Chapter 7: Individual and Group Decision Making Flashcards
Decision
A choice made from among available alternatives
Decision making
The process of identifying and choosing alternative courses of action
Rational model of decision making
Also called the classical model; the style of decision making that explains how managers should make decisions; it assumes that managers will make logical decisions that are the optimal means of furthering the organization’s best interests
Problems
Difficulties that inhabit the achievement of goals
Opportunities
Situations that present possibilities for exceeding existing goals
Diagnosis
Analyzing the underlying causes
Nonrational models of decision making
Models of decision-making style that explain how managers make decisions; they assume that decision making is nearly always uncertain and risky, making it difficult for managers to make optimum
Bounded rationality
One type of nonrational decision making; the ability of decision makers to be rational is limited by numerous constraints
Hubris
Extreme and inflated sense of pride, certainty, and confidence
Satisficing model
One type of nonrational decision-making model; managers seek alternatives until they find one that is satisfactory, not optimal
Intuition
Making a choice without the use of conscious thought or logical inference
Ethics officers
Individuals trained in matters of ethics in the workplace, particularly about resolving ethical dilemmas
Decision trees
Graph of decisions and their possible consequences, used to create a plan to reach a goal
Data analytics
Process of examining data sets in order to draw conclusions about the information they contain
Big data
Stores of data so vast that conventional database management systems cannot handle them
Autonomous devices
Collect data from situations to make calculations, define probabilities, and make reason-based decisions according to programmed goals
Artificial intelligence (AI)
The ability of a computer system to perform tasks that normally require human intelligence
Robotic process automation (RPA)
When robots act like a human inputing and extracting information
Predictive analytics
Category of data analysis that makes predictions about future outcomes based on historical data and analytics techniques
Machine learning
An extension of predictive analytics, occurs when systems or algorithms automatically improve themselves based on data patterns, experiences, and observations
Decision-making styles
Styles that reflect the combination of how an individual perceives and responds to information
Heuristics
Strategies that simplify the process of making decisions
Availability bias
The use of information readily available from memory to make judgments
Representative bias
The tendency to generalize from a small sample or a single event
Confirmation bias
Biased way of thinking in which people seek information to support their point of view and discount data that do not support it
Sunk-cost bias
Way of thinking in which managers add up all the money already spent on a project and conclude it is too costly to simply abandon it; also called the sunk-cost fallacy
Anchoring and adjustment bias
The tendency to make decisions based on an initial figure
Overconfidence bias
Bias in which people’s subjective confidence in their decision making is greater than their objective accuracy
Hindsight bias
The tendency of people to view events as being more predictable than they really are
Framing bias
The tendency of decision makers to be influenced by the way a situation or problem is presented to them
Escalation of commitment bias
When decision makers increase their commitment to a project despite negative information about it
Categorical thinking bias
Tendency of decision makers to classify people or information based on observed or inferred characteristics
Sham participation
Occurs when powerless, but useful individuals are selected by leaders to rubber stamp decisions and work hard to implement them
Groupthink
A cohesive group’s blind unwillingness to consider alternatives. This occurs when group members strive for agreement among themselves for the sake of unanimity and avoid accurately assessing the decision situation
Goal displacement
The primary goal is subsumed to a secondary goal
Minority dissent
Dissent that occurs when a minority in a group publicly opposes the beliefs, attitudes, ideas, procedures, or policies assumed by the majority of the group
Consensus
General agreement; group solidarity
Brainstorming
Technique used to help groups generate multiple ideas and alternatives for solving problems; individuals in a group meet and review a problem to be solved, then silently generate ideas, which are collected and later analyzed
Electronic brainstorming
Technique in which members of a group come together over a computer network to generate ideas and alternatives
Project post-mortem
A review of recent decisions in order to identify possible future improvements
