Chapter 7 - Vocab 7.1 Decision- choice made from among...

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Vocab 7.1 Decision- choice made from among available alternatives Decision-making - process of identifying and choosing alternative courses of action Rational model of decision making- (classical method) explains how managers should make decisions; assumes managers will make logical decisions that will be the optimum in furthering the organizations best interests (1. Identify problem 2. Think up alternative solutions 3. Evaluate alternatives and select a solution 4. Evaluate new solution) Problems- difficulties that inhibit the achievement of goals Opportunities- situations that present possibilities for exceeding existing goals Diagnosis- analyzing the underlying causes Nonrational models of decision making - explains how managers make decisions; they assume that decision is nearly always uncertain and risky, making it difficult for managers to make optimal decisions (1. Satisficing 2. Incremental 3. Intuition) Bounded Rationality the ability of decision makers to be rational is limited by numbers constraints (complexity, time and money, capacity, values, skills, habits, and unconscious reflexes) Satisficing Model- managers seek alternatives until they find one that is satisfactory, not optimal Incremental Model- managers take small, short-term steps to alleviate a problem
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This note was uploaded on 12/20/2011 for the course MGT 3304 taught by Professor Cpneck during the Fall '07 term at Virginia Tech.

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Chapter 7 - Vocab 7.1 Decision- choice made from among...

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