Decision Making Flashcards
What is the six step decision-making process
Define the problem, identify the criteria, allocate weights to the criteria, develop alternatives, evaluate the alternatives, select the best alternative
What is rational decision-making
It makes consistent, value maximizing choices within specified constraints
Six step decision-making process
How do individuals actually make decisions
Bounded rationality: limitations on one’s ability to interpret, process, and act on information
Satisficing: identifying a solution that is good enough
Intuition: non-conscious process created from distilled experience that results in quick decisions (relies on holistic associations)
Judgment shortcuts
Overconfidence bias: believing too much in our own ability
Anchoring bias: using early information as the basis
Confirmation bias: selecting and using only facts that support our decision
Availability bias: emphasizing information that is most readily at hand
Escalation of commitment: increasing commitment to a decision in spite of evidence that is wrong
Randomness error: creating meaning out of a random event/superstitions
Risk aversion: tendency to prefer a sure thing over a risky outcome
What is groupthink
Phenomenon in which the norm for consensus overrides the realistic appraisal of alternative courses of action
What is group shift
Phenomenon in which the initial position of individual members of a group of exaggerated toward a more extreme position
What are symptoms of groupthink and how to minimize groupthink
Illusion of invulnerability, pure pressure, minimize doubts, allusion of unanimity, assumption of morality, rationalized resistance
Monitor group size, encourage group leaders to play an impartial role, appoint one group member to play the role of devils advocate, stimulate active discussion of diverse alternatives to encourage dissenting views and more objective evaluations
What causes group shift
Discussion creates familiarization among group members, group discussion motivates individuals to take risks, group diffuses responsibility
What are some group decision-making techniques
Interacting groups, brainstorming, nominal group technique, electronic meetings
Four criterion for making ethical choices
Utilitarian criterion (greatest good), rights criterion, justice criterion, care criterion
What are the stages of moral development
Preconventional, conventional, principled
