Individual Decision Making in Organizations

Question 1

Intuition

Answer 1

the ability to have a grasp on a situation or information without the need for reasoning

Question 2

rational decision making

Answer 2

when individuals use analysis, facts and a step-by-step process to come to a decision

Question 3

Rational Model

Answer 3

• define the problem
  
  • Identify the decision criteria
  • Allocate weights to the criteria
  • develop alternatives
  • evaluate the alternatives
  • select the best alternative

Question 4

Optimize

Answer 4

select the best alternative

Question 5

Vroom_Yetton-Jago Normative Decision Model

Answer 5

explains the differences between authoritative, consultative, and democratic types of leadership. Five forms of leadership decision making

Question 6

5 forms of Vroom_Yetton-Jago Normative Decision Model

Answer 6

• Decide (autocratic decision I)
• Consult individually (autocratic decision II)
• Consult group (consultative decision I)
• Facilitate (Consultative II)
• Delegate (Group Decision)
• Final Decision

Question 7

Decide (autocratic decision I)

Answer 7

Manager makes the decision alone without outside consultation and then sells the decision to the group.

Question 8

Consult individually (autocratic decision II)

Answer 8

Manager solicits opinions from each member of his staff individually and then still makes the final decision by himself

Question 9

Consult group (consultative decision I)

Answer 9

Manager describes the issue to all employees in a meeting and listens to their input. He then makes the final decision by himself

Question 10

Facilitate (Consultative II)

Answer 10

Manager presents the issue to the group in a meeting and acts a the moderator.

Question 11

Delegate (Group Decision)

Answer 11

Manager allows the group to decide on the final outcome. Manager has no real input and the problem is given the group to solve

Question 12

Decision making

Answer 12

selection of a procedure to weigh alternatives and find a solution to a problem

Question 13

Directive

Answer 13

relies on a rational and autocratic style that results in the employee using his own knowledge, experience and judgment to choose the best alternative

Question 14

Conceptual

Answer 14

focuses on long-term results, brainstorming or alternatives, creative approaches to problem solving and taking higher risks

Question 15

Analytical

Answer 15

use direct observations, facts and data to determine the best outcome

Question 16

Behavioral

Answer 16

the leader will explain the problem and alternatives to the group with pertinent information and the negotiate

Question 17

Common biases

Answer 17

prejudices or decisions that are not fair and balanced

Question 18

Types of biases

Answer 18

• Overconfidence bias
  
  • Hindsight bias
  • anchoring bias
  • Confirmation bias
  • availability bias
  • escalation of commitment

Question 19

Overconfidence bias

Answer 19

having a higher confidence of capabilities and successes than actual skills and experiences will support

Question 20

Hindsight bias

Answer 20

falsely believing that they predicted the result of a decision after the outcome was known

Question 21

anchoring bias

Answer 21

relying too heavily on one piece of information in making their final decision

Question 22

Confirmation bias

Answer 22

when managers only use data that will confirm their decision

Question 23

availability bias

Answer 23

thinking something will occur because of examples in the past that come to mind easily

Question 24

escalation of commitment

Answer 24

selling and marketing bad products just because of high initial investment

Question 25

Types of judgement errors

Answer 25

randomness error | risk aversion

Question 26

randomness error

Answer 26

creating meaning out of a random events based on false information or superstition

Question 27

risk aversion

Answer 27

accepting minimal success to stay at low risk