MAM COLLEGE OF ENGINEERING AND TECHNOLOGY Siruganur, Tiruchirappalli-621105 Department of Civil Engineering MG-2 51!

"rinciple# of Management $nit %%

"art-& 1' Define ()*ective# Objectives are the goals, aims or purpose that organizations wish to achieve over varying periods of time. 2' Mention the characteri#tic of #oun+ polic, ` Characteristics of Sound policy Relationship to Organizational objective air amount of Clarity !ritten Consistency ' E-plain T(.S MatriT(.S Matri- "alternatively S.(T anal,#i# # is a structured planning method used to evaluate the Strengths, .ea$nesses, (pportunities, and Threats involved in a project or in a business venture. % S!O& analysis can be carried out for a product, place or person. /' Mention the )enefit# of M0( 1' Clarit, in organi1ation' '(O tends to force clarification in organization roles and structures. 2' Commitment '(O elicits commitment performance. )f the objectives are set by people who are responsible for achieving them, they have a sense of feeling that they are achieving their own objectives. 5' Define "lanning %ccording to *oontz and O+ ,onnell, -.lanning is an intellectual process, conscious determination of course of action, the basing of decision on purpose, facts and considered estimates.-

6' Mention +ifferent t,pe# of "lan

./%0S S&%0,)01 ./%0 S)01/2 3S2 ./%0S

'ission

.rogrammes

Objectives

.roject

.olicies

Schedules

Strategies 'ethods .rocedure 2' Define M0( Rules

(udgets

Standards

4'(O is a comprehensive managerial system that integrates many $ey managerial activities in a systematic manner and that is consciously directed towards the effective and efficient achievement of Organization and individual Objectives.5 6 .eter ,ruc$er

3' Define "olic, % policy is a general guide to thin$ing and action rather than a specific course of action. )t defines the area or limits within which decisions can be made to achieve organizational objectives. 2g7 8uality control policy,,ividend policy, 9R policy 4' Define )u+get# (udget is a type of plan which is e:pressed in numerical data 10' Define 5oreca#ting 4 orecasting is the formal process of predicting future events that will significantly affect the functioning of the enterprises.5

11' Define Strategie# ;Strategy is the comple: plan for bringing the organization from a given posture to a desired position in a future period of time<. or e:ample, if the management anticipates price=cut by competitors, it may decide upon a strategy of launching an advertising campaign to educate the customers and to convince them of the superiority of its products.

12' T,pe# of 5oreca#ting Techni6ue# a. ,emand forecast > sales forecast b. 2conomic orecast c. &echnological orecast 1 ' Define +eci#ion Ma7ing 4,ecision ma$ing is a process of selection from a set of alternative courses of action which is thought to fulfill the objective of the decision 6 problem more satisfactorily than others.5 = 9aynes ? 'assie ,ecision ma$ing involves selection of best course of action among different alternatives courses of action.

1/' .hat i# the importance of planning8 &o offset uncertainties, &o )ntegrate Resources ? %chieving .roductivity 15' Di#tingui#h )et9een "olicie# an+ "roce+ure# Sl.0 o @ A .olicy .olicy is formulated at &op /evels of 'anagement Reduces span of consideration and 1uides ,ecision ma$ing .rocedure .rocedures are carried out more at /ower /evels ,escribes how an action can be performed step by step

PART B

1. Discuss the nature and importance of Planning in detail.

Planning Meaning, Definition, Nature & Purpose

Meaning and Concept of Planning In simple words, A plan is a predetermined course of action to achieve a specified goal. Planning is deciding in advance what is to be done, when where, how and by whom it is to be done. Planning bridges the gap from where we are to where we want to go. It includes the selection of objectives, policies, procedures and programmes from among alternatives. It is an intellectual process characterized by thinking before doing. In short, it is a blueprint for action

Planning -Definitions

Definitions of Planning According to Koontz and ! "onnell, #Planning is an intellectual process, conscious determination of course of action, the basing of decision on purpose, facts and considered estimates.# According to Alford and $eatt, #Planning is the thinking process, the organized foresight, the vision based on fact and e%perience that is re&uired for intelligent action.#

According to 'heo (aimann ) #Planning is deciding in advance what is to be done. *hen a manager plans, he projects a course of action, for the future, attempting to achieve a consistent, co)ordinated structure of operations aimed at the desired results#.

