EM Extra Flashcards
A key to success in management and in your career is
knowing how to be an effective decision maker
—a choice among two or more alternatives
decision
an obstacle that makes it difficult to achieve a desired goal or purpose.
problem
are factors that are important to resolving the problem
decision criteria
choices that are logical and consistent and maximize value
Rational Decision Making
decision making that’s rational, but limited by an individual’s ability to process information
Bounded rationality
accepting solutions that are “good enough
satisfice
making decisions on the basis of experience, feelings, and accumulated judgment
Intuitive Decision Making
the systematic use of the best available evidence to improve management practice.
Evidence-based management (EBMgt)
a decision-making approach where you solicit ideas and input from a network of people outside of the traditional set of decision makers.
Crowdsourcing
straightforward, familiar, and easily defined problems
Structured problems
repetitive decisions that can be handled by a routine approach
Programmed decisions
a series of sequential steps used to respond to a well-structured problem
Procedure
an explicit statement that tells managers what can or cannot be done
rule
a guideline for making decisions
policy
problems that are new or unusual and for which information is ambiguous or incomplete
Unstructured problems
unique and nonrecurring and involve custom-made solutions
Nonprogrammed decisions
low tolerance for ambiguity and seek rationality
Directive style
seek rationality but have a higher tolerance for ambiguity
Analytic style
intuitive decision makers with a high tolerance for ambiguity
Conceptual style
intuitive decision makers with a low tolerance for ambiguity
Behavioral style
or “rules of thumb” can help make sense of complex, uncertain, or ambiguous information.
Heuristics
holding unrealistically positive
views of oneself and one’s performance
Overconfidence Bias
choosing alternatives that offer immediate rewards and avoid immediate costs
Immediate Gratification Bias
fixating on initial information and ignoring subsequent information
Anchoring Effect
selecting, organizing and interpreting events based on the decision maker’s biased perceptions
Selective Perception Bias
seeking out information that reaffirms past choices while discounting contradictory information
Confirmation Bias
selecting and highlighting certain aspects of a situation while ignoring other aspects
Framing Bias
losing decision-making objectivity
by focusing on the most recent events
Availability Bias
drawing analogies and seeing identical situations when none exist
Representation Bias
creating unfounded meaning out of random events
randomness bias
forgetting that current actions cannot influence past events and relate only to future consequences
Sunk Costs Errors
taking quick credit for successes and blaming outside factors for failures
Self-serving Bias
mistakenly believing that an event could have been predicted once the actual outcome is known (after-the-fact)
Hindsight Bias
the vast amount of quantifiable data that can be analyzed by highly sophisticated data processing
big data
uses computing power to solve complex problems
Artificial Intelligence (AI)
A method of data analysis that automates analytical model building.
Machine Learning
A subset of machine learning that use algorithms to create a hierarchical level of artificial neural networks that simulate the function of the human brain.
deep learning
The use of mathematics, statistics, predictive modeling, and machine learning to find meaningful patterns in a data set.
analytics
