problem solving process
2) Defining the problem
 The problem can be defined and recognized by analyzing the
situation and looking to the gap or difference between the
current conditions and the future conditions.

 Defining the problem is begging with asking the right

questions.

3) Identifying the root causes of the problem

 Collecting and analyzing data is important to confirm that

problem is real by looking to symptoms and the root causes
of the problem and agree with others on these causes to be
treated. Lecture Outline and Line Art Presentation, 6–7
 Problem solving process
4) Generating alternative solutions

 Solutions can be made via brainstorming and/or

scientific research methods.

 Creativity is important in this step and never stop

with only one solution.

Lecture Outline and Line Art Presentation, 6–8

 Problem solving process
5) Selecting appropriate solution (making a decision)

 This step comprises of selecting a particular course of

action that will either restore formerly acceptable
conditions or improve the situation in a significant way.
This step consist of:

1. Establish decision making criteria.

2. Develop alternatives.

3. Evaluate alternatives.

4. Deciding which alternative is a good one.

Lecture Outline and Line Art Presentation, 6–9
 Problem solving process
6) Decision implementation:
Decisions are little importance unless the are
effectively implemented.
Implementation of decisions should involves the
following steps:
1)Determining leadership roles and responsibilities.
2)Identifying human and financial resources
required.
3)Assign employee tasks and roles.
4)Establish work schedule.
5)Decide on a timeline for task completion.
Lecture Outline and Line Art Presentation, 6–10
 Problem solving skills
leaders should have importance skills to solve
problems they face:
9) Trust.
1)Teamwork.
10) Analytical ability.
2)Influencing ability.
11) Innovative.
3)Negotiation.
12) Adaptability.
4)Smile.
13) Flexibility.
5)Positive mindset.
14) Hardheadedness.
6)Patience.
15) Initiative.
7)Logic.
16) Transparency.
8)Intuition.

Lecture Outline and Line Art Presentation, 6–11

 Decision making
Decision making: is a mechanism for making choices among
alternatives at each step of the problem-solving process.

It is a mental process and part of problem-solving process.

Managers are responsible to make high quality decisions that

should be acceptable and executed in a timely fashion.

Decision is a judgment, a final word and solution of conflicts or

commitment to act in certain manner in the given
circumstances.

Characteristics of decisions: cohesive, conjectured,

contingent, flexible, improved, influencing, objective and non-
judgmental. Lecture Outline and Line Art Presentation, 6–12
 Decision making
Leaders often work under the critical conditions so they
need to decide quickly what actions to be taken.

If leaders delay or avoid making a decision, this

indecisiveness may create hesitancy, loss of confidence and
confusion within the organization which may lead to failure
of tasks.

Leaders need time to collect data and facts, and to weigh

various alternatives to decide which alternative is a good
one. Moreover, they still need more time to carry out a
decision and judge whether the decision was good or bad.
It is very difficult to isolate the effect of Lecture
anyOutline
single
and Line Art decision.
Presentation, 6–13
 Decision making process
The following procedures should be followed to
reach correct decisions:

1)Setting objectives.

2)Defining the problem.

3)Analyzing the problem.

4)Developing alternatives.

5)Selecting the best alternative.

6)Implementation the decision.

7)Follow up the decision.

Lecture Outline and Line Art Presentation, 6–14
 Decision making process
1) Setting objectives: the first step in the rational decision
making process is determining the objectives which are
the criteria by which final outcome is to be measured.

2) Defining the problem: many of wrong decision are

made because leaders doesn’t have a good grasp of the
problem.

 Practically, no problem ever presents itself in a manner

that an immediate decision may be taken, therefore
sufficient time and effort should be spent on defining the
problem before taken any decision.
Lecture Outline and Line Art Presentation, 6–15
 Decision making process
3) Analyzing the problem: after defining it, the problem
should by thoroughly analyzed to find out adequate
background information and data relating to the situation.

The problem should be divided into many sub-problems and

each element of the problem must be investigated
thoroughly and systematically.

Problems often involve number of factors, some of which

are pertinent that should discuss first and in depth to save
time, money as well as effort, and others are remote.

Lecture Outline and Line Art Presentation, 6–16

 Decision making process
4) Developing alternatives: Leaders need to develop
alternative courses of action through various assumptions
come to their minds, which bring them to the conscious
level.

Development of alternative cannot provide a leaders with

the imagination which they lack, but most of leaders have
more imagination than they generally use.

