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April 21, 2013

Different types decision

Modern enterprise operation and management activities of the complexity, diversity, determines the business management decision-making there are a number of different types.

(a) according to the decision's sphere of influence and the important degree is different, divided into strategic decision and tactical decision making

Strategic decision-making is refers to the enterprise development direction and development vision of the decisions that are important to the development of the enterprise overall, long-term, the major decisions of direction. As for the enterprise the management direction, operation policy, such as new product development decisions. Strategic decisions made by enterprise top leadership. It has extent effect time is long, wide range, the characteristics of the deep, is the basis of tactical decisions and central goal. It's correct or not, directly decide the rise and fall success or failure of the enterprise, decided to enterprise development prospects.

Tactical decisions is refers to the enterprise in order to ensure the realization of the strategic decision and management of local business decisions. Such as enterprise procurement of raw materials and machinery and equipment, production and sales plan, the source of the goods such decisions, the deployment of personnel, etc. Tactical decisions usually made by the enterprise middle managers. Tactical decisions to serve the strategic decision-making.

(2) according to the decision main body of the different, divided into personal and collective decisions

Individual decision is by the enterprise leader relies on personal wisdom, experience and knowledge of information for decision making. Decision-making speed, high efficiency are the characteristics of decision for conventional transaction and the urgency of the problem. The biggest drawback of individual decision-making is a subjective and one-sided, therefore, to overall situation major issue should not be used.

Collective decision-making is refers to the combination of up and down by the conference organization and decision making. Meeting organization decision-making by the board of directors, manager enlargement and workers congress authority members of the collective decisions together. And combining related decision-making is leading institutions and affiliated institutions formed by the combination of decision-making, leadership and the masses. Collective decision-making has the advantage that can give full play to the group of wisdom, put our heads together and decision carefully, so as to ensure the correctness and effectiveness of decision-making; Drawback is the decision making process is complicated, time consuming more. It is suitable for long-term planning, global decisions.

(3) according to the decision whether always repeat, divided into programmed and non programmed decisions

Programmed decisions, it is to point to the problem of making a decision is often appear problem, there has been a processing experience, procedures, rules, can according to the conventional way to solve. Programmed decisions is known as the "routine decisions". Enterprise production of the product quality is not qualified, for example, if the handle? Shops selling expired food how to solve? Belongs to the programmed decisions.

Non programmed decisions is to point to the problem of making a decision is not often appear, has no fixed pattern, the experience to deal with, want to rely on decision makers to make a new judgment to solve. Also called unconventional decision non programmed decisions. Such as enterprises to open up new sales market, commodity circulation channel adjustment, select new promotions and other unconventional decision.

(4) according to the decision problem is different, divided into under the condition of fully know the decision, risk type decision and decision under the condition of not completely known

1. Under the condition of fully know the decision

It refers to the decision making process, put forward the alternative in the know objective conditions, there is only one result for each, and compare the results and make the optimal choice decisions. Determine the type of decision is the decision of a certain condition. Decision makers on the conditions, the nature of the decision problem, has fully understand the consequences, only one result for each alternative. This kind of decision making is the key to select must state the best solutions.

2. Risk type decision

It refers to such kind of decision. Put forward various alternatives in the decision-making process, each solution has several different results, can know it happen probability can also measure, under the condition of such decisions, is risk type decision. For example, some enterprise in order to increase profits, and put forward two options: one solution is to increase the old product sales; Another solution is to develop new products. No matter which kind of solution will meet the market demand is high, the market demand and market demand generally low several different possibilities, they happen probability can be measured, if meet the market demand is low, enterprises will be losses. Thus under the condition of the decision, with a certain risk, so it is called the risk type decision. Risk type decision, because various market factors affecting prediction target is complex and changeable, the execution results of each scheme therefore have great randomness. Decisions, no matter choose what kind of solution, there is a certain risk.

