Matakuliah : J0562 / Management
Tahun : 2010

Student should be able to explain
The decision making process, the manager
As decision maker -> C3

• The Decision Making Process
• The Manager as Decision Maker
• Decision Making for Today’ World

The Decision Making Process a) Identification of a problem b) Identification of Decision Creteria c) Alocation of Weights to Creteria d) Development of Alternatives e) Analysis of Alternatives f) Selection of an Alternatives g) Implementation of the Altrnatives h) Evaluation of Decision Effectiveness

Decision
Choice from two or more alternatives
Decision-making
Decision-making Process
A set of eight steps that include identifying a problem, selecting an alternatives, and evaluating the decision’s effectiveness
Problem
A discrepancy between an existing and a desired state of affairs
A decision-making process begins with the existence of a problem

Step 1 : identifying a
Problem step 2 :identifying decision criteria step 3 : allocation weights to creteria step 4 : developing alternatives step 5 : analyzing alternatives step 6 : selecting an alternative step 7 : implementing the alternative step 8 : evaluating decision effectiveness
My sales reps need new computers!
•
Memory and storage
• Display quality
•
Battery life
• Warranty
• Carrying weight
Toshiba , HP, Sony, Dell, Apple, lenovo
8
4
10
3
6
Assessed values of laptop computers using decision criteria and next evaluation of laptop alternatives against weighted creteria
Toshiba *
Toshiba
Evaluation

The Manager as Decision Maker
Planning
• what are the organization’s long term objectives ?
• What strategies will best achive those objectives ?
• What should the organization’s short term objectives be ?
•
How difficult should individual goals be?
Leading
•
How do I handle employees who appear to be low in motivation ?
• What is the most effective leadeership style in a given situation ?
•
How will a specific change affect worker productivity ?
•
When is the right time to stimulate conflict ?
Organizing
•
How many employees should I have report directly to me ?
• How much centralization should there be in the organization ?
•
How should jobs be designed ?
• When should the organization implement a different structure ?
Controlling
•
What activity in the oganization need to be controlled ?
• How should those activities be controlled ?
•
When is a performance deviation significant ?
•
What type of maangement information system should the organization have ?

Rational decision making
Decision making behavior where choices are consistent and value maximizing within specified constraints
Bounded rationality
Decision making behavior that’s rational, but limited
(bounded) by an individual’s ability to process information

Sub conscious mental processing
Values or ethics based decisions
Intuituion
Experience based decisions
Cognitive based decisions
Affect initiated decisions

• Certainty
A situation in which a manager can make accurate decisions because all outcomes are known
• Risk
A situation in which the decision maker is able to estimate the likehood of certain outcomes
• Uncertainty
A situation in which a decision maker has neither certainty nor reasonable probability estimates available

analytic conceptual directive behavior

Decision making biases and errors hindsight overconfi dence Immediat e gratificati on
Selfserving
Anchorin g effect
Sunk costs
Decision making error and biases
Selective perceptio n randomn ess confirmat ion represen tation availabilt y framing

• Understand cultural differences
• Know when it’s time to call quits
• Do use an effective decision making process