We all have to make decisions from time to time and, I must say, this is not an easy task. But it is much more difficult for those who are forced to make choices for the whole organization (department of the company). It is impossible to do without assessing the effectiveness and quality of management decisions.
Indicators and criteria for the effectiveness of economic decisions
To talk about the quality of management decisions, it is necessary to determine the concept of the effectiveness of solutions and its types. In the economy, efficiency is the ratio of the firm's performance. Usually they are characterized by the profit and the amount of money spent on obtaining it. But one economic assessment of the economic effectiveness of management decisions can not be said, because decisions are made in almost all areas of the firm. Therefore, there are several types of efficiency.
- Organizational effectiveness can be manifested in changing the working functions of employees, improving working conditions, optimizing the organizational structure of the enterprise, reducing the number of employees, creating a new department, etc.
- The social effectiveness of managerial decisions can be to create conditions for the creative work of employees, improve customer service, reduce staff turnover, improve the psychological climate in the team.
- Technological efficiency can be expressed in the introduction of modern technologies in production, the acquisition of new equipment, the improvement of labor productivity.
- Environmental efficiency can be expressed in providing security for employees, environmental safety of the company.
- Legal efficiency consists in ensuring security, legality and stability of work, reducing penalties.
Evaluation of the effectiveness of management decisions
There are many methods of evaluating efficiency, they are classified according to the complexity of the execution, the nature of the work performed, the accuracy of the results obtained, the volume of costs, etc. That is why the evaluation of the effectiveness of managerial decisions is entrusted to a group of highly qualified specialists. Let's consider the basic methods of an estimation of efficiency of administrative decisions.
- The method of comparison consists in comparing the planned indicators with the actual values. It allows to detect deviations, their causes and methods for eliminating deviations.
- The index method is needed when evaluating complex phenomena that can not be broken down into elements. Allow to evaluate the dynamics of processes.
- The balance method consists in comparing the interrelated indicators. It gives an opportunity to reveal the influence of various factors on the activities of the organization and to find reserves.
- The graphical method is used in cases where a graphic illustration of the firm's activities is necessary.
- FSA (functional-cost analysis) is a systematic approach to research in order to increase the impact (useful effect).
Methods to improve the effectiveness of management decisions
You can talk a lot about methods to improve the effectiveness of management decisions, but by and large there are two of them - improving the development of solutions and increasing control over the implementation of the solution.
After all, if the decision does not bring the desired result or brings it not to the full, then either its development has made mistakes, or something has been confused by the performers. And you can find out only by conducting a detailed analysis of the management decision. Evaluation, as we found out, is not an easy and expensive task (especially if we involve outside experts), therefore, we must carefully consider the stages of developing the solution, and monitor the order of its execution. And also it is necessary to be able to intelligently communicate the idea of innovation to employees, so that there is no misunderstanding.