Decision Making Tools

• Quantitative Analysis

  Logic

  Historical Data

  Marketing Research

  Scientific Analysis

  Modeling
• Qualitative Analysis

  Emotions

  Intuition

  Personal Experience and Motivation

  Rumors
• Alternative – a course of action or strategy that may be chosen by the decision maker.
• State of nature – an occurrence or a situation over which the decision maker has little or no control.
• Decision tables are a concise visual representation for specifying which actions to perform depending on a given condition.
• Certainty - environment in which relevant parameters have known values.
• Risk - environment in which certain future events have probable outcomes.
• Uncertainty - environment in which it is impossible to assess the likelihood of various future events.
• Expected monetary value (EMV) criterion - best-expected value among the alternatives.
• Maximin - choose the alternative with the best of the worst possible payoffs.
• Maximax -choose the alternative with the best possible payoff.
• Laplace - choose the alternative with the best average payoff of any of the alternatives.
• Minimax regret - choose the alternative that has the least of the worst regrets.
• A decision tree is a flowchart-like structure that illustrates the sequence of choices that need to be made and the potential outcomes associated with each choice.
• Root Node - the starting point of the decision tree
• Internal Nodes - or decision nodes, when a sub-node splits into further sub-nodes
• Leaf or Terminal Nodes - are the end points of the tree, representing the final decision or classification based on the sequence of choices made throughout the tree.
• Splitting - It is a process of dividing a node into 2 or more sub-notes
• Total - Made up of the whole.
• Quality - Degree of excellence a product or service provides.
• Management - Act, art, or manner of handling, controlling, directing, etc.
• Total Quality Management (TQM) - is the art of managing the whole to achieve excellence.
• TQM involves methodology for continually improving the quality of all processes, it draws on a knowledge of the principles and practices of:

  • The behavioural sciences
  • The analysis of quantitative and non-quantitative data
  • Economics theories
  • Process analysis
• 1950s - Joseph M. Juran taught the concepts of controlling quality and managerial breakthrough.
• Armand V. Feigenbaum ’s book total Quality management was published.
• Philip B. Crosby ’s Promotion of zero defects paved the way for quality improvement in many companies.
• 1968 - Kaoru Ishikawa ’s synthesis of the philosophy contributed to Japan’s ascendancy as a quality leader.
• TQM is the name for the philosophy of a broad and systemic approach to managing organizational quality.
• Quality, according to ISO (International Standardization Organization), is the adaptation and conformity to the requirements that the standard itself, and customers, establish.
• Quality assurance is a way of ensuring that the operational quality standards and requirements, already established, are used in all future development processes, whether of a product or service.
• Quality Control - this concept is aimed at fulfilling the quality requirement, and is mainly carried out through inspections
• Quality management is the coordination of activities in production processes and services so that they are performed with quality.
• 7 PRINCIPLES OF QUALITY

  1. FOCUS ON CUSTOMERS
  2. LEADERSHIP
  3. PEOPLE'S COMMITMENT
  4. APPROACH THROUGH PROCESSES
  5. CONTINUOUS IMPROVEMENT
  6. RELATIONSHIP MANAGEMENT
  7. FACT-BASED DECISION-MAKING
• Focus on customers

  • Customers are stakeholders in your business, and developing products and services designed for them is a vital strategy for the growth of any company.
• Leadership is the ability to lead a team in a tactical and targeted manner, so that the team can perform its tasks with quality.
• People’s commitment

  • The participation and commitment of everyone, including top management members, contributes to an effective Quality Management System.
• Approach through processes

  • This principle is directly related to knowledge, the way a company manages its processes and how it achieves the results planned beforehand.
• The continuous improvement of services and products can, and should, be employed in the organizational culture.
• FACT-BASED DECISION-MAKING

  • Decision-making based on information, allows the security and efficiency of the actions taken, because with the help of performance indicators, it is possible to analyze which factors are contributing to good results and which ones require more attention and improvement points.
• A set of processes, policies, and procedures that ensures an organization consistently delivers products or services that meet or exceed customer expectations.

  QUALITY MANAGEMENT SYSTEM