Principles of Management Notes March 15th: Decision Making
Principles of Management Notes March 15th: Decision Making BCOR 2001
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This 3 page Class Notes was uploaded by Robin Silk on Sunday March 20, 2016. The Class Notes belongs to BCOR 2001 at University of Colorado at Boulder taught by Emily Edwards and Kevin McMahon in Winter 2016. Since its upload, it has received 21 views. For similar materials see Principles of Marketing and Management in Business at University of Colorado at Boulder.
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Date Created: 03/20/16
March 15th Decision Making 1. The Unconscious Mind a. Used to make quick decisions b. When people are allowed to just “think” through problems, they usually utilize their unconscious mind 2. Decision Making a. Programed Decision Making i. Routine; Automatic decision making that follows rules and guidelines 1. Based on experience 2. Little ambiguity b. Common Sense i. What to eat, wear, how to cross the street etc. ii. Behaving in a reasonable way c. Non Programmed Decision Making i. Occurs in response to unusual, unpredictable opportunities and threats ii. No readymade decision rules can be applied iii. Intuition might be used to solve these problems 1. Feelings, personal beliefs, hunches etc. iv. Reasoned judgement might be used 3. The Classical Model a. Flawed model i. Assumes that decision makers have all relevant information readily available ii. Assumes managers possess the mental facility to process all information 4. Administrative Model a. Satisfactory decisions are usually made instead of optimum decisions i. Bounded rationality 1. Too many alternatives, too much information ii. Incomplete information 1. Time and cost constraints iii. Satisficing (Incomplete information) 5. Pareto Principle a. 80% 20% rule b. Influences decision making i. How to focus resources ii. Identify your star employees iii. Focus on regular patrons/customers 6. Decision Making Process a. 7 Steps involved i. Recognize the need for a decision ii. Generate alternatives iii. Assess alternatives 1. Consider legal, ethical, economical, and practical elements iv. Choose among alternatives v. Implement the chosen alternative vi. Learn from feedback 7. Group Decision Making a. Potential Benefits i. Diverse ideas ii. Different skills and abilities iii. Greater acceptance iv. Managers can process more information v. Probability of idea implementation b. Potential Problems i. Wasted time ii. Disruptive conflict iii. Group leader intimidation iv. Groupthink 1. “The Abilene Paradox” a. Everyone goes along because they think it’s what the group wants 2. This can be countered with “Devil’s Advocacy” a. Analyzing the strengths and weaknesses of an alternative before implementation 3. Brainstorming can be used a. Sharing ideas and generating alternatives i. No ideas is a bad one b. Production blocking might be an issue i. Lost productivity because of all the alternatives c. Nominal group technique can be used to counter this i. Decision making by rank ordering alternatives d. Delphi Technique i. Decision making by written response e. 136ing i. Brainstorm individually and then in larger and larger groups 8. Entrepreneurship and Creativity a. Entrepreneurs i. Notice opportunities and decide how to mobilize necessary resources to produce new and improved goods and services b. Social entrepreneurs i. Focus on social problems to improve society c. Intrapreneurship i. Creative decision making within an organization that gives way to new/improved goods or services d. Characteristics of Entrepreneurs i. High on openness to experience 1. Daring; willing to take risk ii. High internal locus of control iii. High level of self esteem iv. High need for achievement
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