Week 6 Leadership _ Decision-making

Week 6 Leadership _ Decision-making - Alex Fettis, Chelsi...

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Alex Fettis, Chelsi Denback, Betsy Callan, Erica Lemanski, Laura Zander, and Kate  Pawlukiewicz Chapter 8 –Decision Making and Creativity Rational Choice Paradigm of Decision Making Rational Decision Making Process #1 Identify problem or opportunity #2 Choose best decision process #3 Develop alternative solutions #4 Choose best alternative #5 Implement selected alternative #6 Elevate decision outcomes *Assumes that people naturally select the alternative with the highest subjective expected utility Problems with Problem Identification - Stakeholder Framing: increased vested interests, decreased full assessment danger signs - Perceptual Defense : blocking out bad news - Mental Models: road maps that provide stability and predictability to guide a person’s preferences and behaviors - Decisive Leadership: leaders more effective when they are decisive decision makers - Solution-Focused Problems: provides comforting closure problems Bounded Reality: Processing limited and imperfect information and satisficing rather than maximizing when choosing among alternatives Problems with Goals Clear goals are needed, but in reality goals are ambiguous Problems with Information Processing Implicit Favorite: The decision maker’s preferred alternative against which all other choices are judged Problems with Maximization Satisficing: selecting a solution that is satisfactory, or “good enough” rather than optimal or “the best” Evaluating Opportunities When opportunity is found one does not look for alternatives Emotions and Making Choices Emotions affect evaluation of alternative in three ways: 1. Emotional marker process determines our preference about each alternative 2. Moods/specific emotions influence process of evaluating alternatives 3. “Emotions as information” – emotions provide guidance in decision making Intuition and Making Choices Intuition: the ability to know when a problem or opportunity exists and select the best course of action without conscious reasoning
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Alex Fettis, Chelsi Denback, Betsy Callan, Erica Lemanski, Laura Zander, and Kate  Pawlukiewicz Making Choices More Effectively Scenario Planning: a systematic process of thinking about alternative futures, and what the organization should do to anticipate and react to those environments Evaluating Decision Outcomes Postdecisional Justification: justifying choices by unconsciously inflating the quality of the selected option and deflating the quality of the discarded options Escalation of Commitment Escalation of Commitment: the tendency to repeat an apparently bad decision or allocate more resources to a failing course of action Causes of Escalating Commitment - Self-justification - Prospect theory effect - Perceptual blinders - Closing costs
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This note was uploaded on 04/02/2008 for the course PSYCH 260 taught by Professor Akutsu during the Spring '08 term at University of Michigan.

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Week 6 Leadership _ Decision-making - Alex Fettis, Chelsi...

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