Week 5: Decision Making Flashcards
(20 cards)
What is decision making? What are the two types of decisions?
-Decision making is the process of developing a commitment to some course of action.
-There are two types of decisions: well structured, and ill structured
What is a well-structured decision?
-With a well-structured decision, the existing state is clear, the desired state is clear, and it’s clear how to get from one state to the other.
-The problems are simple, and their solutions create little controversy.
-These problems are repetitive and familiar.
-To handle a well-structured decision, employes often establish a “program”, which is a standardized framework of solving a problem.
What is an ill-structured decision?
-An ill-structured decision is one in which the existing and desired states are unclear and the method of getting to the desired state is unknown.
-With an ill-structured decision, we may be able to identify the problem, but the path forward is hazy.
-Ill-structured problems are unique, unusual and have not been encountered before.
-They are also often complex and involve a high level of uncertainty.
-Ill-structured decisions often arouse a lot of controversy and conflict amongst those about whom the decision is made.
What is perfect rationality?
Perfect rationality is a decision strategy that is completely informed, perfectly logical, and oriented towards economic gain.
What is bounded rationality?
Bounded rationality is a decision strategy that relies on limited information and that reflects time constraints and political considerations.
What is the rational decision making model?
1) Identify problem
2) Search for Relevant Information
3) Develop Alternative Solutions
4) Evaluate Alternative Solutions
5) Select Best Solution
6) Implement Chosen Solution
7) Monitor and Evaluate Chosen Solution
-That leads us back to evaluate problem.
What are some challenges that may occur in the problem identification stage?
-Problem identification can often fail due to employees having a lack of knowledge or experience
-Denial of the issue due to fear, ego, or organizational politics could also create issues
-Defining a problem based on a solution without truly understanding the problem could make the problem hard to solve.
What are some problems that could occur as we search for relevant information?
1) Not enough information:
-When information is lacking individuals may rely on cognitive shortcuts using heuristics(mental rules of thumb), or ignoring base rates(statistical averages).
2) Information Overload: Experts can quickly distinguish signal from noise due to pattern recognition and domain knowledge.
What is framing?
-Whether an outcome is framed positively or negatively drastically impacts people’s decisions.
-People avoid risk when an outcome is framed positively. People are afraid to give up that positive outcome.
-People seek risk when an outcome is framed negatively. They believe if they play it safe, they are guaranteed to lose, but if they take a risk they may be neutral, or they may lose(they fail to account for the fact that they lose even bigger here).
How does inexperience affect decision making?
-The lack of domain knowledge leads to difficulty in interpreting information and recognizing patterns.
-For instance, a new manager may misinterpret poor team performance as laziness, failing to recognize that the true reason was unclear expectations.
-Inexperienced decision-makers often rely on guesswork or others’ opinions, which can result in errors or overreliance on authority figures.
What is hindsight bias?
-Hindsight bias is the tendency to believe after an event has occured that we “knew it all along.”
-For instance, after a product fails, people may say that it’s obviously flawed even though they supported it before.
How does mood or emotion shift decision making?
-A person’s emotional state can distort their ability to evaluate options fairly.
-Mood is especially relevant in ambigious decisions.
-A person could be too quick to say yes in a good mood, and too quick to say no in a bad mood.
-A small dose of emotion can help decision making?
What are the benefits of group decision making?
1) Pooling of Resources: Groups combine different skills, knowledge, and perspectives, leading to better decision making.
2) Specialization of Labour: Members can focus on the parts of the decision where they have the most expertise.
3) Decision Acceptance: Group members are more likely to support and implement a decision they helped to make.
4) Creativity: Group interaction often sparks new ideas and innovative solutions.
What are the disadvantages of group decision making?
1) Wasted Time: Decision-making can be slowed down due to scheduling, discussion, and consensus building
2) Group Conflict: Differences in opinion, goals, or communication styles can lead to friction.
3) Intimidation by Group Leaders: Dominant personalities may silence others or steer the decision in a biased direction.
4) Groupthink: The desire for harmony leads to suppressed dissent and flawed decisions.
What are the various symptoms of groupthink?
1) Mindguards: Members shield the group from dissenting opinions
2) Invulnerability: Group feels overly confident due to consensus and ignores risks
3) Superior Morality: Belief that the group’s ethics are above criticism
4) Rationalization: Discount warnings or negative feedback
5) Stereotyping: Dismissing outsiders as wrong or inferior
6) Self-Censorship: Individuals withhold doubts or objections
7) Unanimity: Illusion that everyone agrees
8) Conformity Pressure: Pressuring members to agree and conform
How can groupthink be prevented?
1) Remove pressure towards coming to a specific decision outcome
2) Establish norms that reinforce constructive dissent and/or appoint a devil’s advocate
3) Develop and follow a rational decision making strategy
4) Bring in experts to challenge group opinions
How does face to face brainstorming compare to electronic brainstorming?
-It is far easier to generate a wide range of ideas with electronic brainstorming.
-However, with face-to-face brainstorming employees are more likely to buy in to the final decision.
What is satisficing?
Satisficing is a decision-mkaing strategy that involves choosing the first acceptable solution rather than the optimal one.
What is nominal group technique?
-Nominal group technique is a structured face-to-face group discussion method that combines individual idea generation with group evaluation.
-The steps are as follows:
1) Individuals silently write down ideas
2) Each person presents one idea, and they keep going until all the ideas are out there
3) Group discusses ideas for clarification (not criticism)
4) Members individually rank or vote on ideas
5) Highest-ranked ideas are selected
-Nominal group technique should be used when you want quick, inclusive input, when face-to face interaction is possible, and when you need to avoid dominance by vocal members.
-Nominal group technique helps to reduce conformity pressure, encourage equal participation, and have efficient idea generation and prioritization.
-It can be time consuming and sensitive.
What is Delphi technique?
-The delphi technique is a remote, iterative method of gathering input from a panel of experts through multiple rounds of anonymous surveys or questionaires.
-The steps are as follows:
1) Experts answer initial questions individually (often online)
2) Responses are summarized and shared anonymously
3) Experts revise their answers in light of group feedback
4) Process repeats until a consensus or stable pattern emerges.
-We use this when you are working with geographically dispersed experts, the topic is complex or controversial, and anonymity is needed to avoid bias or group pressure.
-This helps to avoid groupthink and dominance, and can be ideal for sensitive topics.
-It can be time consuming and sensitive.
