Decision Making Model
Identify problem, Identify Decision Criteria, Allocate Weights, Develop Alternatives, Analyze Alternatives, Select –Implement
Problem clarity, known options, clear/constant preferences, no time/cost constraints, max.payoff, sufficient creativity.
decisions are limited by ability to process info. Decisions are satisfactory.
decisions made on gut feelings, (experience, emotions, skills/knowledge, subconscious, values) 1/3
of managers use this.
clear goals, familiar, easily defined.
repetitive/routine approach, low level man. (Policy
-general guideline to make
a decision, Procedure
-series of steps used to respond, applying policy, Rule
-explicit statement limits dos/donts).
new/unusual, info is incomplete/ambiguous,
require custom decisions.
top level man. unique/nonrecurring, custom made response.
ideal situation, man. Can make accurate decisions, outcomes
common situation, man. Estimates probability of outcome.
limited info prevents estimations, forces intuition/gut feelings.
pessimist, maximize min. payoff.
(rational, orderly, consistent -- intuitive, creative, unique) Tolerance for Ambiguity
requires consistency/order –HI requires multiple thoughts)
Decision Styles Model:
= efficient/logical, low tolerance (fast, min. info, few alternatives, focus on short term)
hi tolerance/rational, careful decision maker, +info/alternates, able to adapt/cope, long term
hi tolerance/intuitive, +alternates, focus long term, creative.
low tolerance, intuitive, work well w/ others, try to avoid conflict.
5 Habits HROs-
not tricked by success, defer to experts, unexpected circumstance=solutions, embrace
complexity, anticipate (limits)
importance, logical/consistent, subjective/objective & analytical/intuitive thinking, clear/reliable/flexible, only info that’s needed,
encourages relevant info/informed opinion.
Primary mangr. Activity, define goals, establish strategy, develop plans to work:
Provides direction, reduces uncertainty, minimizes waste/redundancy,
increases efficiency, sets standards.
unwritten, short term focus, specific to a unit.
written, specific, long term, organizational goals.
Types of Plans:
strategic/operational. Time Frame:
long/short term. Specificity:
Formal plan= higher profits/return of assets,
positive financial results. Quality of Quantity! External environment can reduce impact of planning on performance, planning takes several years to affect performance.
Mission/Vision- who you are/want to be, Goals/Objectives- desired outcomes provide direction, Plans- Outline goals use of resources and activitites