Nature / Characteristics of Planning

Nature of Planning The nature of planning can be highlighted by studying its characteristics. They are as follows: (a) Planning is a intellectual activit .

Planning is not a simple process. It is an intellectual exercise and involves thinking and

forethought on the part of the manager.

(b)Planning is goal!oriente" reach

very plan specifies the goals to be attained in the future and the steps necessary to

them. ! manager cannot do any planning" unless the goals are known.

(c) Planning is for#ar" loo$ing

Planning is in keeping with the adage" #look before you leap$. Thus planning means looking ahead. It is futuristic in nature since it is performed to accomplish some ob%ectives in future.

(d)Planning %erva"es all &anagerial activit

Planning is the basic function of managers at all levels" although the nature and scope of planning will vary at each level.

(e)

Planning is t'e %ri&ar function .

Planning logically precedes the execution of all other managerial functions" since managerial activities in organi&ing' staffing" directing and controlling are designed to support the attainment of organi&ational goals. Thus" management is a circular process beginning with planning and returning to planning for revision and ad%ustment.

(f) Planning is (ase" on facts

Planning is a conscious determination and pro%ection of a course of action for the future. It is based on ob%ectives" facts and considered forecasts. Thus planning is not a guess work.

(g) Planning is fle)i(le

Planning is a dynamic process capable of ad%ustments in accordance with the needs and re(uirements of the situations. Thus planning has to be flexible and cannot be rigid.

(h) Planning is essentiall "ecision &a$ing

Planning is a choice activity as the planning process involves finding the alternatives and the selection of the best. Thus decision making is the cardinal part of planning.

(i) Planning is a continuous %rocess Planning is a continuous process and a never ending activity of a manager in an enterprise based upon some assumptions which may or may not come true in the future. Therefore" the manager has to go on modifying revising and ad%usting plans in the light of changing circumstances

Importance /Significance/Ad antages of Planning

*ignificance of Planning
According to Koontz and !"onnell, #*ithout planning, business becomes random in nature and decisions become meaningless and adhoc choices. According to +.,. 'erry, -Planning is the foundation of most successful actions of all enterprises.. An enterprise can achieve its objectives only through systematic planning on account of the increasing comple%ities of modern business. 'he importance and usefulness of planning can be understood with reference to the following benefits.

1.

!eduction of "ncertaint#

/uture is always full of uncertainties. A business organisation has to function in these uncertainties. It can operate successfully if it is able to predict the uncertainties. 0ome of the uncertainties can be predicted by undertaking systematic. 0ome of the uncertainties can be predicted by undertaking systematic forecasting. 'hus, planning helps in foreseeing uncertainties which may be caused by changes in technology, fashion and taste of people, government rules and regulations, etc.

2.

$etter "tili%ation of !esources

An important advantage of planning is that it makes effective and proper utilization of enterprise resources. It identifies all such available resources and makes optimum use of these resources.

3.

Increases &rgani%ational 'ffecti eness

Planning ensures organizational effectiveness. 1ffectiveness ensures that the organisation is in a position to achieve its objective due to increased efficiency of the organisation.

4.

!educes the Cost of Performance

Planning assists in reducing the cost of performance. It includes the selection of only one course of action amongst the different courses of action that would yield the best results at minimum cost. It removes hesitancy, avoids crises and chaos, eliminates false steps and protects against improper deviations.

5.

Concentration on &()ecti es

It is a basic characteristic of planning that it is related to the organizational objectives. All the operations are planned to achieve the organizational objectives. Planning facilitates the achievement of objectives by focusing attention on them. It re&uires the clear definition of objectives so that most appropriate alternative courses of action are chosen.

