Topics: Risk, Decision making, Decision theory Pages: 19 (6007 words) Published: December 11, 2012
Much of what managers and supervisors do is solve problems and make decisions. New managers and supervisors, in particular, often make solve problems and decisions by reacting to them. They are "under the gun", stressed and very short for time. Consequently, when they encounter a new problem or decision they must make, they react with a decision that seemed to work before. It's easy with this approach to get stuck in a circle of solving the same problem over and over again. Therefore, as a new manager or supervisor, get used to an organized approach to problem solving and decision making. Not all problems can be solved and decisions made by the following, rather rational approach. However, the following basic guidelines will get you started.


What is decision making?
1) 2) Some Definitions Kinds of Decisions a- Decisions whether b- Decisions which c- Contingent decisions


The Decision Environment
Approaches to Decision Making a- Authoritarian b- Group



Some Decision Making Strategies a- Optimizing b- Satisficing c- Maximax d- Maximin


Decision Making Procedure and techniques

1) Basic







solving 2) Decision making techniques
a- Pareto Analysis b- Paired Comparison Analysis c- Grid Analysis d- PMI e- Force Field Analysis f- Six Thinking Hats g- Starbursting h- Stepladder Technique i- Cost/Benefit Analysis j- Decision Trees


1) 2) 3) 4) General Comments on Risk Taking The Orthodox Theory of Risk Evaluation Advice on Risking Risk Management Strategies


What is decision making?
1)Some Definitions

A good place to start is with some standard definitions of decision making. Decision making is the study of identifying and choosing alternatives based on the values and preferences of the decision maker. Making a decision implies that there are alternative choices to be considered, and in such a case we want not only to identify as many of these alternatives as possible but to choose the one that (1) has the highest probability of success or effectiveness and (2) best fits with our goals, desires, lifestyle, values, and so on. Decision making is the process of sufficiently reducing uncertainty and doubt about alternatives to allow a reasonable choice to be made from among them. This definition stresses the information-gathering function of decision making. It should be noted here that uncertainty is reduced rather than eliminated. Very few decisions are made with absolute certainty because complete knowledge about all the alternatives is seldom possible. Thus, every decision involves a certain amount of risk.

2)Kinds of Decisions
There are several basic kinds of decisions.

Decisions whether

This is the yes/no, either/or decision that must be made before we proceed with the selection of an alternative. Should I buy a new TV? Should I travel this summer?

b- Decisions which
These decisions involve a choice of one or more alternatives from among a set of possibilities, the choice being based on how well each alternative measures up to a set of predefined criteria.

c- Contingent decisions

These are decisions that have been made but put on hold until some condition is met. For example, I have decided to buy that car if I can get it for the right price; I have decided to write that article if I can work the necessary time for it into my schedule. OR even, We'll take the route through the valley if we can control the ridge and if we detect no enemy activity to the north. Most people carry around a set of already made, contingent decisions, just waiting for the right conditions or opportunity to arise. Time, energy, price, availability, opportunity, encouragement--all these factors can figure into the necessary conditions that need to be met before we can act on our decision.

3)The Decision Environment
Every decision is made within a decision environment, which is...
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