3. Under the condition of not completely know the decision

It refers to such kind of decision making, puts forward various alternatives in the decision-making process, and each scheme has different result can know, but the probability of each outcome cannot know. In such conditions, the decision is not to determine the type of decision making. The difference between it and risk type decision: risk type decision, each package of several possible outcomes and their probabilities knows, undetermined type decision only know that every solution of several possible results, but the probability is not know. This type of decision is due to several possible objective state of the market demand of random rule understanding insufficiency, it increases the degree of uncertainty decision-making

Decision analysis techniques

Different types of information needed for different decision and way of analyse it. On the basis of perceptions of the problem and the options available, the decision maker asseses the expected outcomes and the choice of actions is dependent on evaluations in terms of personal objectives. The decision making process is an amalgam of both rational and sociopsychological factors. It is an approach that allows a decision maker to carry out a through and logical evaluation of alternative strategies in order to determine systematically the "best" available strategy in terms of an objective criterion. Accrording to the author this approach is sometimes called prescriptive analysis, whereas the analysis of the socio-psychological factors is called descriptive or behavioural analysis.

Simon's (1959) concept of bounded rationality is a useful meand to think about decision making ans to an extension to bounded rationality. This framework view rarionality as unbounded and bounded. Unbounded rationality involves models that optimize based on Bayesian approaches, while bounded rationality involves models that relect real life decisionss. Recent studies on human judgement and choices have shown that the prescriptive models are unable to acount for how prople actually make decisions. As most people violate the prescriptive principles because decision making is behavioural in nature.

April 18, 2013


I think Decision making happen every second in our life, things like when I go to bed, what I want to eat. These happen automatically without going through the decision process, when it became a common course it become part of our life. But this does not mean it is the right decision, as decision makers always trying to find the easiest way to solve the problems, it might be we just don't have time and the energy to find better alternatives. Decision-making should aim to solve a particular problem, or to achieve certain goals. Determine the target is the first step in the decision making process.

There are many definitions about "decision making", to sum up, there are three basic understanding:

  • Set a decision making as question, a process of selecting the scheme, design and to set goals.
  • Consider decisions from several alternative plans to make a final decision.
  • To assume that a decision is uncertain conditions in the event of contingencies, unprecedented event, not rule to follow, make a choice with some risks.

February 26, 2013

Decision making

  • Decision making process Define and clarify the issue - does it warrant action? If so, now? Is the matter urgent, important or both. See the Pareto Principle.
  • Gather all the facts and understand their causes.
  • Think about or brainstorm possible options and solutions. (See brainstorming process)
  • Consider and compare the pros and cons of each option - consult if necessary - it probably will be.
  • Select the best option - avoid vagueness or 'foot in both camps' compromise.
  • Explain your decision to those involved and affected, and follow up to ensure proper and effective implementation.

Problem solving and decision-making are important skills for business and life. Problem-solving often involves decision-making, and decision-making is especially important for management and leadership. There are processes and techniques to improve decision-making and the quality of decisions. Decision-making is more natural to certain personalities, so these people should focus more on improving the quality of their decisions. People that are less natural decision-makers are often able to make quality assessments, but then need to be more decisive in acting upon the assessments made. Problem-solving and decision-making are closely linked, and each requires creativity in identifying and developing options, for which the brainstorming technique is particularly useful. See also the free SWOT analysis template and examples, and PEST analysis template, which help decision-making and problem-solving. SWOT analysis helps assess the strength of a company, a business proposition or idea; PEST analysis helps to assess the potential and suitability of a market. Good decision-making requires a mixture of skills: creative development and identification of options, clarity of judgement, firmness of decision, and effective implementation. For group problem-solving and decision-making, or when a consensus is required, workshops help, within which you can incorporate these tools and process as appropriate. Here are some useful methods for effective decision-making and problem-solving: First a simple step-by-step process for effective decision-making and problem-solving. See also the decision-making facilitative questions template. And definitely see the ethical decision-making quick guide.

February 25, 2013


Today we started the first lecture of Robust Decision Making. It is very interesting course, and we have looked at a number of images about different brain activities leads to different decisions. I think it is a common logic, because everyone is different. Although we think differently, the most important is which way of thinking would lead to the right decision. In real life situation we make decisions trying to achieve particular aim, it would be useless to make decision without a point. Additionally, I think robust decision making support risk management and tackle with unknown or uncertainty problems. But in order to make the right decisions we also need to be based on our knowledge and experience.

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