Card Set Information
Decision Making Process
A set of eight steps that includes identifying a problem, selecting a solution, and evaluating the effectiveness of the solution.
Steps of decision making process
1-Identification of a problem
2-Identification of decision criteria
3-Allocation of weights to criteria
4-Development of Alternatives
5-Analysis of alternatives
6-Selection of an Alternative
7-Implementation of the Alternative
8-Evalutation of decision Effectiveness
A discrepancy between an existing and a desired state of affairs.
Factors that are relevant in a decision
Putting a decision into action
Judgmental shortcuts or "rules of thumb" used to simplify decision making
Decision makers think to know more than they do or hold unrealistically positive views of themselves and their performance.
Immediate Gratification bias
Decision makers who tend to want immediate rewards and to avoid immediate costs.
When decision makers fixate on initial information as a starting point and then, once set fail to adequately adjust for subsequent information.
Selective perception bias
When decision makers selectively organize and interpret events based on their biased perceptions.
Decision makers who seek out information that reaffirms their past choices and discount information that contradicts past judgements.
When decision makers select and highlight certain aspects of a situation while excluding others
when decision makers tend to remember events that are the most recent and vivid in their memory.
when decision makers assess the likelihood of an event based on how closely it resembles other events or sets of events
when decision makers try to create meaning out of radom events
Sunk costs error
when decision makers forget that current choices can't correct the past
tendency for decision makers to falsely believe that they would have accurately predicted the outcome of an event once that outcome is actually known.
decision makers who are quick to take credit for their successes and to blame failure on outside factors
Rational decision making
Describes choices that are consistent and value-maximizing within specified constraints.
Making decisions that are rational within the limits of a manager's ability to process information.
Accepting solutions that are "good enough"
Escalation of commitment
An increased commitment to a previous decision despite evidence that it may have been a poor decision
Intuitive decision making
Making decisions on the basis of experience, feelings, and accumulated judgment
How do problems differ?
A straightforward, familiar, and easily defined problem
A problem that is new or unusual for which information is ambiguous or incomplete
A repetitive decision that can be handled using a routine approach
A series of interrelated, sequential steps used to respond to a structured problem
An explicit statement that tells employees what can or cannot be done.
A guideline for making decision
A unique and nonrecurring decision that requires a custom-made solution
A situation in which a decision maker can make accurate decisions because off outcomes are known
A situation in which a decision maker is able to estimate the likehood of certain outcomes
A situation in which a decision maker has neither certainty not reasonable probability estimates available
What are the disadvantages of group decision making?
-Pressures of conform
When a group exerts extensive pressure on an individual to withhold his or her different views in order to appear to be in agreement
How can you improve group decision making?
-Nominal group technique
An idea-generating process that encourges alternatives while withholding criticism
Nominal group tecnhique
A decision making technique in which group members are physically present but operate independently
A type of nominal group technique in which participants are linked by computer
Japanese consensus-forming group decisions
The ability to produce novel and useful ideas
Model process that individual creativity essentially requires
-Creative thinking skills
-Intrinsic tash motivation