*elps in Co-ordination

+ood plans unify the interdepartmental activity and clearly lay down the area of freedom in the development of various sub)plans. 2arious departments work in accordance with the overall plans of the organisation. 'hus, there is harmony in the organisation, and duplication of efforts and conflict of jurisdiction are avoided.

!.

Ma+es Control 'ffecti e

Planning and control are inseparable in the sense that unplanned action cannot be controlled because control involves keeping activities on the predetermined course by rectifying deviations from plans. Planning helps control by furnishing standards of performance.

".

'ncouragement to Inno ation

Planning helps innovative and creative thinking among the managers because many new ideas come to the mind of a manager when he is planning. It creates a forward)looking attitude among the managers.

#.

Increase in Competiti e Strength

1ffective planning gives a competitive edge to the enterprise over other enterprises that do not have planning or have ineffective planning. 'his is because planning may involve e%pansion of capacity, changes in work methods, changes in &uality, anticipation of tastes and fashions of people and technological changes etc.

1$. Delegation is ,acilitated

A good plan always facilitates delegation of authority in a better way to subordinates.

2. %hat are the steps in&ol&ed in Planning' ()plain

Steps in ol ed in Planning

Planning is a process which embraces a number of steps to be taken. Planning is an intellectual e%ercise and a conscious determination of courses of action. 'herefore, it re&uires courses of action. 'he planning process is valid for one organisation and for one plan, may not be valid for other organizations or for all types of plans, because various factors that go into planning process may differ from organisation to organisation or from plan to plan. /or e%ample, planning process for a large organisation may not be the same for a small organisation. (owever, the major steps involved in the planning process of a major organisation or enterprise are as follows3

-. $eing A/are of &pportunities Although it precedes actual planning and is therefore not strictly a part of the planning process, an awareness of opportunities in the e%ternal environment as well as within the organization is the real starting point for planning. All managers should take a preliminary look at possible future opportunities and see them clearly and completely, know where their company stands in light of its strengths and weaknesses, understand what problems it has to solve and why, and know what it can e%pect to gain. 0etting realistic objectives depends on this awareness. Planning re&uires a realistic diagnosis of the opportunity situation.

0.'sta(lishing o()ecti es 'he first and primary step in planning process is the establishment of planning objectives or goals. "efinite objectives, in fact, speak categorically about what is to be done, where to place the initial emphasis and the things to be accomplished by the network of policies, procedures, budgets and programmes, the lack of which would invariably result in either faulty or ineffective planning. It needs mentioning in this connection that objectives must be understandable and rational to make planning effective. $ecause the major objective, in all enterprise, needs be translated into derivative objective, accomplishment of enterprise objective needs a concrete endeavor of all the departments. 1. Consideration of Planning Premises Planning premises are assumptions about the future understanding of the e%pected situations. 'hese are the conditions under which planning activities are to be undertaken. 'hese premises may be internal or e%ternal. Internal premises are internal variables that affect the planning. 'hese include organizational polices, various resources and the ability of the organisation to withstand the environmental pressure. 1%ternal premises include all factors in task environment like political, social technological, competitors! plans and actions, government policies, market conditions. $oth internal factors should be considered in formulating plans. At the top level mainly e%ternal premises are considered. As one moves downward, internal premises gain importance. 2. Determining Alternati e Courses 'he ne%t logical step in planning is to determine and evaluate alternative courses of action. It may be mentioned that there can hardly be any occasion when there are no alternatives. And it is most likely that alternatives properly assessed may prove worthy and meaningful. As a matter of fact, it is imperative that alternative courses of action must be developed before deciding upon the e%act plan. 3. ' aluation of Alternati es (aving sought out the available alternatives along with their strong and weak points, planners are re&uired to evaluate the alternatives giving due weight)age to various factors involved, for one alternative may appear to be most profitable involving heavy cash outlay whereas the other less profitable but involve least risk. 4ikewise, another course of action may be found contributing significantly to the company!s long) range objectives although immediate e%pectations are likely to go unfulfilled. 1vidently, evaluation of alternative is a must to arrive at a decision. therwise, it would be difficult to choose the best course of action in the perspective of company needs and resources as well as objectives laid down. 4. Selecting a Course of Action 'he fifth step in planning is selecting a course of action from among alternatives. In fact, it is the point of decision)making)deciding upon the plan to be adopted for accomplishing the enterprise objectives. 5. ,ormulating Deri ati e Plans 'o make any planning process complete the final step is to formulate derivative plans to give effect to and support the basic plan. /or e%ample, if Indian Airlines decide to run 5umbo 5ets between "elhi an Patna, obliviously, a number of derivative plans have to be framed to support the decision, e.g., a staffing plan, operating plans for fuelling, maintenance, stores purchase, etc. In other words, plans do not accomplish themselves. 'hey re&uire to be broken down into supporting plans. 1ach manager and department of the organisation is to contribute to the accomplishment of the master plan on the basis of the derivative plans.

