Management-Chapter 9 Flashcards
Decision Making
The process of identifying problems and opportunities and then resolving them
Decision
A choice made from available alternatives.
Programmed Decision
One made in response to a situation that has occurred often enough to enable managers to develop decision rules that can be applied in the future.
Non-programmed Decision
One made in response to a situation that is unique, is poorly defined and largely unstructured, and has important consequences for the organization.
Certainty
A situation in which all the information the decision maker needs is fully available.
Risk
A decision has clear-cut goals and good information is available, but the future outcomes associated with each alternative are subject to chance.
Uncertainty
Occurs when managers know which goals they want to achieve, but information about alternatives and future events is incomplete.
Ambiguity
A condition in which the goals to be achieved or the problem to be solve is unclear, alternatives are difficult to define, and information about outcomes is unavailable.
Classical Model
The ideal, rational approach to decision making which is based on the assumption that managers should make logical decisions that are economically sensible and in the organization’s best economic interests.
Normative
The classical model and it defines how a manager should make logical decisions and provides guidelines for reaching and ideal outcome.
Administrative Model
The concepts of bounded rationality and satisficing and describes how managers make decisions in situations that are characterized by uncertainty and ambiguity.
Descriptive
The administrative model is descriptive, an approach that describes how managers actually make decisions rather than how they should make decisions according to a theoretical model.
Bounded Rationality
Means that people have the time and cognitive ability to process only a limited amount of information on which to base decisions.
Satisficing
Means choosing the first alternative that satisfies minimal decision criteria, regardless of whether better solutions are presumed to exist.
Intuition
An aspect of administrative decision making that refers to a quick comprehension of a decision situation based on past experience but without conscious thought.
Coalition
An informal alliance among managers who support goal or solution.
Problem
A situation in which organizational accomplishments have failed to meet established goals
Opportunity
A situation in which managers see potential organizational accomplishments that exceed current goals
Diagnosis
The step in which managers analyze underlying causal factors associated with the decision situation.
Risk Propensity
Selection of an alternative depends partly on managers’ risk propensity, or their willingness to undertake risk with the opportunity of gaining an increased payoff.
Implementation
This step involves using managerial, administrative, and persuasive abilities to translated the chosen alternative into action.
Decision Styles
Differences among people with respect to how they perceive problems and make choices.
Brainstorming
A technique that uses a face-to-face group to spontaneously suggest a broad range of alternatives for making a decision.
Electronic Brainstorming
Brings people together in an interactive group over a computer network rather than meeting face to face.
Devil’s Advocate
A person who is assigned the role of challenging the assumptions and assertions made by the group to prevent premature consensus.
Point-Counterpoint
A group decision-making technique that breaks people into subgroups and assigns them to express competing points of view regarding the decision.
Groupthink
Refers to the tendency of people in groups to suppress contrary opinions in a desire for harmony.
Escalating Commitment
Refers to continuing to invest time and money in a decision solution despite evidence that it is failing.
