TheManagerasaDecisionMaker,LearningObjectives,LearningObjectives,14,TheNatureofManagerialDecisionMaking,Decisionmakingisapartofallmanagersjob,Processbywhichmanagersrespondtoopportunitiesandthreatsbyanalyzingoptions,andmakingdecisionsaboutgoalsandcoursesofaction,Decision:Achoicemadefromavailablealternatives.,Decisionmaking:,15,TypesofDecisionMaking,16,TypesofDecisionMaking,Non-ProgrammedDecisionMaking,ProgrammedDecisionMaking,Routine,almostautomaticprocess,Therearerulesandguidelinestofollow,Unusualsituationsthathavenotbeenoftenaddressed.,Norulestofollowsincethedecisionisnew,17,ExamplesofManagerialDecision-MakingSituation,Fast-foodrestaurant,TypeofOrganization,ProgrammedDecision,Non-programmedDecision,University,Auto-maker,Determinesupplierstobereordered,Identifylocationfornewfranchise,Decideifstudentsmeetgraduationrequirements,Choosenewacademicprograms,Determineunionemployeepayrates,Selectnewcardesign,18,ManagementLevel,DecisionType,First-line,Middle,Top,Non-programmedDecision,ProgrammedDecision,Thehighmanagementlevelamanageron,themorenon-programmeddecisionheshouldmake,19,DecisionMakingModel,TheClassicalModel,Listalternatives&consequences,Rankeachalternativefromlowtohigh,Selectbestalternative,AssumesallinformationisavailabletomanagerAssumesmanagercanprocessinformationAssumesmanagerknowsthebestfuturecourseoftheorganization,Assumption,110,DecisionMakingModel,TheAdministrativeModel,DevelopedbyJamesMarchandHerbertSimon,Cognitivelimitationsconstraindecisionmakingability,RiskandUncertaintyAmbiguityTimeandcostconstraints,Acceptableandsatisfactorydecisionratherthanoptimumone,LearningObjectives,112,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Frametheproblem,Generate&assessalternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,113,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Managersmustfirstrealizethatadecisionmustbemade,114,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Managersmustdevelopfeasiblealternativecoursesofaction,115,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Whataretheadvantagesanddisadvantagesofeachalternative,116,StepsintheDecisionMakingProcess,116,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Managersrankalternativesanddecide.,117,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Managersmustnowcarryoutthealternative,118,StepsintheDecisionMakingProcess,Recognizeneedforadecision,Generatealternatives,Evaluatealternatives,Chooseamongalternatives,Implementchosenalternative,Learnfromfeedback,Managersshouldconsiderwhatwentrightandwrongwiththedecisionandlearnforthefuture,LearningObjectives,120,Cognitivebiasesareinevitableindecisionmakingprocess,DanielKahneman,AmosTversky,121,PriorHypothesis,Representativeness,IllusionofControl,EscalatingCommitment,CognitiveBiases,TypicalCognitiveBiasesSource,122,PriorHypothesis,Representativeness,IllusionofControl,EscalatingCommitment,CognitiveBiases,TypicalCognitiveBiasesSource,Makedecisionbasedonpriorbelief,123,PriorHypothesis,Representativeness,IllusionofControl,EscalatingCommitment,CognitiveBiases,TypicalCognitiveBiasesSource,Makedecisionbasedonsmallsampleorsinglecase,124,PriorHypothesis,Representativeness,IllusionofControl,EscalatingCommitment,CognitiveBiases,TypicalCognitiveBiasesSource,Makedecisionbasedonoverestimateability,125,PriorHypothesis,Representativeness,IllusionofControl,EscalatingCommitment,CognitiveBiases,TypicalCognitiveBiasesSource,Ignoreadverseevidenceandincreaseinvestment,LearningObjectives,127,GroupDecision,128,GroupDecisionMakingMethods,ConfirmQuestion,Expertsanswerquestionnairesindependently,Collectandanalyzequestionnaires,Feedbackandanotherroundagain,Obtainconsensustosolvequestion,DelphiTechnique,TheDelphiTechniquewasoriginallyconceivedasawaytoobtaintheopinionofexpertswithoutnecessarilybringingthemtogetherfacetoface.,MajorSteps:,129,GroupDecisionMakingMethods,NominalGroupTechnique,Adecisionmakingmethodforuseamonggroupsofmanysizes,whowanttomaketheirdecisionquickly,asbyavote,butwanteveryonesopinionstakeninto.,MajorSteps:,130,GroupDecisionMakingMethods,Brainstorming,DevelopedbyAlexF.Osbornin1953Agroupcreativitytechniquedesignedtogeneratealargenumberofideasforthesolutionofaproblem,Focusonquantity,Withholdcriticism,Welcomeunusualideas,Combineandimproveideas,BasicRules,131,GroupDecisionMakingMethods,132,K,A,TypesofDecisions,C,Understand,Administ