One is to regard decision-making as a process including asking questions, setting goals, designing and selecting schemes. This is a broad understanding.
Second, decision-making is the final choice from several alternative action plans, and it is the final decision of decision makers. This is a narrow understanding.
Thirdly, it is considered that decision-making is a decision to deal with accidental events under uncertain conditions. There is no precedent for this kind of incident, and there is no law to follow. Making a choice is risky. In other words, only the choice of taking certain risks is a decision. This is the narrowest understanding of the concept of decision. The above explanation of the concept of decision-making is carried out from different angles. In order to scientifically understand the concept of decision-making, it is necessary to examine herbert simon's views on the connotation of decision-making in decision-making theory.
Generally speaking, decision-making means making a decision, that is, making a decision on the problem that needs to be solved. According to the custom of China people, the word "decision-making" is understood as "decision-making policy", which is mainly to make decisions on the major policies of the country. But in fact, decision-making not only refers to decisions made by senior leaders, but also includes decisions made by people on daily problems. If an enterprise wants to develop a new product, introduce a production line, and someone chooses a commodity or a career, it is a decision. It can be seen that decision-making activities are closely related to human activities.
To correctly understand the concept of decision-making, we should grasp the following meanings:
(1) Make clear goals and make decisions.
Decision-making is to solve a problem or achieve a goal. Determine goals is that first step in the decision-making proces. The problem to be solved in decision-making must be very clear, and the goal to be achieved must be very specific. Without a clear goal, decision-making will be blind.
(2) There should be more than two alternatives for decision-making.
Decision-making is essentially a process of choosing a course of action. If there is only one choice, there is no decision-making problem. Therefore, there must be at least two or more schemes from which people can compare and choose, and finally choose a satisfactory scheme as the action scheme.
(3) The selected action plan must be put into practice.
If the selected scheme is shelved and not put into practice, making a decision is equal to not making a decision. Decision-making is not only a cognitive process, but also a process of action.
Decision-making is an activity of human society since ancient times, and scientific decision-making began to take shape in the early 20th century. After World War II, decision-making research attracted many scientific achievements, such as behavioral science, system theory, operational research, computer science and so on. , and combined with decision-making practice, by the 1960s, a science-decision-making was formed to study and explore the law of people making correct decisions. Decision-making studies the categories, concepts, structures, principles, procedures, methods and organizations of decision-making, and explores the application laws of these theories and methods. With the deepening and development of the research on decision-making theory and method, decision-making has penetrated into all fields of social economy and life, especially in the business activities of enterprises, resulting in management decision-making.
[Editor] The types of decision-making The complexity and diversity of modern enterprise management activities determine that there are many different types of management decisions.
(a) according to the scope and importance of decision-making, it is divided into strategic decision-making and tactical decision-making.
Strategic decision refers to the decision on the development direction and prospect of an enterprise, and it is an important decision related to the overall, long-term and directional development of an enterprise. Such as making decisions on the business direction, business policy and new product development of the enterprise. Strategic decisions are made by senior leaders of enterprises. It has the characteristics of long time, wide range and far-reaching influence, and is the basis and central goal of tactical decision-making Whether it is correct or not directly determines the success or failure of an enterprise and its development prospects.
Tactical decision-making refers to the decision-making made by enterprises on local management to ensure the realization of strategic decision-making. Such as the procurement of raw materials and machinery and equipment, production and marketing plans, sources of goods, personnel deployment, etc. This is the decision. Tactical decisions are generally made by middle managers in enterprises. Tactical decision should serve strategic decision.
(two) according to the different decision-making subjects, it is divided into individual decision-making and collective decision-making.
Personal decision-making is a decision made by enterprise leaders with personal wisdom, experience and information. Quick decision-making and high efficiency are its characteristics, which are suitable for decision-making of daily affairs and emergency issues. The biggest disadvantage of personal decision-making is that it is subjective and one-sided and not suitable for major global issues.
