Chapter 2 Flashcards
What is the first step in the decision-making process?
Identify a Problem
A problem is an obstacle that makes it difficult to achieve a desired goal or purpose.
What is the second step in the decision-making process?
Identify Decision Criteria
Decision criteria are factors that are important to resolving the problem.
What is the third step in the decision-making process?
Allocate Weights to the Criteria
This step involves prioritizing the criteria by weighting them according to their importance.
What is the fourth step in the decision-making process?
Develop Alternatives
This involves listing viable alternatives that could resolve the problem.
What is the fifth step in the decision-making process?
Analyze Alternatives
This step involves appraising each alternative’s strengths and weaknesses.
What is the sixth step in the decision-making process?
Select an Alternative
The alternative with the highest total weight is chosen.
What is the seventh step in the decision-making process?
Implement the Alternative
This step involves putting the chosen alternative into action and gaining commitment from those who will carry it out.
What is the eighth step in the decision-making process?
Evaluate Decision Effectiveness
This involves judging the soundness of the decision based on its outcomes.
Define rational decision-making.
Describes choices that are logical and consistent while maximizing value.
What are the assumptions of rationality in decision-making?
- The decision maker is fully objective and logical
- The problem is clear and unambiguous
- The decision maker has a clear goal and knows all possible alternatives and consequences
What is bounded rationality?
Decision-making that is rational but limited by an individual’s ability to process information.
What does ‘satisfice’ mean?
Accepting solutions that are ‘good enough.’
What is escalation of commitment?
An increased commitment to a previous decision despite evidence it may have been wrong.
What is intuitive decision-making?
Making decisions based on experience, feelings, and accumulated judgment.
Define evidence-based management (EBMgt).
The systematic use of the best available evidence to improve management practice.
What are structured problems?
Straightforward, familiar, and easily defined problems.
What is a programmed decision?
A repetitive decision that can be handled by a routine approach.
What is a procedure in decision-making?
A series of sequential steps used to respond to a well-structured problem.
What is an unstructured problem?
Problems that are new or unusual and for which information is ambiguous or incomplete.
What is a nonprogrammed decision?
Unique and nonrecurring decisions that involve custom-made solutions.
Define certainty in decision-making conditions.
A situation in which a manager can make accurate decisions because all outcomes are known.
What is risk in decision-making?
A situation in which the decision maker can estimate the likelihood of certain outcomes.
What is uncertainty in decision-making?
A situation in which a decision maker has neither certainty nor reasonable probability estimates available.
What is a linear thinking style?
A tendency to use external data/facts and process information through rational, logical thinking.