6. 7uantif#ing Plans (# $udgeting

After decisions are made and plans are set, the final step in giving them meaning, as was indicated in the discussion on types of plans, is to &uantify them by converting them into budgets. 'he overall budget of an enterprise represents the sum total of income and e%penses, with resultant profit or surplus, and the budgets of major balance sheet items such as cash and capital e%penditures. 1ach department or program of a business or some other enterprise can have its own budgets, usually of e%penses and capital e%penditures, which tie into the overall budget. If done well, budgets become a means of adding the various plans and set important standards against which planning progress can be measured.

8. ,eed(ac+ or ,ollo/-up Action /ormulating plans and chalking out of programmes are not sufficient, unless follow)up action is provided to see that plans so prepared and programmes chalked out are being carried out in accordance with the plan and to see whether these are not kept in cold storage. It is also re&uired to see whether the plan is working well in the present situation. If conditions have changed, the plan current plan has become outdated or inoperative it should be replaced by another plan. A regular follow)up is necessary and desirable from effective implementation and accomplishment of tasks assigned. 'he plan should be communicated to all persons concerned in the organisation. Its objectives and course of action must be clearly defined leaving no ambiguity in the minds of those who are responsible for its e%ecution. Planning is effective only when the persons involved work in a team spirit and all are committed to the objectives, policies, programmes, strategies envisaged in the plan.

3. Discuss the different t*pes of Plans

9#pes of Planning/9echni:ues of Planning/'lements of Planning

)n the process of planning several specific plans are prepared which may broadly be classified into two categories7 Standing and Single =3se plans.

P)!*+ +T!*,I*- P)!* +I*-) .+ P)!*+

/ission

Programmes

0b%ectives

Pro%ect

Policies

+chedules

+trategies /ethods Procedure 2ules

1udgets

+tandards

ST&:D%:G ";&:<

Standing plan or multi=use plans are the recurring plans and they are used repeatedly in situation of a similar nature. % standing plan is a standing guide to recurring problem and it is used again and again. )t is also called long= term plans. 1' Mi##ion7
&he ;mission< as a type of plan e:plains the most fundamental purpose of an enterprise. or e:ample i. &he mission of the government of a country might be eradication of poverty. ii. &he mission of a manufacturing enterprise might be producing high Buality goods for the common men of society at the most affordable price and so on.

2' ()*ective#7

Objectives provide a sense of direction to the thin$ing process of the plannerC and to the action process of the operators of the plan Objectives must be formulated $eeping in view= i. &he mission of the enterprise, and ii. &he resources and limitation of the enterprise. Objectives are $nown by different names, e.g goals, aims, purpose, mission, targets, etc. *inds of objectives7 @. 'ar$et standing A. )nnovation D. .roductivity E. .hysical and financial resources F. .rofitability G. 'anager performance and development H. !or$er performance and attitude and .ublic responsibility "olicie#<

% policy is a general guide to thin$ing and action rather than a specific course of action. )t defines the area or limits within which decisions can be made to achieve organizational objectives.

