A solution has to be evaluated in terms of the anticipated responses to it. Programmed and Non-Programmed Decisions 9. When making a decision managers are faced with alternatives. This provided a better and more complete management structure since decision making was . In some situations, implementation may be fairly easy; in other situations it may be quite difficult. . It may be stressed at this stage that the differences among those who make decision, those who implement them and those who must live on them should not be minimised. A management information system (MIS) provides information that organizations require to manage themselves efficiently and effectively. In a like manner the listing of constraints alerts the decision maker to the important stumbling blocks affecting a solution so that they can be avoided. Furthermore, organisations sometimes confront situations in which the absence of a specific resource or the existence of a particular constraint is a significant problem itself.. In decision-making, MIS cannot take the place of managerial decisions. In fact many of the operations research techniques developed during the last few decades are methods of determining the relative efficiency of various alternatives. Goal oriented process: Decision-making aims at providing a solution to a given problem/ difficulty before a business enterprise. Designing jobs and work processes, including the automation of tasks. Managers in the not-for-profit and public enterprises are faced with a similarly wide range of decisions. However, there are certain weaknesses of the group decision-making process. 4. Two or three of the most likely alternatives are then presented to top management which makes the final decision. Be it strategic, business activities or HR matters . Most often than not decision makers filter the information they receive, i.e., they pay more attention to some information than to other information. Introduction to Decision Making in Management: In todays dynamic world business firms have to take a number of decisions every now and then. Finally, in personnel decisions have to be made about new and different pay scales and the likely impact on current wage rates. The manager, in fact, examines four to five alternative possibilities and chooses the best possible option from among them, rather than investing the time necessary to examine thoroughly all possible alternatives. However, with an objective stated as in B, there would be less room for debate about success or failure. This is, of course, a realistic assumption provided the decision maker is able to obtain complete information concerning all possible alternatives and thus choose the best solution designed to achieve a particular goal. This phenomenon can, of course, be prevented if the leader accepts ultimate responsibility for decision-making. There are various reasons for such resistance such as insecurity, inconvenience and fear of the unknown. Decisions are made at every level of management to ensure organizational or business goals are achieved. This explains why most management training programmes are directed towards improving a managers ability to make non-programmed decisions by teaching them how to take such decisions. Level 1 decision making should be used sparingly if you want to create an empowered culture where everyone is contributing at their highest level. Strategic decision-making determines the objectives, resources, and policies of the organization. Writers on organisations have suggested that creativity is needed at this stage in developing various possible alternatives for consideration. ii. and Other Details. Institutional decisions concern such diverse issues as diversification of activities, large-scale capital expansion, acquisition and mergers, shifts in R & D activities and various other organisational choices. Gather information Next, it's time to gather information so that you can make a decision based on facts and data. The MIS is defined as an integrated system of man and machine for providing the information to support the operations, the management and the decision-making function in the organization. A solution should have substantial quality so that it can meet organisational goals. . fMIS IS AN EFFECTIVE TOOL IN DECISION MAKING The Indian business scenario is also changing at a very fast rate in all the aspects and in all the areas, using advanced software tools like MIS, DSS and Expert System. However, 1978 Nobel Laureate H. A. Simon has made extensive study of managerial behaviour and on the basis of his investigation arrived at the conclusion that modern managers do not always attempt to maximize profits. It is perhaps easiest for managers to refer to a policy rather than think of some problem and suggest solution. He has made the point that decisions differ not only in their content but also in terms of their relative uniqueness. By the term relative uniqueness he means the degree to which a problem or decision (1) has been seen before; (2) occurs frequently and at regular intervals; and (3) has been solved or resolved in a satisfactory manner. Finally, a post decision observation should be made to determine how successful the decision was in solving the original problem. Types of Decisions 7. Decision makers are unable or unwilling, or both, to fully anticipate the consequences of each available alternative. Thus when a situation calls for a programmed