Shruti Speak's

The decision making systems can be classified in a number of ways. There are two types of systems based on the manager’s knowledge about the environment. A . Closed decision making system : If the manager operates in a known environment then it is a closed decision making system. The conditions of the closed decision making system are: (a) The manager has a known set of decision alternatives and knows their outcomes fully in terms of value, if implemented. (b) The manager has a model, a method or a rule whereby the decision alternatives can be generated, tested, and ranked. (c) The manager can choose one of them, based on some goal or objective. A few examples are: a product mix problem, an examination system to declare pass or fail, or an acceptance of the fixed deposits. B. Open decision making system: If the manager operates in an environment not known to him, then the decision making system is termed as an open decision making system. The conditions of this system are:...

How do we ensure rationality ? It is ensured, if the process of decision making is carried out systematically, whereby all the aspects of the decision making discussed above are taken care of. Herbert Simon said that a decision maker follows the process of decision making disregarding the decision or the type of decision and the motive behind the decision. This process is followed consciously or without knowing it. We can put this process in the Decision Making Mode. Simon (1977) describes the process of decision making as comprising four steps: 1.Intelligence 2.Design 3.Choice 4.Later stage has been added with a view of improving the decision i.e. Review . The intelligence stage: encompasses collection, classification, processing, and presentation of data relating to the organization and its environment. This is necessary to identify situations calling for decision. During the design stage: , the decision maker outlines alternative solutions, each of which involves a set ...

Decision making is a complex situation. To resolve the complexity, the decisions are classified as programmed non-programmed decisions. If a decision can be based on a rule, method or even guidelines, it is called the programmed decision . If the stock level of an item is 200 numbers, then the decision to raise a purchase requisition for 400 numbers is a programmed-decision-making situation. The decision maker here is told to make a decision based on the instructions or on the rule of ordering a quantity of 400 items when its stock level reaches 200.If such rules can be developed wherever possible, then the MIS itself can be designed to make a decision and even execute. The system in such cases plays the role of a decision maker based on a given rule or a method. Since the programmed decision is made through MIS, the effectiveness of the rule can be analyzed and the rule can be revived and modified from time to time for an improvement. The programmed decision making can be delegate...

We use our decision making skills to solve problems by selecting one course of action from several possible alternatives. Decision making skills are also a key component of time management skills. Decision making can be hard. Almost any decision involves some conflicts or dissatisfaction. The difficult part is to pick one solution where the positive outcome can outweigh possible losses. Avoiding decisions often seems easier. Yet, making your own decisions and accepting the consequence is the only way to stay in control of your time, your success, and your life. http://www.scribd.com/doc/18046759/Chapter-2-various-concepts-of-MIS TYPES OF DECISIONS The types of decisions are based on the degree of knowledge about the outcomes or the events yet to take place. If the manager has full and precise knowledge of the event or outcome which is to occur, then his problem of the decision making is not a problem. If the manager has full knowledge, then it is a situation of certainty. If he...

Risks Associated With MIS Risk reflects the potential, the likelihood, or the expectation of events that could adversely affect earnings or capital. Management uses MIS to help in the assessment of risk within an institution. Management decisions based upon ineffective, inaccurate, or incomplete MIS may increase risk in a number of areas such as credit quality, liquidity, market/pricing, interest rate, or foreign currency. A flawed MIS causes operational risks and can adversely affect an organization's monitoring of its fiduciary, consumer, fair lending, Bank Secrecy Act, or other compliance-related activities. Since management requires information to assess and monitor performance at all levels of the organization, MIS risk can extend to all levels of the operations. Additionally, poorly programmed or non-secure systems in which data can be manipulated and/or systems requiring ongoing repairs can easily disrupt routine work flow and can lead to incorrect decisions or impaired pla...

Achieving Sound MIS The development of sound MIS is the result of the development and enforcement of a culture of system ownership. An "owner" is a system user who knows current customer and constituent needs and also has budget authority to fund new projects. Building "ownership" promotes pride in institution processes and helps ensure accountability. Although MIS does not necessarily reduce expenses, the development of meaningful systems, and their proper use, will lessen the probability that erroneous decisions will be made because of inaccurate or untimely information. Erroneous decisions invariably misallocate and/or waste resources. This may result in an adverse impact on earnings and/or capital. MIS which meets the five elements of useability is a critical ingredient to an institution's short- and long-range planning efforts. To achieve sound MIS, the organization's planning process should include consideration of MIS needs at both the tactical and s...

(a) Ascertaining the problem: As Peter Drucker points out, .the most common source of mistakes in the management decisions is the emphasis on finding the right answers rather than the right questions.. The main task is to define the right problem in clear terms. The management may define the problem as the .Sales are declining. Actually, the decline of sales is symptomatic; the real problem may be somewhere else. For example the problem may be the poor quality of the product and you may be thanking of improving the quality of advertising. (b) Insufficient knowledge: For perfect rationality, total information leading to complete knowledge is necessary. An important function of a manager is to determine whether the dividing line is reached between insufficient knowledge and the enough information to make a decision. (c) Not enough time to be rational: The decision maker is under pressure to make decisions. If time is limited, he may make a hasty decision which may not satisfy the te...