.olicies are routines to the realization of objectives. .olicies decide the line of action along which subordinate e:ecutives are e:ecuted to wor$

% .olicy might be defined as a statement of guidance and instructionC which defines and confines the area of discretion of subordinates in matters of decision=ma$ing.
E-ample< % policy of the mar$eting manager to e:tend credit to customers for a ma:imum period of DI days, authorizes salespersons to e:tend credit to their customers for any period say, a wee$, a fortnight, AI or AF daysC but in no case for a period beyond DI days, which amounts to the boundary line of policy of credit to customers.

Strategie#<
&he concept of strategy in business has been borrowed from military organization. ;Strategy is the comple: plan for bringing the organization from a given posture to a desired position in a future period of time<. or e:ample, if the management anticipates price=cut by competitors, it may decide upon a strategy of launching an advertising campaign to educate the customers and to convince them of the superiority of its products.

"roce+ure#< % procedure is a chronological seBuence of steps to be underta$en to enforce a policy and to attain an objectives, % procedure, as a type of management plan, specifies the manner of handling an organizational activity=in terms of various steps to be underta$en. &he essence of a procedure is the chronological "i.e order of time# seBuence of actions. or e:ample, there might be specific procedure for handling inward mail< procedure for e:ecuting orders of customersC procedure for employees to proceed on to leave and so on, for various other organizational activities.

Metho+<
'ethods are usually found in the technical aspects of the functioning of an enterprise, li$e manufacturing accounting, cost accounting, research etc.

=ule#< Rules are rigid and definite plans that specify what is to be done or not done in given situation. % rule provides no scope for discretion and judgment.
)t is a prescribed guide to conduct or action. % rule may or may not be a part of a procedure. &he rule ;no smoking in the factory is not a part of any procedure. (ut the rule that ;all orders must be acknowledged with 48 hours of their receipt is a part of the procedure for processing orders.

"rogramme<
% programme is a plan of action=indicating what wor$ is to be done to carry out a particular objectives. or e:ample, to popularize the product, there is a need for an advertising programme. %gain, to improve the s$ills of personnel in performing their jobsC

"ro*ect#<
% programme is actually, a part of some programme of the enterprise. )t is, in a way, a special type of programme=being either of a technical nature reBuire e:pertise in e:ecution or of a financial nature involving huge capital outlays= 2:ample, i. 2stablishment of a new factory ii. ;training projects<

Sche+ule#<
% schedule specifies time limits within which activities are to be completed. Scheduling is the process of establishing a time seBuence for the wor$ to be done. % Schedule is essential for avoiding delays and for ensuring continuity of operations.

% schedule lays down a timetable fi:ing starting and finishing dates for different activities 0u+get#<
% budget might be defined as any plan, e:pressed in numerical terms e.g units of output man= hours, machines, sales=targets, e:pense estimates in money terms or revenue estimates money terms etc.

Stan+ar+<
% standard serves as a yardstic$ to measure the actual with the estimates. Standard refers to a criterion. )t is helpful to find out the variation and deviations. 2very organization fi: a standard for each section. i:ing a standard for each section helps organization to find out whether they have reached the target fi:ed.

>in+# of planning< 0u#ine## plan<

Business plan or divisional plan7 .hilips=co &J division, electronic calculator, spare parts etc. Functional plan7 production dept plan, mar$eting department plan etc. Regional or geographic plan7 branches in several region Corporate plan7 plan for a whole enterprise.

(n the )a#i# of perio+ coverage7 Long range plan7 it covers a long period in future e.g F or @I years. )t is also called strategic or standing plan. !hort range plan7 it covers a short period, usually one year. )t is also called tactical plan.

"lanning to accompli#h #pecific goal#7 "roduct planning "ro#ect planning7 setting up a new factory. $ctivity planning

4. ()plain +anagement ,* -,.ecti&es /ith its merits and limitations.

