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Management
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1
Managerial Decision Making
The process by which managers identify problems and try to
resolve them
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Characteristics of managerial decisions
Risk
Uncertainty
Conflict
Lack of structure
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Lack Of Structure
Programmed decisions Non Programmed decisions
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Programmed Decisions
Keputusan yang telah pernah diambil sebelumnya dan telah terbukti benar, dapat diselesaikan dengan menggunakan aturan-aturan yang sederhana, policy perusahaan dan perhitungan yang simple
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Non Programmed decisions Keputusan-keputusan yang tidak/
belum tahu bagaimana cara untuk menyelesaikannya. Keputusan yang tidak berdasarkan perhitungan baku yang ada, standard perusahaan atau belum pernah teruji.
Pengambil keputusan harus membuat metode baru untuk mengambil keputusan (memakaipendekatan yang kreatif)
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Types of decisions
Programmed decisions NonProgrammed decisions Type of problem
Frequent, repetitive, routine, much certainty regarding cause and effect relation ships
Novel, unstructured, much uncertainty regarding cause and effect relationship
Procedure Dependence on policies, rules and definite procedures
Necessity for creativity,intuition, tolerance for ambiguity, creative problem solving
Examples Business firm: Periodic reorders of inventory
Business firm: diversification into new products and markets.
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Uncertainty
Situasi dimana pengambil keputusan berada dalam ketidak pastian atau tidak mampu memastikan kemungkinan yag akan terjadi
The leaders has insufficient information to make decisions, they may have strong opinions but they are still operating under pressure
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Risk
Probability of success is less than 100 %
When we can estimate the likelihood of various consequences and we still do know the certainty
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Conflict
Is opposing pressure from different sources occurs at two levels
psychological conflict - individual decision makers: perceive several attractive options perceive no attractive options
conflict between individuals or groups
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Identifying anddiagnosingthe problem
Generatingalternativesolutions
Evaluatingalternatives
Evaluatingthe decision
Implementingthe decision
Making thechoice
The Stages Of Decision Making
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5
4
3
1 2
6
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Identifying and diagnosing the problems (first stage)
Recognize the problem exists (the current state and desire state)
Comparing past performance Current performance Future expected (plan and forecasts)
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Generating alternative solution (second stages)
Manager generate some alternative solution
Ready-made solutions (idea they have tried before or follow the advice of others who have faced similar problems)
Custom-made solutions (combining ideas into new and creative solutions)
Based on past experience ???
2
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Evaluating alternatives (third stages)
The fundamental is to predict the several types consequence that will occur
Key questions Is the information complete and current ? Does the alternative meet our primary objective ? What problems will happen ?
Result cannot be forecast in the perfect accuracy Decision makers can build in safeguard against an
uncertainty future by considering the potential consequence of several scenario.
3
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Evaluating alternatives (third stages)-continue
Contingency plans The alternative of action that can be
implemented based on how the future unfolds
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Making the choice (fourth stages)
The concepts are : Maximizing Satisficing Optimizing
4.
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Maximize
Realizes the greatest positive consequences and the fewest negative consequences
Or Maximizing results in greatest benefit
at the lowest cost
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Satisfice To choose an option that is acceptableacceptable,
although not necessarily the best or perfect
Barriers: People do not spend time to gather complete
information Compare with the choice against the goal not
against other option Time limited Information not available Other constrains make it impossible
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Optimizing
Achieving the best positive balance among several goals
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Implementing the decision (fifth stages)
those who implement the decision must: understand the choice and why it was made be committed to its successful implementation
can’t assume that things will go smoothly during implementation identify potential problems identify potential opportunities
5.
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Implementing the decision (fifth stages)-cont
If not go smooth identify potential problem What problems could this action cause ? What can we do to prevent the problems ? What unintended benefits or opportunities could
arise ? How can we make sure they happen ? How can we be ready to act when the
opportunities come ?
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ImplementationPlan
Steps In The Implementation Plan
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Decision evaluation is useful whether the feedback is positive or negative
Positive will applied Negative feed back
Implementation will require more time, resources, effort or thought
Decision was bad one decision appears inappropriate, back to
first stage
Evaluating the decision (sixth step)6.
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The best decision
The decision maker were appropriately vigilant (waspada) in making the decision. Kewaspadaan (Vigilance) akan terjadi
apabila para pengambil keputusan secara hati-hati dan sadar menerapkan ke 6 langkah pegambilan keputusan, termasuk membuat rencana implementasi dan evaluasi.
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The decision are influenced by subjective Psychological biases, time pressure, and social realities.
Barriers to Barriers to effective decision makingeffective decision making
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Halangan Dalam Membuat Keputusan Yg Efektif
Psikologis
Illusion of control (rasa percaya yang berlebihan bahwa orang itu dapat
mempengaruhi hasil akhir, padahal ia tidak mempunyai kontrol atas kejadian itu)
Framing effects (bagaimana problem atau pilihan keputusan itu di
presentasikan atau di persepsikan)Discount the future (bagaimana seseorang memilih biaya dan keuntungan
jangka pendek daripada biaya dan keuntungan jangka panjang)
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Manager must understanding how groups and teams operate and how to use them to improve decision making.
“ two heads are better than one”
Decision making on groups
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Decision making on groups (cont)
Potential advantages Larger pool of
information More prospective and
approach Intellectual simulation People understand the
decision People are committed
to the decision
Potential disadvantages One person
dominates Groupthink Goal displacement
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Managing group decision maker
Effective group decision maker
Leadership1.Avoid domination2.Encourage input3.Avoid groupthink and satisficing4.Remember goals
Constructive conflict1.Air legitimate differences2.Stay task-related3.Be impersonal4.Play devil’s advocate
Creativity1.Brainstorm2.Avoid criticizing3.Exhaust ideas4.Combine ideas
3-29
Managing Group Decision Making
Leadership style leader should attempt to minimize process-
related problems leader should:
avoid dominating the discussion encourage less vocal members to express
themselves stay alert to groupthink and psychological bias prevent group from losing sight of the primary
objective
3-30
Managing Group Decision Making (cont.) Constructive conflict
a certain amount of constructive conflict should exist cognitive conflict - issue-based differences in
perspectives or judgments (perspektif dan praduga) most constructive type of conflict can air legitimate differences of opinion and develop
better ideas affective conflict - emotional disagreement
directed toward other people that is likely to be destructive
devil’s advocate - has the job of criticizing others
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Decision making in crisis Manager must make decision under a great
deal of pressure Commonly a crisis makes effective decision
making less likely Psychological stress and lack time cause
decision makers to think simplistic terms, to fail to consider an adequate number of alternatives and to ignore the long term implications of their actions.
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Decision making in crisis (cont)
Some crisis can prevent by Clarifying the corporation values and
social responsibilities Monitoring of people’s behavior and
ethical
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Decision making in crisis (cont)
An effective plan for crisis management should include the following elements
Strategic action such as integrating CM into strategic planning and officials policies
Technical and structural actions such as creating a CM team and dedicating budget to CM