Infosheet4 decisionmaking

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  • 1. Decision Making and Levels of Decisions Margaret F. Bello Instructor
  • 2. Decision Making Programmed Decision Routine, virtually automatic decision making that follows established rules or guidelines. Managers have made the same decision many times before Little ambiguity involved 7-2
  • 3. Decision Making Non-Programmed Decisions Nonroutine decision made in response to unusual or novel opportunities and threats. The are no rules to follow since the decision is new. Decisions are made based on information, and a managers intuition, and judgment. 7-3
  • 4. Decision Making Intuition feelings, beliefs, and hunches that come readily to mind, require little effort and information gathering and result in on-the-spot decisions 7-4
  • 5. Decision Making Reasoned judgment decisions that take time and effort to make and result from careful information gathering, generation of alternatives, and evaluation of alternatives 7-5
  • 6. Step 1. Define the Problem 1. 2. Start by writing down your initial assessment of the problem. Dissect the problem. What triggered this problem (as Ive assessed it)? Why am I even thinking about solving this problem? What is the connection between the trigger and the problem? G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 6
  • 7. Step 2. Clarify Your Objectives 1. 2. 3. 4. 5. Write down all the concerns you hope to address through your decision. Convert your concerns into specific, concrete objectives. Separate ends from means to establish your fundamental objectives. Clarify what you mean by each objective. Test your objectives to see if they capture your interests. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 7
  • 8. Step 3. Identify Alternatives 1. 2. 3. 4. Generate as many alternatives as you can yourself. Expand your search, by checking with other people, including experts. Look at each of your objectives and ask, how? Know when to stop. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 8
  • 9. Step 4. Analyze the Consequences Mentally put yourself into the future. 1. Process Analysis Solving problems by thinking through the process involved from beginning to end, imagining, at each step, what actually would happen. Eliminate any clearly inferior alternatives. 3. Organize your remaining alternatives into a table (matrix) that provides a concise, bird's-eye view of the consequences of pursuing each alternative. 2. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 9
  • 10. Consequence Matrix G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 10
  • 11. Step 5. Make a Choice Analyses are useless unless the right choice is made. Under perfect conditions, simply review the consequences of each alternative, and choose the alternative that maximizes benefits. In practice, making a decisioneven a relatively simple one like choosing a computerusually cant be done so accurately or rationally. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 11
  • 12. How To Make Better Decisions Increase Your Knowledge 1. Ask questions. Get experience. Use consultants. Do your research. Force yourself to recognize the facts when you see them (maintain your objectivity). Use Your Intuition 2. A cognitive process whereby a person instinctively makes a decision based on his or her accumulated knowledge and experience. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 12
  • 13. Are You More Rational or More Intuitive? Source: Adapted and reproduced by permission of the Publisher, Psychological Assessment Resources. Inc., Odessa FL 33556, from the Personal Style Inventory by William Taggart, Ph.D., and Barbara Hausladen. Copyright 1991, 1993 by PAR, Inc. April 4, 2006 LIS580- Spring 2006 FIGURE 32 G.Dessler, 2003 13
  • 14. How To Make Better Decisions (contd) 3. Weigh the Pros and Cons 4. Dont Overstress the Finality of Your Decision 5. Quantify realities by sizing up your options, and taking into consideration the relative importance of each of your objectives. Remember that few decisions are forever. Knowing when to quit is sometimes the smartest thing a manager can do. Make Sure the Timing Is Right G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 14
  • 15. Decision Matrix Use weights to provide adjustments for importance of criteria Often subjective, but helps to prioritize FIGURE 33 G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 15
  • 16. Creativity and Decision Making Creativity The process of developing original, novel responses to a problem. Brainstorming Creativity A creativity-stimulating technique in which prior judgments and criticisms are specifically forbidden from being expressed in order to encourage the free flow of ideas which are encouraged. Creativity skills Expertise Task motivation Nominal group technique A decision-making technique in which group members are physically present but operate independently G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 16
  • 17. Nominal Group Technique Each participant contributes individual ideas Ideas are then ranked individually Totals are summed for final rank http://www.ryerson.ca/~mjoppe/ResearchProcess/841TheNominalGroupTechnique.htm April 4, 2006 LIS580- Spring 2006 17
  • 18. Checklist 3.4 How to be More Creative Create a culture of creativity. Encourage brainstorming. Suspend judgment. Get more points of view. Provide physical support for creativity. Encourage anonymous input. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 18
  • 19. Decision-making Shortcuts and Traps Using a Heuristic Applying a rule of thumb or an approximation as a shortcut to decision making. Anchoring Unconsciously giving disproportionate weight to the first information available. Adopting a Psychological Set The tendency to rely on a rigid strategy or approach when solving a problem. Perception (Personal Bias) The unique way each person defines stimuli, depending on the influence of past experiences and the persons present needs and personality. G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 19
  • 20. Organizational Learning and Creativity Creativity The ability of the decision maker to discover novel ideas leading to a feasible course of action. A creative management staff and employees are the key to the learning organization. 720
  • 21. Senges Principles for Creating a Learning? Figure 7.8 721
  • 22. Self-Check: Using Creativity to Find a Solution * Create a decision matrix to find alternative solutions to the problem: Choosing a course for college Source: Applied Human Relations, 4th ed., by Benton/Halloran cW 1991. Reprinted by permission of Prentice-Hall, Upper Saddle River, NJ. FIGURE 36 G.Dessler, 2003 April 4, 2006 LIS580- Spring 2006 22