Managerial Decision-making Flashcards
(18 cards)
Why is decision-making crucial for managerial success?
Making decisions, often under time pressure and without all the facts, is a crucial aspect of managerial success.
What are the characteristics of managerial decisions?
Managerial decisions are often characterized by risk, uncertainty, lack of structure, and conflict.
What are programmed decisions?
Programmed decisions are encountered and made before, having objectively ‘correct’ answers.
Examples include income formulas for university student aid, telephone scripts for employees, or the necessary GPA for good academic standing at a university.
What are nonprogrammed decisions?
Nonprogrammed decisions are new, novel, and complex decisions with no proven answers and a variety of possible solutions.
Examples include creating a design for a new Engineering building on campus or raising funds for new classroom technology.
What is certainty in decision-making?
Certainty occurs when decision makers have accurate and comprehensive information.
What is uncertainty in decision-making?
Uncertainty occurs when decision makers have insufficient information, which is usually the case.
What is risk in decision-making?
Risk occurs when the probability of success is less than 100 percent and losses may occur, including time, money, or reputation.
How can managers manage risk?
Managing risk involves accepting that decisions entail risk and doing everything possible to anticipate, minimize, and control it.
An example is Henry Ford doubling workers’ pay to address turnover.
What is conflict in decision-making?
Conflict involves opposing pressures from different sources, which can occur at the psychological level or between individuals or groups.
What are the phases of ideal decision making?
The phases include identifying and diagnosing the problem, generating alternative solutions, evaluating alternatives, making the choice, implementing the decision, and evaluating the decision.
What does it mean to satisfice in decision-making?
To satisfice means to choose an option that is acceptable but not necessarily the best or perfect.
What does it mean to maximize in decision-making?
To maximize means to aim for the best possible outcome with the greatest positive consequences and fewest negative consequences.
What does it mean to optimize in decision-making?
To optimize means to achieve the best possible balance among several goals.
What are some barriers to effective decision making?
Barriers include time pressures, social realities, and psychological biases.
What is confirmation bias?
Confirmation bias is the tendency to pay attention only to evidence that supports existing beliefs and ignore evidence that challenges them.
What is availability bias?
Availability bias is the tendency to overestimate the likelihood of events that are easily available in memory.
What is crisis management?
Crisis management is the process of identifying, preparing for, and dealing with potentially catastrophic events or damage.
What is an example of decision-making activity in rebranding?
Rebranding involves steps like identifying the problem, generating alternatives, evaluating them, making the choice, implementing, and evaluating.
An example is a fast-food business changing its logo and focus from local to regional/global.