Collective decision-making refers to the decision made by meeting organization and the combination of higher and lower levels. The decision-making of the conference organization is made by the collective members of the board of directors, the manager's enlarged meeting, the workers' congress and other power institutions. The decision of combining up and down is a decision formed by the combination of leading institutions and subordinate related institutions and the combination of leaders and the masses. The advantage of collective decision-making is that it can give full play to the wisdom of the group, brainstorm and make careful decisions, thus ensuring the correctness and effectiveness of decision-making; The disadvantage is that the decision-making process is more complicated and time-consuming. Suitable for long-term planning and overall decision-making.
(3) According to whether the decision is always repeated, it can be divided into programmed decision-making and non-programmed decision-making.
Procedural decision-making means that decision-making problems are frequent problems, and there are already experience, procedures and rules to deal with them, which can be solved by conventional methods. Therefore, programmed decision-making is also called "conventional decision-making". For example, what if the quality of the products produced by the enterprise is unqualified? How to solve the problem of selling expired food in stores? This is a procedural decision.
Non-programmed decision-making means that decision-making problems do not occur frequently, there is no fixed model and experience to solve them, and it is up to decision-makers to make new judgments to solve them. Non-programmed decision-making is also called unconventional decision-making. For example, enterprises explore new sales markets, adjust commodity circulation channels, and choose new promotion methods.
(4) According to the different conditions of decision-making, it can be divided into decision-making under complete certainty, decision-making based on risk and decision-making under incomplete uncertainty.
1. Decision under the condition of complete certainty
It refers to the decision-making process of comparing the advantages and disadvantages of each alternative and making the best choice under the known objective conditions. Deterministic decision-making is a decision-making in a positive state. Decision makers have a full understanding of the conditions, nature and consequences of decision-making problems, and each alternative can only have one result. The key to this decision is to choose the best scheme in a positive state.
2. Risk-based decision-making
It is this kind of decision. In the decision-making process, various alternatives are put forward, and each alternative has several different results to know, and the probability of its occurrence can also be calculated. In this case, this decision is a risky one. For example, in order to increase profits, an enterprise put forward two alternatives: one is to expand the sales of old products; Another solution is to develop new products. No matter which scheme, there will be several different possibilities, such as high market demand, average market demand and low market demand, and their probabilities can be calculated. If the market demand is low, enterprises will lose money. Therefore, the decision under the above conditions is risky, so it is called risk decision. Risk-based decision-making exists because various market factors that affect the forecast target are complex and changeable, so the implementation results of each scheme are very random. In decision-making, no matter which scheme you choose, there are certain risks.
3. Decision-making under the condition of incomplete certainty
Refers to such a decision, in the process of decision-making, various alternatives are put forward, and each scheme has several different results to know, but the probability of each result cannot be known. Under such conditions, the decision is uncertain. The difference between it and risk decision-making is that in risk decision-making, several possible outcomes produced by each scheme and their occurrence probability are known, while uncertain decision-making only knows several possible outcomes produced by each scheme, but the occurrence probability is unknown. This decision-making is due to people's lack of understanding of the stochastic laws of several possible objective States of market demand, which increases the uncertainty of decision-making.
[Editor] Decision research is a comprehensive discussion activity using system science, management science, behavioral science, Scientology, futurology and technical economics. It is the knowledge synthesis of the above subjects, which comprehensively studies the organization, management and decision-making problems in social systems of different levels and scales. Its research scope mainly focuses on science, technology and economy, decision-making, planning, management, scientific and technological methods, technology and engineering consulting. Its purpose is to provide model service and scientific measurement for management and decision-making at all levels. The main feature of its research method is to systematically analyze and demonstrate by combining qualitative and quantitative methods on the basis of full investigation and study, and to grasp the data truthfully, so as to get correct predictions and scientific decisions, guide the practice of all work and obtain ideal results. In the research of decision-making in sports field, it is very important to improve its effectiveness and reduce its mistakes.
[Editor] Decision analysis Decision analysis is generally divided into four steps:
(1) Form decision-making problems, including putting forward plans and determining objectives;
(2) judging the natural state and its probability;
(3) Draw up several feasible schemes;
(4) Evaluate the scheme and make a choice.
The commonly used decision analysis techniques are: decision analysis under certainty, decision analysis under risk and decision analysis under uncertainty.
