DECISION MAKING PROCESS

Meltem Şanlı Meltem Şanlı Dokuz Eylül UniversityDokuz Eylül University

Industrial Engineering DepartmentIndustrial Engineering Department

WHAT IS DECISION MAKING PROCESS ?

Decision making, can be regarded can be regarded as the mental processes resulting in as the mental processes resulting in the selection of a course of action the selection of a course of action among several alternativesamong several alternatives..

STEPS OF DECISION MAKING

Step 1: IDENTFY THE PROBLEMStep 1: IDENTFY THE PROBLEM

The decision maker must answer The decision maker must answer these questions: ‘What is exactly these questions: ‘What is exactly the problem to be solved? Why it the problem to be solved? Why it should be solved?’ The decision should be solved?’ The decision maker should understand the maker should understand the problem to problem to achieve the achieve the correct correct decisiondecision..

SSteptep 2: RESEARCHING INFORMATION 2: RESEARCHING INFORMATIONIf the decision maker collectIf the decision maker collects s accurate and reliable information accurate and reliable information then then this this will will be be of great help in of great help in solving the problemsolving the problem.

SSteptep 3: GENERATE ALTERNATIVES 3: GENERATE ALTERNATIVES

Problem-solving and decision-Problem-solving and decision-making are closely linked, and each making are closely linked, and each requires creativity in identifying and requires creativity in identifying and developing options, for which the developing options, for which the brainstorming technique is brainstorming technique is especiallyespecially usefuluseful..

SSteptep 4: EVULATION OF ALTERNAT 4: EVULATION OF ALTERNATIIVESVES

The decision maker useThe decision maker usess standards standards and judgement criteria to determine and judgement criteria to determine the cons and pros of each the cons and pros of each alternative. Matrix and SWOT alternative. Matrix and SWOT Analysis Methods can be used on Analysis Methods can be used on decision making processdecision making process.

SSteptep 5: DECIDE ON IMPLEMENTATION 5: DECIDE ON IMPLEMENTATION

This is much easier after This is much easier after going going through the above preparation through the above preparation steps. If the decision makers are steps. If the decision makers are satisfied with alternatives, they will satisfied with alternatives, they will implement implement thethe cho chosensen alternative alternative for for the the solution of solution of the the problemproblem..

SSteptep 6: FOLLOW UP ON THE DECISION 6: FOLLOW UP ON THE DECISIONOnce Once thethe decision has been taken, decision has been taken, the decision maker must follow up the decision maker must follow up on the decision to see if it is working on the decision to see if it is working successfully. If the successfully. If the iimplementation mplementation has not produced the correct has not produced the correct solution, the decision maker must solution, the decision maker must go overgo over the other steps again the other steps again.

STEPS OF DECISION MAKING

IMPORTANCE OF DECISION MAKING

Decision-making makes it possible Decision-making makes it possible to adopt the best course of action in to adopt the best course of action in carrying out a given task. When there carrying out a given task. When there are different ways of performing a are different ways of performing a task, it becomes necessary to find task, it becomes necessary to find out the best way and that is what out the best way and that is what decision-making is all about. The decision-making is all about. The course of action finally selected course of action finally selected should produce the best resultsshould produce the best results..

Decision-making helps to find a Decision-making helps to find a solution to any problem in a work solution to any problem in a work placeplace and and to identify the best to identify the best course of action in each given course of action in each given situation and theresituation and there by promotes by promotes efficiency.efficiency.

TYPES OF BUSINESS DECISIONS

Programmed Decisions:Programmed Decisions: These are These are standard decisions which always standard decisions which always follow the same routine. As such, follow the same routine. As such, they can be written down into a they can be written down into a series of fixed steps which anyone series of fixed steps which anyone can follow. can follow.

Non-Programmed DecisionsNon-Programmed Decisions: : These These are non-standard and non-routine. are non-standard and non-routine. Each decision is not quite the same Each decision is not quite the same as any previous decision.as any previous decision.

Strategic DecisionsStrategic Decisions:: These affect the These affect the long-term direction of the business, long-term direction of the business, whether to take over Company A or whether to take over Company A or Company BCompany B..

Tactical DecisionsTactical Decisions:: These are These are medium-term decisions about how medium-term decisions about how to implement strategy, what kind of to implement strategy, what kind of marketing to have, or how many marketing to have, or how many extra staff to recruitextra staff to recruit..

Operational DecisionsOperational Decisions:: These are These are short-term decisions (also called short-term decisions (also called administrative decisions) about how administrative decisions) about how to implement the tactics, which firm to implement the tactics, which firm useusess to make deliveries to make deliveries

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