Development of alternatives is no guarantee of finding

the best decision, but it helps in weighing one alternative
against others, thus, minimizing uncertainties.
Lecture Outline and Line Art Presentation, 6–17
 Decision making process
5) Selecting the best alternative:

After developing alternatives leaders will have to evaluate all the

possible alternatives in order to select the best one.

The first common method to evaluate alternatives is through

intuition. i.e. “ use manager’s intuition to choose a solution that
seems to be good at that time”. It is not an accurate method
because a manager’s intuition may be wrong in several
occasions.

The second method is to compare the consequences of one

against others and choosing the alternative that has less
consequences.
Lecture Outline and Line Art Presentation, 6–18
 The criteria to compare consequences of
alternatives

There are four criteria to compare the consequences

of various alternatives:

1)Risk:

A manger should weigh the risk of each course of

action against the expected gains.

2)Economy of effort:

Managers should choose the alternative that mobilize

the resources for the achievement of results with the
minimum of efforts.
Lecture Outline and Line Art Presentation, 6–19
 The criteria to compare consequences of
alternatives

3) Situation:

 The choice of alternative depends upon the situation

prevailing at a particular point of time. If a situation has
great urgency, the preferable alternative is one that alarms
the organization that something important is happening.

4) Limitation of resources:

 In choosing among alternatives managers should focus on

factors that will save resources, this step in decision
making should be never ending.

Lecture Outline and Line Art Presentation, 6–20

 The common basses to select best
alternative
Decisions are selected via: experience, experimentation or
research.

Managers can give more reliance to past experience in case of

routine decisions, but they should not rely on the past
experience in case of strategic decisions.

Under experimentation, managers should test the decision

under actual conditions. For example; managers can test a
new medical product or equipment before they decide to sign
a contract.

Research help managers to search the relationships among

Lecture Outline and Line Art Presentation, 6–21
 Decision making process
6)Implementation the decision:
Managers are not only concerned with taking decisions, but
also with its implementation in a specific time.

They should try to ensure that systematic steps are taken to

implement the decisions.

The main problem which managers may face at the

implementation stage is the resistance by the subordinates.

In order to make subordinates committed to the decision,

they should be allowed to participate in the decision making
process.
Lecture Outline and Line Art Presentation, 6–22
 Decision making process
In order to make a decision acceptable, it is necessary for
manager to make people understand what the decision
involves, what is expected to them and what they expect from
the management.

The managers who discuss problems with their subordinates

and give them opportunities to ask questions and make
suggestions find more support for their decisions than others.

The area where the subordinate should participate in decision

making process is “the development of alternatives stage”.

Lecture Outline and Line Art Presentation, 6–23

 Decision making process
7) follow-up the decision:

It is always better for managers to check the results after

putting the decision into practice.

The main reasons for following up decisions are:

1.If the decision was good, manager will repeat it if he/she

faces the same problem in the future.

2.If the decision was bad, manager will not repeat it next
time.

3.If the decision was bad and manager follow up soon

enough, corrective action may still be possible.
Lecture Outline and Line Art Presentation, 6–24
 Types of decisions
1) Programmed decisions: They are routine and repetitive
decisions and do not need extraordinary judgment and
analysis, therefore a problem may not be treated as an
unique case each time it arises.

2) Non programmed decisions: They are non-repetitive,

know as “strategic decisions”, occur less than
programmed decisions and need extraordinary judgment
and analysis, so that they are handled by general problem
solving process.

 Intuition, experience, experimentation and research are

major factors in making this type of decisions.
Lecture Outline and Line Art Presentation, 6–25
 Types of decisions
3) Policy decisions:

They are decisions pertaining to the policy and planning of the

organization and usually taken by the top-level managers.

They have a long term impact on the firm and require a great
deal of analysis.

4) Operating decisions:

They are the decisions necessary to implement the policy

decisions which are taken by the top-level managers.

• Such decisions are usually taken by middle and lower

management.
Lecture Outline and Line Art Presentation, 6–26
 Barriers to good decision making
1) fuzzy: it means lack of clarity on important aspects
of a decision that may causes to overlook certain
important considerations.

2) Hasty: it means make a quick decision without

having much thought.

3) Narrow: it means a decision making based on very

limited information.

4) Scattered: it meant the thoughts in making a

decision is disconnected or disorganized.
Lecture Outline and Line Art Presentation, 6–27