"If you care about what people think about you, you will end up being their slave. Reject and pull your own rope" rope ― Auliq Ice
Making Decision in Uncertain Conditions - An Idea Presented By - www.Tools4Management.com
Why Should you Deal with Uncertainties? Managers have to make decisions for the future of their organizations. Sometimes they have to make decisions when they are not aware either of the current conditions or the future results. As a manager, you can apply decision making tools and techniques to manage successfully in uncertain conditions. Dealing efficiently with uncertainty can help you avoid risks in future
Risk Identification • Financial risks - Economic losses resulting from change in policy, poor resource allocation, decrease or increase in price of commodity and interest rate fluctuation. • Strategic risks - Risks arising from the investments made to achieve objectives and mission. Include transaction risks, investor relation risks and macroeconomic risks. • Legal
risks
-
Risks
from
litigation
threats
in
laws and
regulations. • Operational risks - Risks arising from using low quality raw materials and due to production errors.
Risk Quantification In this stage, managers need to calculate the amount of money they have to invest in case a crisis or risk occurs. In general sense, risk is the result you get after adding the probabilities of a risky outcome and multiplying that with the loss you think you might incur.
Risk Management When risky activities are involved, the management should have the ability to transform, absorb and manage the risks. This process can tell you, if the organization can endure risks. If you realize that the organization has the ability to tolerate risks, you might take greater risks. Implement effective decision-making tools and techniques to know what you should do when there is uncertainty in the organization.
CONTACT US
Thank You