Chapter 9

Question 1

Define rational decision making model (1)

Answer 1

• six step decision model that describe how individuals behave in order to maximize some outcome

Question 2

What are the six decision model (6)

Answer 2

• define the problem
• develop the criteria
• weigh the criteria
• seek for alternatives
• evaluate the alternatives
• select the best alternative

Question 3

Assumption of the model (5)

Answer 3

• problem clarity
• known option
• no time or time constraint
• clear preference
• maximizing pay off

Question 4

How do people actually make decisions (3)

Answer 4

• rationality
• intuition
• judgement shortcut

Question 5

Define bounded rationality (2)

Answer 5

• weigh the alternatives

- limitation of a person ability to interpret, process, and act on information

Question 6

Define satisfice (1)

Answer 6

• solution on both satisfactory and sufficient

Question 7

Define intuitive (1)

Answer 7

• nonconscious decision making process created by person experience

Question 8

Define judgement shortcut (1)

Answer 8

• systematic bias and avoid difficult tradeoff, people tend to rely heavily on gut feeling and experience

Question 9

Define overconfidence bias (1)

Answer 9

• tendency arise when individuals are overly optimistic on one’s own performance

Question 10

Define anchoring bias (1)

Answer 10

• tendency that is fixate on initial information and failure to adequately adjust subsequent information

Question 11

Define confirmation bias (1)

Answer 11

• tendency to seek out information to reaffirm past choice and discount information that contradicts past judgement

Question 12

Define availability bias (1)

Answer 12

• tendency that person base their judgement on the information that is readily available rather than compete data

Question 13

Define escalation of commitment (1)

Answer 13

• increase commitment on previous decision despite clear evidence that suggest decisions may have been incorrect

Question 14

Define randomness error (1)

Answer 14

• tendency that people believe that they can predict the outcome of random events (superstition)

Question 15

Define risk aversion (1)

Answer 15

• tendency to prefer a sure gin of moderate outcome rather than riskier outcome, even if the riskier outcome has highly expected pay off

Question 16

Define hindsight bias (1)

Answer 16

• tendency likely to believe falsely, after the outcome of event is known, that individuals could have have accurately predicted the outcome

Question 17

The strength of group making decision (3)

Answer 17

• complete skills and knowledge
• increase the acceptance of solution
• increase the diversity of views

Question 18

The weakness of group making decision (4)

Answer 18

• conformity pressure
• dominant of one or more members
• ambiguous responsibility
• time consuming

Question 19

Define groupthink (2)

Answer 19

• group agree above everything and shutdown individuals with ideas
• illusion of invulnerability, acceptance of morality, rationalized resistance, peer pressure, minimize doubt, illusion of unanimity

Question 20

How managers to minimize groupthink (4)

Answer 20

• monitor group size
• make leaders play an impartial role
• make one member play the devil advocate
• stimulate active discussion of diverse interaction to emphasize dissenting views

Question 21

Define groupshit (1)

Answer 21

• group take on either extreme risk or conservative that an individual would have liked

Question 22

Group decision techniques (4)

Answer 22

• nominal group technique
• interactive group
• electronic meeting
• brainstorming

Question 23

Define the three component model (1)

Answer 23

• individual has creativity when the requirement of expertise, creative thinking skills, and intrinsic task motivators

Question 24

Factor affect creativity (6)

Answer 24

• freedom
• challenge
• resources
• work group feature
• organization support
• supervisory encouragement

Question 25

Five features that block creativity (5)

Answer 25

• expected evaluation
• surveillance
• time
• competition
• external motivators : tangible rewards

Question 26

Four ethical decision criteria (5)

Answer 26

• utilitarianism: decisions are based on outcome or consequences that emphasize the greater good for the greatest number
• justice
• right
• care
• whistle blower: individual who reports unethical practices of employers to outsider

Question 27

Factor that influence ethical decision making behaviour (3)

Answer 27

• stage of moral development
• locus of control
• organization environment

Question 28

Define stage of moral development (4)

Answer 28

• development stages on a person capacity to make judgement that are morally right
• preconventional: follow the rules
• conventional: fufill obligation and what is expected
• principles: do what self thing is morally right

Question 29

Define locus of control (1)

Answer 29

• believe that outside influence has control over them

Question 30

Define organization environment (1)

Answer 30

• code of ethics

Question 31

How do you make ethical decisions (3)

Answer 31

• is the decision motivated by self serving interest
• does the decision respect the right of individual affected
• is the decision fair and equitable

Question 32

Define corporate social responsibility (1)

Answer 32

• organization responsibility to consider the impact on society