Principle of Decision Making


The various principles of decision making are:

1.       Principle of problem orientation: if manager becomes problem oriented rather than solution oriented he will be able to recognize the real problem or issue and then right solution can be searched out.

2.       Principal of exception: any decision which can be made by the subordinate should be left for him to make. The manager should policy decisions only, leaving the decisions relating to operational details to the subordinates.

3.       Principal of alternatives: only realistic or feasible alternatives should be analyzed fully and add or impractical or impossible alternatives should be summarily discarded. However, innovative alternatives may be objectively considered, especially keeping in mind the strengths and weaknesses of the enterprise and the opportunities and threats in the environment.

4.       Principal of limiting factors: this principal states that by recognizing and overcoming those factors that stand critically in the way of a goal, the best alternative course of the action can be selected. Recognizing the limiting factors in a given situation makes it possible to narrow the search for alternatives only to those alternatives that will overcome the limiting factors.

5.       Principal of bounded or limited rationality: this principal states that a manager must settle for bounded or limited rationally. Since the managers cannot be completely rational in practise, they should try to pick up a course of action that is satisfactory or good under the existing circumstances.

6.       Principal of commitment: for purposes of successful implementation of decisions, the manager should seek commitment and support of his subordinates to the decisions.

7.       Principal of participation: the manager should clearly understand that participation of subordinates in decision making process not only improves their quality but also in calculates in them a sense of commitment and support for such decisions. Hence participation in the decision making should for such decisions. Hence participation in decision making should be emphasized. Subordinates should be give proper opportunity to discuss the problem and to suggest and analyze the alternatives.

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