Ch 2 Managerial Decision Making Flashcards
Daily managerial/business decisions impact _______ & _______
Organizations and stakeholders
Decisions range from ______ to _______
predictable to unexpected
Top management decisions affect __________
the future
Lower level management decisions affect _______
departments/workers
Systems of decision-making in the brain
Reflective System
Reactive System
Logical
Analytical
Deliberate
Methodical
Reflective System
The reflective system is located in what part of the brain?
Prefrontal cortex (front of brain)
Quick
Impulsive
Intuitive
Emotion-driven
Reactive System
The reactive system is located in what part of the brain?
Basal ganglia and amygdala
Self-awareness
Self-recognition
Empathy
Social skills
Emotional Intelligence
Repeated decisions with known or estimable criteria. Routine or low-involvement decisions.
Programmed Decisions
Managers use _________ for efficiency
Heuristics (mental shortcuts)
Programmed decisions are aligned with the _______ system of the brain
reactive
Novel and unstructured decisions with ambiguous criteria
Non-programmed Decisions
Non-programmed decisions are aligned with the ______ system of the brain. Requires thoughtful judgement and creative thinking.
reflective
Barriers that make effective decision-making difficult
- Bounded Rationality
- Escalation of Commitment
- Time Constraints
- Uncertainty
- Personal biases/confirmation bias
Full rationality limited by:
- inability to know every alternative
- incomplete information
- cognitive constraints
- finite time and mental capacity
Bounded Rationality
Tendency to stick with poor decisions even when outcomes are negative
Escalation of commitment
Limited time
Time constrains
Many decisions made without knowing the outcomes of alternatives
Uncertainty
Paying more attention to information that aligns with beliefs and ignoring contradicting information
Personal Bias / Confirming Bias
Necessary decisions may involve interpersonal _______
Conflict
Disagreements on goals/solutions
Beneficial Conflict (Process Conflict)
Personal disputes and attacks
Harmful Conflict (relationship conflict)
Choosing the first acceptable solution
Satisficing