M&:&GEME:T 0? (0@ECT%AES< BM0(C

&he philosophy of management by objectives "'(O# was highlighted in @KFE by .eter . ,ruc$er who stressed upon the need for 4 management by objectives and self=control5. '(O may be defined as a process in which a manager and his subordinates jointly decide the targets and results to be achieved $eeping in view the overall objectives of the organization, jointly identify the *ey Results %reas "*R%# periodically evaluate the actual results in terms of results agreed upon in advance.

Definition < 4'(O is a comprehensive managerial system that integrates many $ey managerial activities in a systematic manner and that is consciously directed towards the effective and efficient achievement of Organization and individual Objectives.5 .eter ,ruc$er

"roce## of M0(

"roce## or #tep of M0( 3. Goal Setting< &he 4irst phase in the /10 process is to define the 0rgani&ational 0b%ectives. These are determined by the top management and usually in consultation with other managers. 0nce these goals are established" they should be made known to all the members. In setting ob%ectives" it is necessary to identify #5ey 2esult !reas$ (52!) 6. Manager-Su)or+inate involvement< %fter the 0rgani&ational -oals are defined" the subordinates work with the managers to determine their individual goals. In this 7ay" everyone gets involved in the goal setting. 8. Matching goal# an+ re#ource#< /anagement must ensure that the subordinates are provided with necessary tools and materials to achieve these goals. !llocation of resources should also be done in consultation with the subordinates. 9. %mplementation of "lan< !fter the ob%ectives are established and resources are allocated" the subordinates can implement the plan. If any guidance of clarification is reBuired, they can contact their supervisors. :. =evie9 an+ &pprai#al of "erformance< This step involves periodic view of progress between manager and the subordinates. +uch reviews would determine if the progress is satisfactory or the subordinate is facing problems. Performance appraisal at these reviews should be conducted" based on fair and measurable standards. Merit#< @. 0etter managing.

a. '(O helps in better managing the organization. )f forces management to thin$ of planning for results. b. Objectives also force managers to thin$ how these can be achieved and what resources would reBuire. 2' Clarit, in organi1ation' a. '(O tends to force clarification in organization roles and structures. ' Commitment a. '(O elicits commitment performance. )f the objectives are set by people who are responsible for achieving them, they have a sense of feeling that they are achieving their own objectives. /' Delp# in &pprai#al a. '(O provides the measurement criteria to judge where one stands. So that corrective actions. )f reBuired, can be ta$en well in time. Demerit#< @. 5ailure to teach the philo#oph,. '(O seems to be easy on its face, but there is much to be understood and appreciated by managers. 2' "ro)lem of goal #etting &ruly verifiable goals are difficult to set '(O reBuires verifiable goals. Buantified goal setting for staff people is Buite difficult. or e:ample,

' Empha#i# on #hort-run goal#< )n most of the organizations practicing '(O, there is a tendency to emphasis short=run goals. /' %nfle-i)ilit,< Sometimes '(O presents the danger of infle:ibility in the organization. F. .a#tage of time< '(O involves a wastage of a lot of valuable time of managers in joint consultationsC and they left with little time for efficiently discharging their duties

5. ()plain the process of decision ma0ing and different t*pes of decision ma0ing Techni1ues.
"=(CESS (5 DEC%S%(: M&>%:G7

@. Definition of the +eci#ion ma7ing pro)lem7 )t is essential for the decision ma$er to find and define the problem the problem before he ta$es any decision. 9e manager should ta$e care of many factors in defining the problem. Sufficient time should be spent on defining the problem. 2' Collection of +ata< % decision as good as the adeBuacy and Buality of data are on which it is based. %ccordingly management should proceed to collect necessary data for decision= ma$ing purposes.

Service of ')S in this regard may prove to be highly useful and valuable.

