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Formal vs Informal
- Formal- Specific Objectives and Goals
- Informal- little written down
- Provides Direction
- Reduces impact of change
- Minimizes waste and redundancy and sets standards to facilitate control
Management by Objectives
- 1) Goals must be specific
- 2) Manager and subordinates must agree on goals
- 3) Each objective must have time constraint
- 4) Provide constant feedback on progress on goals
- 1) Identify Problem
- 2) ID decision criteria
- 3) Develop alternatives
- 4) Analysis of alternatives
- 5) Selection of alternative
- 6) Implement
- 7) Evaluation
Heuristic-encouraging a person to learn
Availability vs Representative
- Available- decisions based on readily available information/internet
- Representative- look at others who are successful and attach better than average odds.
Contingency approach to Decision Making
- Programmed- decisions made on well structured routine problems that occur every day
- Un-programmed- once a while decisions
Decisions making styles
- Directive-Low Tolerance for Indefinite, Rational (men)
- Analytic- High tolerance for Indefinite, Rational
- Conceptual- Many alternatives, High tolerance for Indefinite, Long term Solution, Intuitive
- Behavioral- Intuitive, Low tolerance for Indefinite
Advantages/Disadvantages Group Decision Making
- more complex info
- different points of view
- generate alternatives
- Higher acceptance of decision
- Higher legitimacy
- Group think
- Ambiguous responsibility
- Minority domination
What was Asch Studies?
10 student experiment on Group Conformity
6 elements of Structure in an Organization
- Work Specialization- each discrete step of a job done by diff. individual rather than 1 indiv. do whole job.
- Unity of Command- Principle that no employee should report to more than one boss
- Span of Control - # of employees a manager can effectively and efficiently manage
- Authority- rights for manager to give orders and expect them to be followed
- Responsibility- obligation to perform assigned activities
- Centralization- higher the level where decisions are made
- Decentralization - decision making authority to lowest levels in organization
- Departmentalization- grouping of activities in organization by function, product, customer, geography, or process
Group of people who all perform the same function in the same department (Acct. & Fin.)
Departmentalization focuses on different products within an organization.
- Divide area into territories
Links units around certain skills to complete task
- Customer- Group organization around certain customers
- The Matrix
Mechanist- looks for stable environment; Routine; Efficiency;Change is Slow
Organic-Always Changing; Loose Structure
Formalization- Deals w amount of rules; Formal; standard operating procedures Ex. Military
Use Strategies for?
Strategy is to raise revenue or lower your cost to increase profits
Types of Production
- Unit Production- Organic
- -Production of Single Units
- Mass production- Mechanistic
- Continuous Process Production- Machinery
Drawbacks to Over Planning
- Creates Rigidity-no freedom to experience better ways
- Tough to Plan- for a dynamic environment
10 Characteristics of Organization Culture degrees
- 1) Member Identity-employee 2 organization
- 2) Group Emphasis- work activities organized around groups
- 3) People Focus- Management decisions are focused on employees
- 4) Unit integration- encouraged to operate in a coordinated, interdependent manner
- 5) Control- rules, regulations, and direct supervision used to oversee and control employee behavior
- 6) Risk Tolerance-encouraged to be aggressive, innovative, and risk seeking
- 7) Reward Criteria- allocation of salary increases/promos, on performance rather than seniority, favoritism, or any other non performance factors
- 8) Conflict Tolerance- employees encouraged to air conflicts and criticisms openly
- 9) Means End Orientation-
- 10) Open Systems Focus-Monitoring and respond 2 changes in external environment
Actions of a Bounded-Rational decision maker.
- Construct simplified models that extract features from problems w/o capturing complexity.
- Act rational within the simplified model.
Two types of decision problems and Two types of decisions
- Well-structured and Ill-Structured.
- Well-Structured- straightforward, familiar, easily defined, and solved using Programmed decisions such as procedures, rules, and policies.
Ill Structured are new, unusual or incomplete information
that are solved using Nonprogrammed decisions.