Decision analysis under (1) certainty. Deterministic decision-making problems have four main characteristics:
One is that there is only one country,
Second, there is a clear goal that decision makers want to achieve.
Third, there are two or more options for decision makers to choose from.
Fourth, in this state, the income values of different schemes are clear.
Deterministic decision analysis techniques include differential method and mathematical programming to find the maximum value.
(2) Decision analysis under risk. The difference between this kind of decision-making problem and deterministic decision-making is only the first feature: in the case of risk, there are more than one possible state in the future, and it is impossible to know which state will appear in advance, only the probability, frequency, proportion or weight of each state. The commonly used risk-based decision analysis techniques are expected value method and decision tree method.
The expected value method is to determine the choice of each feasible scheme according to the probability average of the income value of each feasible scheme in each natural state.
Decision tree method helps decision makers visualize decision-making problems. It can simply draw all kinds of alternative schemes, possible states, possibilities and consequences on a picture for calculation, research and analysis, and can also supplement and analyze decisions under uncertain conditions at any time. If there is not only one state, and the possibility of each state is unknown, it is called decision under uncertainty.
Commonly used risk decision analysis methods are:
A. the standard of optimism. Optimistic decision makers are willing to fight for every opportunity to get the best results. The decision-making step is to select a maximum profit value from each scheme, and then select a maximum value from these maximum profit values, and the scheme corresponding to this maximum value is the selected scheme.
B. pessimistic standards. More pessimistic decision makers are always cautious and will think of the worst results. The decision-making step is to select a minimum income value from each scheme, and then select a maximum income value from these minimum income values, and the corresponding scheme is the optimal scheme. This is to find the most favorable scheme from the most unfavorable situation.
C. the standard of equal possibility. Decision makers know nothing about state information, so they treat them equally, that is, they think they are equally likely to appear. So we can make decisions according to the methods in the risk situation.
D. four-way five-step analysis table method. Taking confirmation, location, time and breadth as the vertical axis, and exploring problems, clarifying performance deviation, making the closest logical comparison, clarifying differences and clarifying changes as the horizontal axis for decision analysis.
[Editor] The role of decision-making in modern management Decision-making is the core content of management; Related to the performance of management; Is the main responsibility of managers.
[Editor] Connotation of decision-making principle: The information collected for decision-making must accurately and comprehensively reflect the internal laws and external relations of the decision-making object.
Principle of scientific feasibility: under the existing subjective and objective conditions, the decision must be feasible.
[Editor] The connection and difference between prediction and decision-making: prediction serves decision-making; Prediction runs through the whole process of decision-making.
Difference: Prediction focuses on the scientific analysis of objective things, while decision-making focuses on the scientific choice of favorable opportunities and goals. Prediction emphasizes objective analysis, decision-making highlights leadership art, prediction is the premise of scientific decision-making, and decision-making is the service object and realization opportunity of prediction.
[Edit] Decision Case Analysis [Edit] Leadership Decision Case Analysis Case:
There is a food factory in a prosperous area of a city, which has suffered long-term losses due to poor management. The leaders of the municipal government plan to transform it into a non-staple food wholesale market, which can not only solve the resettlement problem of laid-off workers after the bankruptcy of enterprises, but also facilitate the nearby residents. To this end, a series of preliminary preparations have been made, including project approval, land acquisition and demolition, and architectural planning and design. It never occurred to me that a foreign developer has taken the lead in investing in a comprehensive market not far from here. There is a large wholesale market for non-staple food in the comprehensive market, which is enough to meet the needs of nearby residents and retailers.
Faced with this situation, the leaders of the municipal government are in a dilemma: continuing to build a wholesale food market will inevitably lead to losses; If construction is stopped at this point, all previous investments will be wasted. In this case, the municipal government made a blind decision to build the factory building of the food factory into a residential area, which was developed by the developer, but failed to effectively compensate the employees of the original food factory, which caused the employees of the factory to be in trouble, and the employees of the factory could not solve the compensation problem after petitioning for a long time, which caused hidden dangers to urban stability.