' Development of alternative#< &his step usually guided by S!O& analysis. %ccordingly, management must develop those alternativeC which= =Capitalize on the strengths of the company =Overcome its wea$nesses>limitation =/ead to best e:ploitation of environment opportunities. ='anage threats successfully. /' Evaluation of alternative#< %fter development of alternative is critically evaluated in terms of its merits and limitations= to get at the ;net worth< of each alternative. &he following criteria for evaluation= =Ris$ and resource implication associated with each alternative. =Cost=benefit analysis for each alternative. F. Selection of the )e#t alternative7 )n ma$ing a selection of the best alternative, management may base its decision on any of the following two bases7 - 2:perience "e:perience managers ta$e better decision# - 2:perimentation. "% sample of decision may be put to implementation on a trial basis# G. %mplementation of the +eci#ion7 % decision remains only a ;paper=decision<C unless and until it is put into practice. &he following managerial aspects, to be ta$en care of7 - Communication of decision to those who are to implement it - 'a$ing all resources and facilities available to the operators of the decisions - 'otivating people to implement the decision with enthusiasm. - 2:ercising general supervision over the implementation of the decision. 2' 5ollo9-up or fee+)ac7 action< &he implementation of decision leaves certain information for the decision=ma$ing process. &he result of decision=e:ecution can imply two sets of information. i. &hat the decision=ma$ing process was right and should be continued. ii. that the decision=ma$ing was wrong and or should be enriched with new ways and techniBues.

Decision Ma$ing Tec'ni+ues Personal Decision Ma$ing Tec'ni+ues, ; Rational-Logical Decision Mo"el. 4ocuses on facts and logic and minimi&es intuitive %udgments.

; ;

Intuitive Decision Mo"el. -ut decision makers rely on their feelings and hunches and avoid statistical data. Pre"is%ose" Decision Mo"el. ! manager who decides on a solution and then gathers the information to support the decision.

Grou% Decision Ma$ing Tec'ni+ues .rainstor&ing ; ; ; ; ; ; -roup effort to generate ideas and alternatives to sei&e an opportunity. <=36 people gathered free from interruptions. Participants are given a topic" either barrier>problem or a new product>market" and are told that no idea or suggestion is too ridiculous. The facilitator encourages a free flow of ides until all opinions have been presented. 2ecord the ideas on flipchart to keep in front of everyone. !fter the meeting" the ideas are sorted by a group of managers.

No&inal Grou% Tec'ni+ue ; ?reate a structure to provide e(ual" yet independent" participation by all members. 3) ,efine the problem by the group leader. 6) ach participant writes down their ideas about the problem with no discussion.

8) 2ound 2obin Presentation. ach person is allowed to present their idea with no discussion. The ideas are recorded on a flipchart for all to see. 9) The group conducts an open discussion of all ideas to clarify and provide explanations. :) ! secret ballot as members voting for the best idea. The lowest average ranking is eliminated. <) The group asks (uestions of each other about the remaining solutions. @) 4inal vote in a secret ballot. The highest total is adapted.

Del%'i Tec'ni+ue 3) The problem is stated to a group of experts in a (uestionnaire. ach member is asked to provide solutions without interacting. 6) ach expert returns the completed (uestionnaire.

8) ! summary of opinions is developed. The summary is distributed to the experts with a second (uestionnaire.

9)

xperts now complete the second (uestionnaire with the benefits of the other expertAs opinions.

:) The process continues until the experts reach a consensus.

A"vantages of Grou% Decision Ma$ing ; ; ; ; 1ring a broader perspective. ,iversity brings a richer perspective. 7hen people participate" they are more likely to support the results. The ability to answer (uestions reduces uncertainty.

Disa"vantages of Grou% Decision Ma$ing ; ; ; ; ; Time consuming. The decision reached may be a compromise rather than an optimal outcome. -roupthink is when individuals become committed to the group and are reluctant to disagree with other members. -roups generally have difficulty taking the initiative. *o one person has responsibility for the decision.

/uantitative Decision Ma$ing Tree

Decision Trees = ! graphical representation of the actions a manager can take and how these actions relate to the event. Pa (ac$ Anal sis = ! techni(ue that ranks alternatives according to how long each takes to pay back its initial cost. *i&ulations B .sing mathematical techni(ues to solve management problems and aid decision making.