01-06-2012, 12:25 PM
DECISION MAKING
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DECISION MAKING
Decision making is the life blood of every organization. It means selecting the best from different alternatives.
“ A decision is an act of choice wherein, an executive forms a conclusion about what must be done in a given situation”
TYPES OF DECISIONS
STRATEGIC AND TACTICAL DECISION
PROGRAMMED AND NON-PROGRAMMED DECISIONS.
ORGANIZATIONAL AND PERSONAL DECISIONS.
DECISIONS UNDER CERTAINITY, RISK AND UNCERTAINITY.
POLICY AND OPERATIVE DECISIONS.
STRATEGIC AND TACTICAL DECISIONS
STRATEGIC
Very crucial in nature
Generally related to policy matters
Concerned with allocation of resources and thereby attaining organizational goals
TACTICAL
Derived out of strategic decisions
Relate to day-to-day working
Taken by middle and lower level managers
PROGRAMMED AND NON PROGRAMMED DECISIONS
PROGRAMMED
Routine and repetitive in nature
Taken by middle or lower level managers
They have short term impact
NON PROGRAMMED
Just reverse to programmed decisions
Taken by top executives
Flexible
PRINCIPLES OF DECISION MAKING
Marginal Theory
Business undertaking works for earning profit
Decision making should be based on marginal analysis (law of diminishing returns)
Marginal principle effe