For this post I want to share about decision making in an organization.
MAKING BUSINESS DECISIONS
*Decision making is one of the most important and challenging aspect of management.
*Today with massive volumes of information available managers are challenged to make highly complex decision.
*Figure below displays the three primary challenges managers face when making decision.
THE DECISION-MAKING PROCESS
They are plays crucial role in communication and leadership.There are numerous academic decision making models.
DECISION-MAKING ESSENTIAL
*Few key concepts about organizational structure will help our discussion of making decision-making tools. Structure similar to a pyramid.
*Different level require different types of information to assist in decision making, problemsolving and opportunity capturing.
OPERATIONAL
*Employees develop, control and maintain core business activities required.
*Also considered structured decision ,arise in situations where established process offer potential solutions.
*Made frequently and are almost repetitive in nature.
MANAGERIAL
*Employees are continuously evaluating company operations to hone the firm's abilities to identify, adapt, to and leverage change.
*Cover short and medium range plans, schedules and budget along with policies, procedure and business objectives for the firm.
*Semistructured decision occur in situation few established process help to evaluate potential solutions.
EXAMPLE:decision about producing new product
changing employee benefits range from unstructured to
semistuctured
STRATEGIC
*Managers develop overall business strategies, goals, and objectives.
*Monitor strategic performance and its overall direction in political,economic and competitive business environment.
*Unstructured decisions,in situation in which procedures or rules exists to guide decision makers.
SUPPORT: ENHANCING DECISION MAKING WITH MIS
TRANSACTION
PROCESSING SYSTEMS
Moving up through the organizational pyramid
users move from requiring transactional information to analytical information
- Transaction processing system - the basic business system that serves the operational level (analysts) in an organization
- Online transaction processing (OLTP) – the capturing of transaction and event information using technology to (1) process the information according to defined business rules, (2) store the information, (3) update existing information to reflect the new information
- Online analytical processing (OLAP) – the manipulation of information to create business intelligence in support of strategic decision making
DECISION
SUPPORT SYSTEMS
Decision
support system (DSS) – models information to support managers and business professionals
during the decision-making process
Three
quantitative models used by DSSs include:
- Sensitivity analysis – the study of the impact that changes in one (or more) parts of the model have on other parts of the model
- What-if analysis – checks the impact of a change in an assumption on the proposed solution
- Goal-seeking analysis – finds the inputs necessary to achieve a goal such as a desired level of output
What-if
analysis
Goal-seeking
analysis
EXECUTIVE
INFORMATION SYSTEMS
Digital
dashboard – integrates
information from multiple components and presents it in a unified display
ARTIFICIAL INTELLIGENCE (AI)
Four most
common categories of AI include:
- Expert system – computerized advisory programs that imitate the reasoning processes of experts in solving difficult problems
- Neural Network – attempts to emulate the way the human brain works
- Fuzzy logic – a mathematical method of handling imprecise or subjective information
- Genetic algorithm – an artificial intelligent system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem
- Intelligent agent – special-purposed knowledge-based information system that accomplishes specific tasks on behalf of its users
DATA
MINING
Data-mining
software includes many forms of AI such as neural networks and expert systems
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