Case study:
The leaders of this city solve the problem out of kindness, not only to solve the problem of sluggish production of enterprises, but also to solve the shopping problem of urban residents, and also to better arrange employees of enterprises. However, they made hasty decisions, failed to fully consider the various factors involved in the problem, and made further decisions when making mistakes, resulting in a very passive working situation and irreparable losses to employees. With leadership scientific analysis, this decision reflects the following problems:
(1) This case shows the importance of information principle in leadership decision-making. The main reason for this dilemma is that the information priority principle of leadership decision-making is not well adhered to. Information is the basis of decision-making, and sufficient, timely, comprehensive and effective information is the premise of scientific decision-making. Before deciding on the wholesale market project of non-staple food crystal, the leaders of the district government obviously lacked comprehensive and detailed market research and did not understand the comprehensive market under construction, especially the internal wholesale market of non-staple food. Therefore, blind decision-making, hasty horse, in trouble.
(2) This case reflects the importance of tracking decision. When the original decision-making plan is implemented, the subjective and objective conditions have changed greatly, and the original decision-making goal cannot be achieved, the original decision-making goal or plan should be fundamentally modified, which is tracking decision-making. When the objective situation changed greatly, the leaders of this city failed to analyze it carefully, but made new decisions hastily, and there were mistakes in decision-making tracking.
(3) There are different ways to get out of the predicament. For example, one is to meet the challenge and continue to build. However, it is necessary to investigate and study, revise and improve the original decision-making plan, so that the built wholesale market can surpass its competitors in scale, facilities, services and management in order to win in the market competition; The other is to make early decisions, fundamentally modify the original decision-making plan, re-examine, establish and demonstrate new projects, and implement the transformation to management. City leaders in the absence of project approval and demonstration of new projects, real estate development in this area, very casual.
(4) Failing to put people's problems in the first place. When leaders make decisions, the first problem to be solved is, in the final analysis, the problem of people, and dealing with the problem of good people is the key to the realization of leadership decisions. If we only consider the problem from the economic benefit, but ignore the solution of people's problems and pay no attention to people's ideological work at all, then the social problems and social contradictions caused may make the government pay a greater price.
[Editor] There is a saying in the five major business decision-making cases in chess: "One careless move will lose the game; Take the lead and everything will live. " It implies a truth that no matter what you do, success or failure depends on the correct decision. Scientific management decisions can make enterprises full of vitality and prosperity, while wrong management decisions will make enterprises passive and on the verge of danger. Throughout the world, business decisions have failed, and of course there are successful cases. We will get many useful inspirations from the following cases.
Case 1: 1985, the new car "Shag" produced by Malaysian state-owned heavy industry company and Japan's Mitsubishi Motors Company with a joint venture of US$ 280 million was grandly listed. The Malaysian government regards it as a "glorious product" of Malaysian industry. After the product was launched, sales quickly fell into a trough. After research, economists believe that all the parts of Shag cars are shipped from Japan. Due to the appreciation of the yen, its production costs soared, and Malaysia's own economic downturn, car sales were very small. In addition, the most important factor is that when the government decides to introduce this model, it mainly considers meeting domestic demand. Therefore, the technology does not meet the standards of advanced countries and cannot be exported. Due to the wrong decision-making in the target market, the beautiful dream that Shag car brought to Malaysian industry was only a flash in the pan.
This example shows that the premise of scientific management decision-making is to determine the decision-making objectives. As a standard for evaluating and monitoring the whole decision-making action, it constantly influences, adjusts and controls the process of decision-making activities. Once the goal is wrong, it will lead to decision failure.
Case 2: 1962, British and French airlines began to jointly develop Concorde supersonic passenger aircraft, which is characterized by high speed, luxury and comfort. After more than ten years of research and development, costing hundreds of millions of pounds, it was finally developed in 1975. With the passing of more than ten years, great changes have taken place. The energy crisis and ecological crisis threaten the western world, so passengers and many airlines have changed their requirements for passenger planes in flight. The passenger's request is that the fare should not be too expensive, and the airline's request is energy saving, more passengers and less noise. But Concord can't meet these requirements of consumers. First of all, it is noisy. It will make a lot of noise when flying, and sometimes even shatter the glass on the building. Then, due to the rapid growth of fuel prices, operating costs have also increased greatly. These conditions show that consumers will not have great demand for this kind of aircraft. Therefore, it should not be put into mass production. However, because the company has no decision-making operation control plan and no re-evaluation, and the aircraft is jointly developed by the two countries, a large number of people are hired to participate in this work. If they dismount halfway, a large number of people will be fired. The above situation makes it difficult to interrupt the decision-making of aircraft development and production. Later, the two countries debated whether to continue to cooperate in the development and production of this aircraft. However, due to the lack of decision-making operation control mechanism, they can only reluctantly implement the decision. As a result, the plane could not be sold after it was produced, and the original darling became an abandoned child.
