MGMT 3300 Chapter 7

________ is the process of studying large amounts of data of a variety of types to uncover hidden patterns, unknown correlations, and other useful information.

Big Data analytics

Climax Medical Technology, a fast-growing global research firm, has accumulated so much client information that conventional database management systems cannot handle its customers' needs. Therefore, Climax purchased very sophisticated analysis software and supercomputing-level hardware. Climax Medical Technology is tapping the power of

Big Data.

Which of the following is NOT a guideline that can lead to effective brainstorming?

Eliminate ideas that will be too costly.

Max is in the marketing department with Loose Leaf Teas. He was given the responsibility of determining if customers liked the new calming chamomile. According to Loose Leaf's sales data, over 4,000 customers purchased the new tea last month. If Max surveys 25 of those customers to determine if they like the tea or not to base his marketing campaign on, he will most likely suffer from confirmation bias.

False

In regard to decision making, which of the following statements reflects what research has found?

Groups make better decisions than most individuals acting alone.

Tyree is starting a new project and wants an advisory board, as this project will affect many people and hearing the opinions of others will be beneficial. As he sits down to consider who should be on the board, he lists many organizations, both civic and private. He wants to be sure to include the institutions of higher education, so that they can be informed of the type of employees he will need in the future. Tyree wants to be careful to not forget private citizens, so that this project will not end up causing a political debate and being shut down before it even starts. When he looks at his list, he has over 40 people on it. He decides that is a good enough number and he is ready to start sending out the invitations to the first meeting. Tyree's partner advises him with which of these following statements?

In general, the larger the group, the lower the quality of their decisions.

In the third step of rational decision making (evaluating alternatives and selecting a solution), a manager needs to evaluate each alternative not only according to cost and quality but also according to which of the following questions?

Is it ethical, feasible, and effective?

Little Rascals Child Care Center has decided to change its hours from 6am to 6pm to 7am to 5pm beginning at the start of the next month. The owner, Wanda, feels that the change is needed because only a few families were coming in before 7am, and, therefore, it was not cost-effective to be open that early. In making her decision, was Wanda being sensitive to the families who brought their children to the center?

No, she did not consider how the people affected may feel about the change.

How does the text suggest prioritizing your decisions?

Organize your decisions into three categories.

What is a sign that a group is suffering from groupthink?

Peer pressure makes members agree with the ideas of the other people in the group.

_________ is a data-mining technique used to predict future behavior and anticipate the consequences of change.

Predictive modeling

Which of the following reasons makes it hard to be evidence-based?

The evidence doesn't quite apply.

Decision making is the process of identifying and choosing alternative courses of action.

True

The dialectic method calls for managers to foster a structured dialogue or debate of opposing viewpoints prior to making a decision.

True

With satisficing, managers look for alternatives until they find one that is satisfactory, not optimal.

True

Otis, the manager of a camera store, believes that his store may be closed by corporate in the near future, so he cannot sleep well at night and he is dealing with severe anxiety and irritability, and he has been ill several times this month. Several times Otis has missed important details in his job, and he almost got in an automobile accident this morning. The district manager is coming today to do his bimonthly evaluation of Otis's store. Although Otis usually performs well, he is worried about this one. His district manager may be influenced by ________ bias.

availability

The rational model of decision making is also called the ____ model.

classical

Nora is a small-business owner who loves to take risks. She also enjoys going out and meeting customers and potential clients—the social aspect of her job. Nora relies on intuition and discussions with others to acquire information. As an interior decorator, Nora utilizes her imaginative strengths, taking a broad perspective to problem solving, and she likes to consider many options and future possibilities. Nora's decision-making style is best described as

conceptual

When people seek information to support their point of view and discount data that do not, they are subject to ______ bias. For example, Rick uses the fact that his commute is now shorter to confirm his belief that there are fewer cars on the road. However, Rick is not accounting for the fact that he recently took over the graveyard shift, and that traffic is always lighter at night and in the wee hours of the morning.

confirmation

A person's ________ reflects the combination of how he or she perceives and responds to information.

decision-making style

When Sebastian wrote the contract with BP for over two billion dollars, he included targets for performance that had to be met before a payment would be released. Sebastian was trying to avoid ________bias.

escalation of commitment

Republican advertisements about Representative Adam Johnson, the Democratic candidate, portray him as lazy, dishonest, and poor at his job. At the same time, the Democratic ads for Adam Johnson describe him as a caring, honest, hard worker. The sponsors of these advertisements know that ads can affect whom voters choose on Election Day. The tendency of decision makers (the voters in this example) to be influenced by how a situation or problem is presented to them is an example of

framing bias.

The advantages of _______ are having a greater pool of knowledge, gaining different perspectives, gaining intellectual stimulation, having a better understanding of decision rationale, and having a deeper commitment to the decision.

group decision-making

With regard to decision making, it is accurate to say that groups

have higher decision-making accuracy when group members know a good deal about the relevant issues.

Ashante was telling a friend about her new job. She commented, "We work in groups all the time and everyone is able to share ideas. I am so new I just listen, but if I wanted to, I know they would listen to me too. Ashante is suffering from

illusion of unanimity and peer pressure.

Simon has been in the landscaping business for over 40 years. When Jorge, his business partner, suggested adding snow removal as an extra service, Simon responded with "My gut feeling is to say yes because of my experience in the past and what I have seen other companies do over the years, both successfully and not." Simon is acting on ________ in his response to Jorge.

intuition

Katia, the computer department manager at Tech Enterprises, is considering whether to use a group to develop a plan to help employees sell extended warranties on technology sales. Katia should consider having the group make this decision if

it will increase acceptance of the plan.

When Ford was slow to recall vehicles to fix a possible carbon monoxide leak, it was most likely due to ________, because Ford was convinced that the modifications made by police departments were the cause of the problem, not the manufacturing of the vehicle.

overconfidence bias

Macon, feels that he constantly confronted with problems. He tries very hard to create alternative solutions and then evaluate them. He often implements the selected solution, but then another problem arises. He begins to express his frustrations by accusing employees of not fully executing the solution as described in his plan. What style of decision making does Macon use?

rational

Scott and his partner, Greg, have decided to update their computer network, although they have no expertise in this area. During a meeting with Greg, Scott commented that "Our decision is limited by numerous constraints, such as our understanding of the complexity of technology, time and money, imperfect information, and our conflicting goals." These limitations are hindrances to

rational decision making.

Wes, the store manager, recently had to fire Andrea, an employee who graduated from Southern College. He felt that Andrea was not well trained at her school. So, when Zeke, also a graduate from Southern College, applied for Andrea's old position, he did not want to consider hiring him, feeling Zeke also probably did not receive the proper training. Wes was affected by _____ bias.

representativeness

Gloria, the controller of Luna Pizza, is purchasing several new delivery vehicles. Gloria has numerous work responsibilities, so she has limited time to shop for cars. Because of the time constraints, she cannot make an extensive search for the best alternative, so she looks for cars until she finds a model that is satisfactory. Gloria is following the ________ model.

satisficing

Which of the following is NOT an advantage of group decision making?

satisficing

If a decision doesn't turn out as well as you'd hoped,

start by forgiving yourself.

Goal displacement, satisficing, and groupthink are

the disadvantages of group decision making.