Chapter 5

Define the problem

-Problem exists when there is a gap between a desired state (want is wanted) and existing state (the situation you are actually facing)

Generate alternative courses of action

-the idea is to generate as much alternatives as possible

Limites to Rational Decision making

-Bounded rationality: as decision making process restricted in the real world by: Limited sources, incomplete and imperfect information and mangers limited decision-making capabilities

Steps to establish nominal group techniques

1. During "quiet time", group members write down as many problems and solutions as possible 2. each member shares one idea at a time 3. ideas are posted on flip charts until all ideas are shared 4. Group discusses advantages/disadvantages 5. ideas are ranked during second "quiet time" 6. members read ranking aloud, and the idea with the highest average rank is selected

Devil's Advocacy

-Devils advocacy creates c-type conflict by assigning an individual or a subgroup the role of critics -steps to establish a Devil's Advocacy Program

Compute the optimal Decision

-multiply the rating for each criterion by the weight for that criterion -sum the scores for alternatives course of action -computing the optimal decision is done by multiplying the rating for each criterion (Step 5) by the weight for that criterion (Step 3), and then summing those scores for each alternative course of action (Step 4). those weights are then multiplied by the rating in each category

Evaluate each alternative

-systematically evaluate each alternative against each criterion -This step can take much longer and be more expensive than other step in the process

Delphi Technique

-which members of panel of experts respond to questions and to each other until reaching agreements on an issue

Steps Delphi Technique

1. Assemble a panel of experts 2. create a questionnaire of open-ended questions 3. summarize the response and feed back to the panel until the members each agreement 4. create a brief report and send to the panel members for agreement/disagreement 5. continue the feedback process until panel reaches agreement

Steps to Rational Decision Making

1. Define the problem 2. identify decision criteria 3. Weight the criteria 4. Generate alternative course of action 5. Evaluate each alternative 6. compute the optimal decisions

Steps to establish a dialectical inquiry process

1. Generate a potential solution 2. Identify the assumptions underlying the potential solution 3. Generste a conflicting counterproposal based on opposite assumptions 4. Have advocates of each position present their arguments and engage in a debate in front of decision makers 5. Decide whether to use, change, or not use the original proposed solution

Multivariable Testing

-as systematic approach of experimentation to analyze and evaluate potential solutions -Improves decision making by: 1. conducting experiment and letting the data decide 2. saving time and money by using a mathematical shortcut to test variables

Nominal Group Technique

-begins and ends by having group members quietly write down and evaluate ideas to be shared with the group -improves group decisions making by decreasing a-type conflict -also restricts c-type conflict -typically produces poorer-quality decisions than Devil's advocacy or dialect inquiry approaches -produce better qualities than traditional group decisions

Dialectical Inquiry

-creates c-type conflict by forcing decision makers to state the assumptions of a proposed solution (a thesis) and to then generate a solution that is the opposite (antithesis) of the proposed solution

weight the criteria

-deciding which criteria are more or less important -decision maker need to provide an initial 1. Absolute comparisons -each criterion is compared to a standard or ranked on its own merits -ignores other criteria 2. relative comparisons -each criterion is compared directly to every other criteria

Identify decision criteria

-decision criteria are standards used to guide judgements and decisions -the more criteria a potential solutions meets, the better that solution should be

Steps to establish a Devil's advocacy Program

1. Generate a potential solution 2. assign a devil's advocate to criticize and question 3. present the critique of the solution to key decision makers 4. Gather additional information 5. Decide whether to use, change, or not use the originally proposed solution

to make decisions about problems, managers must:

1. be aware of the gap -need to know there is a problem before they can solve it 2. be motivated to reduce the gap b/w desired state and existing state 3. have the knowledge, skills, abilities and resources to fix the problem