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3.2 (Stakeholders-Government Customers Suppliers Employees Owners…
3.2
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decision making
Risk-chance of incurring misfortune or loss.
Uncertainty- situation where there is lack of knowledge,outcomes are unpredictable.
Types of decision making
Scientific-supported by quantifiable evidence. :check: encourages logical thought process :red_cross:time consuming
1:set objectives 2:gather data 3:analyse data 4:make decision 5:implement decision 6:review decision
Intuition-allows for quick decision making. :check:encourages innovation and creativity :red_cross:difficult to justify.
:pencil2:manager relys on instinct :pencil2:data is not readily available :pencil2:appropriate when a personalities plays a key part and when a quick decision is necessary
Decision trees
1. a square is drawn to represent the initial decision 2.the number of potential outcomes need to be identified, a circle is drawn at the outcomes 3. the likelihood of possible outcomes happening to diagram. 4. value of each outcome added to diagram. 5.outcome x probability , outcomes added together to gain the EV of each option. EV is put in each outcome circle 6. initial cost for each outcome is deducted from EMV 7 amount of return for the most viable decision is placed in decision box..
:check:takes risk into account :check:provides a logical approach :red_cross: doesn't consider time periods :red_cross:difficult to get accurate and realistic data
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Influences on decision making :<3:mission-does the decision fit in with the business overall purpose? :<3:objectives-does the decision help them achieve goals within a time period. :<3:ethics- is the decision morally right. :<3: resource constraints- is it achievable with the resources available such as time and finance. :<3: external environment-competition.
Theories
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The Blake mouton grid
based on two behavioural dimensions of concern for people or concern for production which identifies 5 leadership styles
impoverished management,country club management,team management,authority obedience and organisation man management.
leadership & management
Leadership-ability to influence and direct people Management-resources are used and decisions made in order to meet the objectives of the firm
management functions...... :fire:setting objectives :fire:analysing :fire:leading :fire:making decisions :fire:reviewing
leadership styles..... :red_flag:Autocratic-decisions without consultation :black_flag:Democratic-asks team but makes the final decision :star:Laissez faire- team makes decisions :<3:Paternalistic-desicions based on the needs of workforce as well as the business
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Internal influences on leadership style- :explode:expertise,experience and skills of workforce :explode:personal traits of leader :explode: group size :explode:time frame with task to be undertaken external influences leadership style- :explode:political :explode:economic :explode:social environment :explode:technological changes :explode:changing nature of industry
