Chapter 7 MGMT 301

relaxed avoidance

taking no action in the belief that there will be no great negative consequences

Conceptual decision making

tend to focus on people or social aspects of a work situation. they take a broad perspective to problem solving and like to consider many options and future possibilities.

curse of knowledge

When better-informed people find it extremely difficult to think about problems from the perspective of lesser-informed people.

Which of the following is not true about group decision making

An added benefit of group decision making is groupthink.

decision tree

a graph of decisions and their possible consequences; it is used to create a plan to reach a goal

System 1 vs. System 2

System 1: (intuitive and largely unconscious) automatic evaluation based on pre-set assumptions System 2: (analytical and conscious) Slower, more effortful, deliberate processing

when a group can help in decision making

(1) When it can increase quality; (2) When it can increase acceptance; (3) When it can increase development.

Some Uses of Big Data

Analyzing consumer behavior and spurring sales Improving hiring and personnel management Tracking movie, music, TV, and reading data Exploiting farm data Advancing health and medicine Aiding public policy

bounded rationality

Cognitive limitations that constrain one's ability to interpret, process, and act on information.

Whats wrong with the rational model

Complete information, no uncertainty Logical, unemotional analysis Best decision for the organization -all assumptions are unrealistic

Directive Style of Decision Making

action-oriented decision makers who focus on facts. low tolerance for ambiguity. task and technical concerns. systematic approach.

Which of the following is not true about group decision making? a. Groups take longer to make decisions b. The larger the group, the lower the quality of the decision c. An added benefit of group decision making is groupthink d. Groups are more confident about their choices than individuals are e. People who aren't familiar with one another tend to make better decisions when the members have common knowledge

c. An added benefit of group decision making is groupthink NOT SURE ABOUT ANSWER

In defensive avoidance, when managers can't find a good solution, their usual response is a. doing nothing b. taking the easiest way out c. procrastination, passing the buck, or denying the risk of any negative consequences d. finding the most cost-effective solution e. frantically getting rid of the problem

c. procrastination, passing the buck, or denying the risk of any negative consequences

defensive avoidance

can't find a good solution and follows by (a) procrastinating, (b) passing the buck, or (c) denying the risk

decision

choice made from among available alternatives

Pat, the human resources manager, has significant experience handling ethical issues in the workplace. Over the years he has received extensive training in matters of workplace ethics. Due to Pat's legal background (he is a member of the local bar association), the management of his company rely on Pat to assist them with legal issues, especially with ethical dilemmas. The ideal role for Pat within the organization is a. oversight specialist b. whistle-blower c. ombudsman officer d. ethics officer e. proprietary officer

d. ethics officer

When a manager is so frantic to get rid of the problem that he or she can't deal with the situation realistically, the manager is experiencing a. avoidance management b. defensive avoidance c. a fog reaction d. panic e. life avoidance

d. panic

Salvador, who works as a waiter in a top restaurant in Manhattan, likes the fast pace of his work and the face that things are always changing there. Salvador can be said to a. have a large need for structure b. have a low tolerance for ambiguity c. have a high task orientation d. rank high on the stress index e. have a high tolerance for ambiguity

e. have a high tolerance for ambiguity

Analytical Decision Making

high tolerance for ambiguity; task and technical concerns.respond well to uncertain situations.

dialetic method

identify a truth, a thesis, structure dialogue

managing career readiness

improve your critical thinking and problem solving skills

Big data

includes not only data in corporate databases but also web-browsing data trails, social network communications, sensor data, and surveillance data

Intuition Model (Decision Making)

represents a judgement that is based on a subconscious integration of information stored in the memory

systems of groupthink

sense of invulnerability rationalization illusion of peer pressure the wisdom of crowds

panic

so frantic to get rid of the problem that one can't deal with the situation realistically

ethics officer

someone trained about matters of ethics in the workplace, particularly about resolving ethical dilemmas

Business Analytics (BA)

sophisticated forms of business data analysis

framing bias

the tendency of decision makers to be influenced by the way a situation or problem is presented to them

rational decision making model

A step-by-step approach to making decisions that is designed to maximize outcomes by examining all available alternatives

3 effective reactions: deciding to decide

1. Importance "how high priority is this situation" 2. Credibility "how believable is the info about the situation" 3. Urgency " how quickly must I act on the info about the situation"

Bagley's ethical decision tree

1. Is the proposed action legal? 2. Does is maximize shareholder wealth? 3.1 Is it ethical? 3.2 Would it be ethical to take action?

Rules for Brainstorming

1. No criticism allowed 2. Work for Quantity 3. Welcome piling-on 4. Allow free-for-all

What makes it hard to be evidence based?

1. There's too much evidence 2. There's not enough good evidence 3. The evidence doesn't quite apply 4. People are trying to mislead you 5. You are trying to mislead you 6. The side effects outweigh the cure 7. Stories are more persuasive anyway

Seven Implementation Principles of Evidence-Based Management

1. Treat your organization as an unfinished prototype. 2. Don't brag, just use facts. 3. See yourself and your organization as outsiders do. 4. Evidence-based management is not just for senior executives. 5. Like everything else, you still need to sell it. 6. If all else fails, slow the spread of bad practice. 7. The best diagnostic question: What happens when people fail?

rational decision making

1. identify the problem or opportunity 2. think up alternative solutions 3. evaluate alternatives and select a solution 4. implement and evaluate the solution chosen

Prioritize your decisions

1. list the decisions you need to make over the relevant time period 2. characterize each decision according to complexity and magnitude 3. organize decisions into 3 categories: strategic decisions, significant decisions, quick decisions. 4. note timing for each decision

successful implementation

1. plan carefully 2. be sensitive to those affected

Disadvantages of group decision making

A few people dominate or intimidate Groupthink Satisficing Goal displacement

satisficing model

Because of constraints, managers don't make an exhaustive search for the best alternative. Instead, managers seek alternatives until they find one that is satisfactory, not optimal.

