Making Management

Decisions

Ch. # 13

Nazma Iqbal
Reg. # 1432-308061

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INTRODUCTION
Factor to be evaluated
Evaluating resource requirement
Skills requirements
Capacity requirements
Financial requirements
The degree of change in resource requirement
Evaluating Degree of Fit
Financial Evaluation
Evaluation of Risk
Flexibility

Evaluation
Evaluation literally means determining the
value of something (options)

Factors to be Evaluated
Resource Requirements:
What resources would be needed to implement the
option, and how does this requirement match up to
individual capabilities?
Skills Requirements:
What technical or human skills are required to
implement the option?
Capacity Requirements:
What are the capacity requirements over the
evaluation period?
Factors to be Evaluated
Resource Requirements:
Financial Requirements:
What are the funding or cash requirements
over the evaluation period.
Degree of Change in Resource
Requirements:
Decision making may vary in different
organizations in terms of skills necessary i.e.
the level of operating capacity and funding
requirements. Smooth operation maintaining
perfect or ideal balance can only be feasible.



Evaluating Degree of Fit
Option should not be evaluated in isolation
from the normal day to day activity of an
organization. If an option is eventually
chosen, it will have to be implemented
alongside the existing activities of the
organization.
Financial Evaluation
Any financial evaluation involves predicting
and analyzing the financial costs to which an
option would commit the manager, and the
financial benefit which might accrue from the
decision. In fact, the word cost has to be
defined a little more before it becomes a
usable concept for decision evaluation
Evaluation Risk
The risk inherent in any decision option can
be as a result of the decision makers inability
to predict or estimate:
The internal effects of an option within the
organization, or
The environmental conditions, prevailing after
the decision is taken, or
The reaction of other bodies within the
environment to the decision.
Evaluating the Effect on Future
Flexibility
some decisions cannot be viewed as being
totally independent of other decisions. One
way in which decision influence other
decisions , is by constraining the range of
options or room for man oeuvre in future
decision ,