DECISION MAKING

&
IMPLEMENTATION
By
Prof.B.G.Varma
NICMAR’s - CISC
Hyderabad.
• Decision making is defined as selection of
course of action from among alternatives.
• Plans get translated into action only when
a decision-a commitment of resources ,
direction has been made.
• The main job of a manager is to make a
decisions on what to be done , who to do it
, and when, where and how it will be
done.
 Steps in decision making
process
• Premising.
(The anticipated environment in which
plans are expected to operate.)
• Identifying alternatives.
• Evaluating the alternatives
• Choosing an alternative(making decision)
(Alternatives are evaluated in terms of
quantitative and qualitative factors)
 Decision Making Techniques
• Marginal analysis
An examination of the additional benefits
of an activity compared to the additional
costs of that activity.
• Cost effective analysis
It is also called Cost Benefit Analysis.
It seeks the best ratio of benefits and
costs.
 Major features of CFA
• It focus on the results of the program.
• It helps weigh the potential benefits of
each alternative against its potential cost.
• It involves a comparison of the alternatives
in terms of the overall advantage.
• Experience
Experienced managers usually believe
that the things they have successfully
accomplished and the mistakes they have
made furnish guide lines to the future.
• Experimentation
• An obvious way to decide among
alternatives is to try one of them and see
what happens.
 A firm may test a new product in certain
market before expanding its nationwide.
• Research & analysis
• One of the most effective technique for
selecting from alternatives when major
decisions are involved is Research &
analysis. This approach means solving a
problem by first comprehending.
 Definition of 'Decision Tree'

• A schematic tree-shaped diagram used to

determine a course of action or show a
statistical probability.
• Each branch of the decision tree
represents a possible decision or
occurrence.
• The tree structure shows how one choice
leads to the next, and the use of branches
indicates that each option is mutually
exclusive.
• A decision tree can be used to clarify and find an
answer to a complex problem.
• The structure allows users to take a problem
with multiple possible solutions and display it in
a simple, easy-to-understand format that shows
the relationship between different events or
decisions.
• The furthest branches on the tree represent
possible end results.
 Drawing a Decision Tree

• You start a Decision Tree with a decision

that you need to make.
• Draw a small square to represent this
towards the left of a large piece of paper.
• From this box draw out lines towards the
right for each possible solution, and write
that solution along the line.
• Keep the lines apart as far as possible so
that you can expand your thoughts.
• At the end of each line, consider the results.
• If the result of taking that decision is uncertain,
draw a small circle.
• If the result is another decision that you need to
make, draw another square.
• Squares represent decisions, and circles
represent uncertain outcomes.
• Write the decision or factor above the square or
circle.
• If you have completed the solution at the end of
the line, just leave it blank.
• Starting from the new decision squares on your
diagram, draw out lines representing the options
that you could select.
• From the circles draw lines representing
possible outcomes.
• Again make a brief note on the line saying what
it means.
• Keep on doing this until you have drawn out as
many of the possible outcomes and decisions as
you can see leading on from the original
decisions.
 Decision Tree
• Decision Trees depicts in the form of a “
tree”, the decision points , chance events
and probabilities involved in various
courses.
• When a new product is
introduced,managers must decide whether
to install expensive permanent equipment
to ensure production at the lowest
possible cost or to undertake cheaper
• temporary tooling that will involve a higher
manufacturing cost but lower capital
investment and will result in lower losses if
the product does not sell well as
estimated.
• Decisions must be made recognizing the
fact that organizations are open systems
interacting with the environment
 General Decision Making
Definition:
A process of judgment making for
implementation after taking into
consideration the facts, feelings, opinions,
and circumstances of an issue related to an
individual/group/organization.
The Best way of Making a Decision
Consultative & Participative way of Making a
Decision

Decision making is a Collective Responsibility

Individual ability with out collective responsibility is
a liability to the organization.
The Risk of Not Making Decision

The fact is that, the risk of not making a

decision is probably greater than the risk of
making a decision.

There is always a choice for making a

decision. Even if there is not a choice for not
making decision.
 3 Abilities for Achievements
• Ability to Make a Decision
• Ability to Implement the Decision
• Ability to follow up till to get the desired
Results.
 How to Make a Decision
1. Get the Facts
– Review the record/history/experience
– Find out what Rules and Customs
Apply
– Get opinions and feelings

Be sure that you have the whole story.

 How to Make a Decision
2.Weigh the Facts
– Fit the facts together
– Consider their bearing on each other
– Check practices and policies
– What possible alternatives are there?
• Consider objective & effect on individual/
• Group / organization.

Do not jump to conclusions.

 How to Get Opinions and
Feelings
1. Don’t Argue
Is anything ever satisfactorily settled by
an argument?

2. Encourage people to talk about

what is important to them.
Opinions and feelings are facts to the
persons who hold them
 How to Get Opinions and
Feelings
3. Don’t Interrupt
If you are telling a story, do you like to be
interrupted?
Without all the facts, is it possible to spell
your action.
4 .Don’t do all the Talking yourself
Be a Good Listener. Your interest must be
real.
 How to Make a Decision
3.Take Action
– Are you going to handle this
yourself?
– Do you need help in handling?
– Should you refer to your Superior?
– Watch the timing of your action

Did your action help organization.

 Best Practices for Effective
Decision Making
• Positive Thinking
• Focusing on Vision, mission, Values
• Goal determination
• Participative & Consultative culture
• Patience Listening & Tactful
• Priorities Selection
• Win-Win Approach
• Empathy Vision
• Application of Creative & Innovation
 Decision Implementation
• Explain the need for implementation of the
decision.
• Involve the people concern
• Share the information before implementation
• Follow up the progress periodically
• Make up the short falls
• Develop the feed back system both formal and
informal
• Review the results
Thank you