Problem Identification : Methods
1) Deviation from Past Performance
I took to the past for symptoms of problems in the present.
Employee turnover increases
Sales Decline
Sales expenses increase
More defective units are produced
MB 014 – History of Management, Case Study
2) Deviation from the Plan
New products fails to meet its market share objective
Profit levels are lower than planned
Construction of a new plant is far off schedule
3) Criticism
Customer dissatisfaction with new product / with their delivery
schedule
Union presents grievances
Investment firms may not recommend the organization as a
good investment opportunity
4) Competition
Organization’s competitors for resources & clients
A competitor introduces a superior new product
Problem Identification : Evaluating Alternatives
1) Conditions of Risk
50 % chance of capturing the youth market with new product
Actuarial tables used by insurance companies
Probabilities will be reasonalble accurate for a great number of cases over the long run
2) Conditions of uncertainty
Decision maker – no idea of the probabilities associated with the
various alternatives
Institution, Judgment & personality of the decision maker play an
important role
3) Multiple & Conflicting objectives
Competitiveness objective of a high quality product & an
efficiency objective of low maintenance costs
Profitability objective v/s Social responsibility
4) Optimal solutions are often impossible
Managers can in no way be aware of every possible alternative
Most managers are therefore not "Optimizers" but "Satisfiers".
1) Deviation from Past Performance
I took to the past for symptoms of problems in the present.
Employee turnover increases
Sales Decline
Sales expenses increase
More defective units are produced
MB 014 – History of Management, Case Study
2) Deviation from the Plan
New products fails to meet its market share objective
Profit levels are lower than planned
Construction of a new plant is far off schedule
3) Criticism
Customer dissatisfaction with new product / with their delivery
schedule
Union presents grievances
Investment firms may not recommend the organization as a
good investment opportunity
4) Competition
Organization’s competitors for resources & clients
A competitor introduces a superior new product
Problem Identification : Evaluating Alternatives
1) Conditions of Risk
50 % chance of capturing the youth market with new product
Actuarial tables used by insurance companies
Probabilities will be reasonalble accurate for a great number of cases over the long run
2) Conditions of uncertainty
Decision maker – no idea of the probabilities associated with the
various alternatives
Institution, Judgment & personality of the decision maker play an
important role
3) Multiple & Conflicting objectives
Competitiveness objective of a high quality product & an
efficiency objective of low maintenance costs
Profitability objective v/s Social responsibility
4) Optimal solutions are often impossible
Managers can in no way be aware of every possible alternative
Most managers are therefore not "Optimizers" but "Satisfiers".
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