6 - PART THREE C H A P T E R S I X Decision Making: The...

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PART THREE C H A P T E R S I X Decision Making:  The Essence of the  Manager’s Job 6 Chapter Outline Introduction  The Decision-Making Process Step 1: Identifying a Problem Step 2: Identifying Decision Criteria Step 3: Allocating Weights to the Criteria Step 4: Developing Alternatives Step 5: Analyzing Alternatives Step 6: Selecting an Alternative Step 7: Implementing the Alternative Step 8: Evaluating Decision Effectiveness The Manager as Decision Maker  Making Decisions: Rationality, Bounded  Rationality, and Intuition Assumptions of Rationality Bounded Rationality  Role of Intuition  Types of Problems and Decisions  Structured Problems and  Programmed Decisions Unstructured Problems and  Nonprogrammed Decisions Integration Decision-Making Conditions Certainty Risk Uncertainty Decision-Making Styles Decision-Making Biases and Errors Summing Up Managerial Decision-making Decision-making For Today’s World E veryone in an organization makes decisions, but decision-making is particularly important in a manager’s job. Decision-making is part of all four managerial functions. Managers are frequently called decision-makers when they plan, organize, lead and control. Decision-making is synonymous with managing. Decision-making can be routine or involve complex issues. In this chapter, we’ll look at the decision process and see that decision- making is essential to the manager’s job . Cecilia Mowatt is preparing for the challenges of managing the changes taking place within her organization. As her company continues its global expansion, decisions that were made concerning technology and globalization need to be monitored for effectiveness. How could she evaluate the effectiveness of the company’s decision to revamp its Web site for clients and member firms? What decision criteria might she use? 72
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Many PowerPoint Slides, including both original text art and newly created images, have been developed and are available for you to coordinate with Chapter 6 materials presentation. ANNOTATED OUTLINE 1. INTRODUCTION. Making good decisions is something that every manager strives to do because the overall quality of managerial decisions has a major influence on organizational success or failure. The concept of decision-making is explored in this chapter. 2. THE DECISION-MAKING PROCESS. A decision is a choice made from two or more alternatives. The decision- making process is a comprehensive process involving eight steps that begins with identifying a problem and decision criteria and allocating weights to those criteria; moves to developing, analyzing, and selecting an alternative that can resolve the problem; implements the alternative; and concludes with evaluating the decision’s effectiveness. (See Exhibit 6.1 for a depiction of the decision- making process.) A. Step 1 is identifying a problem. A problem is defined as a discrepancy between an existing and a desired state of affairs. Some cautions about
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This note was uploaded on 10/21/2009 for the course FSD 6789 taught by Professor Vinh during the Spring '09 term at ITT Tech Flint.

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6 - PART THREE C H A P T E R S I X Decision Making: The...

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