This example shows that the decision-making operation control of an enterprise is closely related to the fate of the enterprise. The final success of a decision depends not only on the quality of the decision itself, but also on the control and adjustment of the decision operation, including the control in the process of decision implementation and the control in each stage of decision determination.
Case 3: In order to occupy the market in scale, IBM boldly decided to buy equity. 1982 bought 12% equity from Intel Corporation of the United States for $250 million, which was enough to meet the challenges of the computer industry at home and abroad; The other time, in 1983, it bought 0/5% equity of Rome Company, an American company specializing in the production of telecommunication equipment, for US$ 228 million, thus maintaining the "overlord" position of office automation equipment. For another example, as early as 1965, an American company invented a video cassette recorder. But American companies only use it to produce a very expensive special equipment for radio stations. The operator of Sony Corporation in Japan, through analysis and demonstration, saw that once the TV video recording device is mass-produced, its price will inevitably decrease, and many families can afford this video recording device. In this way, the market of household electronic products will expand. If we immediately develop and study home TV video recording devices, we will certainly get good economic and social benefits. Due to the success of this decision, Japan once occupied more than 90% of the home TV recording equipment market, while the United States was at a disadvantage for a long time.
This example shows that correct management decisions can make enterprises lead the way in the ever-changing market and remain invincible.
Case 4: 1960, AI okuka was promoted to vice president and general manager of Ford Company. He observed that a social innovation force, represented by young people, was formally formed in the 1960s, which will have an immeasurable impact on American society and economy. Ai okuka believes that the needs of young people should be put in the first place when designing new models. Under his careful organization, after many improvements, the new car was finally finalized at the end of 1962. It looks like a sports car, with a long nose and a short tail, which satisfies the psychology of young people who like sports and excitement. More importantly, the price of this kind of car is quite cheap, only about 2500 dollars, which ordinary young people can afford. Finally, this kind of car also took a name that made young people daydream-"Wild Horse". During the new york World Expo in April, 1964, "Wild Horse" officially appeared in the market. Prior to this, Ford made a big public opinion propaganda and set off a "wild horse" fever. In the first year of sales activities, customers bought 465,438+0.9 million "Mustang", which set a record for American automobile manufacturing. The appearance and great success of Wild Horse shows okuka's outstanding management decision-making ability. From then on, he became famous in American business circles and was honored as the president of Ford Motor Company.
This example shows that successful decision-making can expand sales, reduce costs, improve profits, and then occupy the market.
Case 5: In the early post-war period, Nisic Company in Japan only had more than 30 employees, producing rubber products such as raincoats, swimming caps, sanitary belts and diapers. Due to insufficient orders and unstable operation, the enterprise is in jeopardy. Tomokawa Bo, the chairman of the company, learned from the census that about 2.5 million babies are born in Japan every year. If each baby uses two diapers, it needs 5 million diapers a year, which is a considerable diaper market. Tokugawa Bo is determined to give up products other than diapers, turn Nisic into a professional diaper company, concentrate on building famous brands and become the "king of diapers". The capital is only 1 100 million yen, but the annual sales are as high as 7 billion yen.
Successful management decisions can also help enterprises avoid the danger of bankruptcy and turn defeat into victory. If an enterprise only relies on one product to conquer the world for a long time, it will inevitably hide the danger of stopping production and closing down, because the market is changeable and people's needs are changeable, which requires entrepreneurs to make decisions on the development of new products in order to meet the needs of the market. Once this decision is successful, it will make enterprises in a "waterless" situation feel "a bright future".