Group Problem Solving Techniques

Consensus Brainstorming

devil's advocate

To present a counter argument

evidence based decision making

Translation of principles based on best evidence into organizational practice, bringing rationality to the decision-making process

Big Data

a broad term for datasets so large or complex that traditional data processing applications are inadequate.

predictive modeling

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

artificial intelligence

Type of software that can process information on its own without human intervention.

confirmation bias

a tendency to search for information that supports our preconceptions and to ignore or distort contradictory evidence

Dennis, the owner of a popular restaurant, is a religious man, and he needs to make a decision on whether he will add beer and wine to his menu, based on the recommendations of his chefs and others. When confronted with a choice when making a decision, he tends to make his decisions based on his beliefs, even if evidence shows those beliefs are wrong. If his religious beliefs favor not serving alcohol in his café, according to the prior-hypothesis bias he would choose not to dd beer and wine to his menu. a. True b. False

a. True

During a management workshop, Tony, the HR manager, spoke about making decisions related to firing an employee. He said, "I have several rules of thumb that I use to make a decision. First, I ask if it's legal and then if it's ethical." He then laid out several other steps he uses in the decision-making process related to firing. Tony's "rules of thumb" are also known as heuristics. a. True b. False

a. True

In deciding to decide, a manager agrees that he or she must decide what to do about a problem or opportunity and take effective decision-making steps. a. True b. False

a. True

Research shows that most managers have characteristics that fall into two or three decision-making styles, and that decision-making styles vary across occupations, job level, and countries. a. True b. False

a. True

Technology Specialists is an organization specializing in highly specialized technology software, but it found that its original business idea is not working. Rather than failing as a company, it chose a new direction and rewrote its business plan. Technology Specialists is an example of how managers need to think and act as if their organization is an unfinished, changeable prototype that won't be ruined by dangerous new ideas. a. True b. False

a. True

Anthony, the plant manager, was talking with another manager about Tim, the lead engineer in the corporate R & D department. Anthony remarked, "Tim is so bright, and he is an expert in designing products. But like so many experts, he can't imagine what it's like to be as ignorant as the rest of us. I think at times, he cannot see things from an outsider's perspective." Tim is suffering from a. the curse of knowledge b. the tunnel vision effect c. an analytics perspective d. a narrow perspective e. the intellectual fog effect

a. the curse of knowledge

diagnosis

analyzing the underlying causes

Nonrational Decision Making

assume that decision making is nearly always uncertain and risky, making it difficult for managers to make optimal decisions

Stores of data that are so vast that conventional database management systems cannot handle them, and very sophisticated analysis software and supercomputing-level hardware are required, are known as ________. These data include not only data in corporate databases but also web-browsing data trails, social network communications, sensor data, and surveillance data. a. cyber-age databases b. Big Data c. mega IT d. super data e. new age computing

b. Big Data

A logic manager is someone trained about matters of ethics in the workplace. a. True b. False

b. False

Being aware of your decision-making style does not really help you determine your strengths and weaknesses as a decision maker, but it can help you understand when a decision needs to be made. a. True b. False

b. False

Evidence-based management is the use of databases and facts regarding employees to assist in decision making. a. True b. False

b. False

Evidence-based management is the use of facts regarding an employee, for example when theft is suspected, and using a database to assist in decision making regarding future action. a. True b. False

b. False

The local university is now facing some tough decisions, so they are using the decision tree, which contains individuals, websites, and organizations that specialize in handling sensitive and difficult decisions. a. True b. False

b. False

group advantages

better decisions, pooled resources, motivation, accomplishment

problems with rational decision making

complexity different cognitive capacity time and money imperfect info info overload different priorities conflicting goals

To help with hiring decisions during peak seasons and holidays, Touching Cards uses time-series forecasts, like sales from last Valentine's Day and Christmas, to predict future sales based on patterns of historical data. Touching Cards is making use of a. a seasonal trend b. a trend decision c. diagnosis d. analytics e. a logical system

d. analytics

escalation of commitment bias

decision makers increase their commitment to a project despite negative information about it

a persons _____ reflects the combination of how he or she perceives and responds to info

decision-making style

General Decision Making Styles

directive, analytical, conceptual, behavioral

________ is the process of analyzing the underlying causes. a. Digging b. Analytics c. Undermining d. Management through analysis e. Diagnosis

e. Diagnosis

A ________ is a graph of decisions and their possible consequences. a. decision structure b. corporate hierarchy c. resolution graph d. decision-result assessment e. decision tree

e. decision tree

relaxed change

realizing complete inaction will have negative consequences but opts for the first available alternative

representative bias

refers to the tendency to generalize from a small sample or single event

Ethics

standards of right and wrong that influence behavior

behavioral decision making

supportive, receptive to suggestions, show warmth prefer verbal to written information. tend to avoid conflict

big data analytics

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

hindsight bias

the tendency to believe, after learning an outcome, that one would have foreseen it

Adjustment Bias

the tendency to make decisions based on an initial figure

characteristic of group decision making

they are less efficient the size affects decision quality

tips for improving intuition

trust you own intuitive judgment try visualizing solutions seek feedback challenge your intuition test you intuitive success rate

sunk cost bias

when managers add up all the money already spent on a project and conclude it is too costly to simply abandon it

availability bias

when managers only use info that is readily available from memory to make judgement