Decision Making: Identifying Problems, Solutions, and Steps for Effective Decision Making , Study notes of Introduction to Business Management

Download Decision Making: Identifying Problems, Solutions, and Steps for Effective Decision Making and more Study notes Introduction to Business Management in PDF only on Docsity! Decision Making Defining the following:  Problem  a discrepancy between and existing and desired state  Solution  a tactic perceived to be capable of closing the gap between the existing and the desired state if implemented  Problem Solving  the process of identifying a gap that needs to be closed and the characteristics of appropriate solutions  Decision Making  the process of evaluating alternative solutions and then selecting the “best” alternative to be implemented Keys to Problem Solving Two frequent problems Jumping to the identification of solutions before the problem is understood Stopping the identification of solutions too soon Decision Implementation  Putting a decision into action; conveying the decision to the persons who will be affected by it and getting their commitment to it “Rational” Decision Making Rational – Describes choices that are consistent and value- maximizing • Expected Value • Elimination by Aspects – using single criteria to eliminate unneeded options Bounded rationality – Behavior that is rational within the parameters of a simplified or constrained model that captures the essential features of a problem • Satisfiying • Garbage Can Model Decision Making Under Risk Uncertainty – A condition under which there may be full knowledge of what variables will influence outcomes, but the expected probability of their values cannot be determined. Ambiguity – A condition under which the decision-maker is unable to determine or unsure of the factors likely to influence outcomes or the nature of their influence. What is the Role of Creativity? Source: T. M. Amabile, “Motivating Creativity in Organizations,” California Management Review (Fall 1997): 43. Creativity The ability to produce novel and useful ideas Group Decision Making l Advantages – Make more accurate decisions – Provides more complete information – Offers a greater diversity of experiences and perspectives – Generates more alternatives – Increases acceptance of a solution – Increases the legitimacy of a decision. l Disadvantages – Is more time-consuming and less efficient – Minority domination can influence decision process – Increased pressures to conform to the group’s mindset (groupthink) – Ambiguous responsibility for the outcomes of decisions