decision managers must ultimately make use of their own judgement. When managers make decisions they exercise choice they decide what to do on the basis of some conscious and deliberate logic or judgement they have made in the past. One of the alternatives that was identified previously (the second or third choice) could be adopted. Management Information Systems (MIS) is the key factor to facilitate and attain efficient decision making in an organization. See Fig.8.7. Managerial decision-making is also concerned with regulating and altering the relationship between the organisation and its external (immediate) environment. The implication of this statement in the present context is clear: more information can be processed by the various group members. Determine why this decision will benefit your customers or fellow employees. Disclaimer 8. He only recognizes the very important fact that more often than not, decisions are balanced with the cost (measured in terms of time and money) of making it. Level One: The Leader Alone Decides. However, most important and strategic decisions in modern organisations are taken under conditions of uncertainty. Decision making is an integral part of all marginal activities including organising, leading and controlling. Decision making can be defined as making a choice among alternative courses of action or as the process of choosing one alternative from among a set of rational alternatives. Prior to the actual decision, existing conditions relevant to the decision itself are observed, assessed and measured. When choosing a supplier, we will usually dose on the basis of price and past performance. vii) Management information system helps an organization to achieve a competitive advantage. It is perhaps easiest for managers to make programmed decisions.. There are several ways of doing it. (iii) Choosing the Most Appropriate Alternative: After evaluating the alternatives properly it is necessary to choose the alternative which is acceptable to those who must implement it and those who have to bear the consequences of the decision. Managers know how important decision-making is from the organisational point of view. It is a goal-oriented process and provides solutions . MIS can be considered mainly for quantitative factors. As R. W. Morell has put it, there is hardly any reason for carefully making a choice among alternatives unless the decision has to bring them closer to same goal. Fig. Decision Support System (DSS) 3. Assessing the effect of possible future changes in the environment is an essential step in decision-making. Report a Violation 11. Identification of Resources and Constraints: Just as a business manager does not operate in isolation, problem solving does not occur in vacuum. This explains why the decision maker must become aware of and be sensitive to the decision environment before any decision is possible. the "gate-keeping" role of MIS in decision making and overall well-being of the organization. Fig. As the final step in the decision-making process, managers should be very sure to evaluate the effectiveness of their decision. Content Filtration 6. If the firm consistently achieves a given objective, then the objective might be reviewed or changed to prevent under-achievement. Moreover, the manager must also be able to define the situation. The choice of solution should focus on present alternatives, not past possibilities. More often than not it is simply assessed that the nature of a managerial problem is obvious to all concerned. In other words, managers hardly enjoy any discretion in matters involving programmed decisions set managers, decide what to do. Managers of most profit-seeking firms are always faced with a wide range of important decisions in the areas of pricing, product choice, cost control, advertising, capital investments, dividend policy and so on. Since it is a computer system, it includes elements of the computer system as well. Every organization needs to make decisions at one point or other as part of managerial process. Secondly, performance data must be readily available so that the comparison to standards may be made. 8.8 shows an effective process for evaluating alternatives. Use of computer: Complex process: Economical: Variety: Future-oriented: Flexible: What are the basic functions of MIS? You'll learn how these systems work, how they provide value for the business, and the challenges of . Management information system is a system, which is designed to provide information to various organizational levels, to assist them in decision-making. Introduction. Evaluation of Alternatives and Selection of a Course of Action. Once decision is taken, it implies commitment of resources. Strategic Production Planning: Strategic planning involves deciding and developing strategic plans to achieve strategic objectives (or goals). The purpose of MIS is reporting and is to provide the necessary information to managers and supervisors at various levels to help them to discharge their functions of organising, planning, control and decision making. Managers should also recognise that even when all alternatives have been evaluated as precisely as possible and consequences of each alternative weighed, it is likely that unanticipated consequences will also arise. The saying two brains are better than one, like many others, contains an elephant of truth. 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