Transcript Lesson 1 Getting Started in PowerPoint

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part 1
Chapter 4
Chapter
Decision-Making Skills
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Learning Objectives
• Explain the difference between decision making and
problem solving.
• Compare and contrast intuitive and rational
approaches to decision making.
• Explain the decision maker’s environment and the
conditions for making a decision.
• Explain timing and participation as they relate to the
decision-making process.
• Identify methods for creative decision making.
• Discuss management information systems.
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Making Decisions
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All managers are decision makers
Not all decision makers are managers
Pervades all basic management functions
Manager’s decision process
Most of the time
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Decision Making
Versus Problem Solving
• Term confusion
• Decision making
• Various alternatives
• Problem solving
• Appropriate responses
• Problem solving involves decision making
• Decisions solve or avoid problems
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The Intuitive Approach
to Decision Making
• Hunches and intuition
• Problems can occur
• George Odiorne’s emotional attachments
– Leads to poor decisions
– Odiorne offers two suggestions:
• Become aware of biases
• Seek independent opinions
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Rational Approaches
to Decision Making
The Optimizing Approach
• The rational or scientific approach
• 6 steps
• Final decision
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Limitations of the
Optimizing Approach
• “Economic person”
• Based on 4 assumptions:
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People have clearly defined criteria
People have knowledge
People have the ability
People have self-discipline
• Due to limitations, most decisions still
involve some judgment
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The Satisficing Approach
• Herbert Simon – Principle of bounded
rationality
• Definite limits
• The decision model
• 4 assumptions
• Optimizing
• Satisficing
• Level of Aspiration
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The Decision Maker’s
Environment
• Higher-level = More flexibility
• Influences
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Patterns of authority
Purpose of organization
Formal and informal structure
Superiors and subordinates
• Successful managers must develop an
appreciation of different forces
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Conditions for Making Decisions
• Depends on what happens later
Certainty
• Situation of Certainty
Risk
• Situation of risk
• Precise Probabilities
• Expected value analysis
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Conditions for Making Decisions
Uncertainty
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Situation of uncertainty
No knowledge of probabilities
One of several approaches can be taken
Maximax approach
Maximin approach
Risk-averting approach
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Timing the Decision
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Need must be recognized
Quick decisions
Poor decisions
Never acting
Other types
Knowing when to make a decision is
complicated
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Participation in Decision Making
• Involving others
• Pertinent questions
Group or Team Decision Making
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Better than single person
Takes longer
Superior for two reasons
Less responsible
More “polar”
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Barriers to Effective
Decision Making
• Four basic barriers
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Complacency
Defensive avoidance
Panic
Deciding to decide
• Overall effectiveness
• Barriers must be dealt with
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Making Creative Decisions
The Creative Process
• Creativity
• Innovation
• Five-step process
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Preparation
Concentration
Incubation
Illumination
Verification
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Establishing a Creative
Environment
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Single most important influencing factor
Manger sets tone
People-based management skills
A manager must:
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Instill trust
Develop communication
Seek talent
Reward
Allow flexibility
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Tools to Foster Creativity
• Several Techniques
• Alex F. Osborn – Brainstorming
– Four basic rules
• William J. J. Gordon – Gordon Technique
– Key Word
• Brainwriting
– No discussion
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A Model for Creative
Decision Making
• Emphasis on new ideas
• 6 stages
– Recognition
– Fact Finding
– Problem Finding
– Idea Finding
– Solution Finding
– Acceptance finding
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Management Information
Systems
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MISs
Information provided
Data Processing
Transaction-processing systems
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