combined and in effect averaged to achieve a consensus of expert opinion

Combined and in effect averaged to achieve a

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combined and in effect averaged to achieve a consensus of expert opinion Computer aided decision making o Useful in collecting information more quickly but also in reducing roadblocks Chauffeur-driven systems o ask participants to answer predetermined questions on electronic keypads or dials Group-driven systems o Involves a meeting within a room of participants who expresses their ideas anonymously on a computer network for anonymous networking Barriers to effective decision making 1. Relaxed avoidance- “there is no point in doing anything: nothing bad is going to happen” o A manager decides to take no action in belief that there will be no repercussions o You either don’t see or you disregard the signs of danger 2. Relaxed change- “why not just take the easiest way out? o Manager realises that complete inaction will have negative consequences o Opts for first available alternative with low risk 3. Defensive avoidance- “there is no reason for me to explore other solution alternatives” o Manager can’t find a good solution and follows by procrastinating, denying risk of any negative consequences 4. Panic- “this is so stressful, I’ve got to do something to get rid of the problem!” o Especially apt to occur in crisis situations
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o Manager frantic to get rid of the problem that they can’t deal with the situation realistically o Managers have completely forgotten the idea of behaving with ‘grace under pressure’ of staying cool and calm Three Effective Reactions 1. Importance: how high priority is this situation o You need to determine how much priority to give the decision situation o If it is a threat, how extensive might prospective losses or damage be? o If it’s an opportunity, how beneficial might the possible gains be? 2. Credibility: how believable is the information about the situation o You need to evaluate how much is known about the possible threat or opportunity o Is the source of information trustworthy? Is there credible evidence? 3. Urgency: how quickly must I act on the information about the situation o Is the threat immediate? o Will the window of opportunity stay open long? o Can actions to address the situation be gone gradually? Decision Making Errors and Biases 1. Availability Bias: using only the information available o Managers use information readily available from memory to make judgements o May not present a complete picture of the situation 2. Representativeness Bias: faulty generalising from a small sample or a single event o Tendency to generalise from a small sample or single event o Just because something happens once, doesn’t mean it’s representative 3. Confirmation Bias: seeking information to support one’s point of view o When people seek information to support their point of view and discount data that doesn’t 4. Sunk-cost Bias: money already spent seems to justify continuing o When managers add up all the money already spent on a project and conclude it is too costly to simply abandon it 5.
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