Chapter 7: Decision Making and Creativity
Apex Manufacturing realizes it has made a mistake in hiring its new CEO but, according to the employment contract, the company paid him a sign-on bonus of several million dollars, so they decide to keep him on. Which of the causes of escalating commitment does this represent?
Sunk costs
When we are angry, we often rely on stereotypes to speed up the choice process. When we are optimistic, we pay less attention to details. These examples illustrate the role of _____ in the decision evaluation process.
moods
You're not looking for the sharpest needle in the haystack; you simply want one that is sharp enough to sew with. This is an example of ______.
satisficing
Mercy Hospital has developed a detailed set of plans to safeguard patients, staff, and hospital assets in the event of catastrophic situations, such as airplane crashes or terror attacks. This is an example of ______.
scenario planning
Terri has always been the star salesperson in the company and relishes her accomplishments. She has never missed her sales quotas, but this quarter's numbers are looking bad. However, she refuses to worry and tells her assistant, "I didn't get to be the Salesperson of the Year for nothing!" This is an example of the ______.
self-enhancement effect
Strategies to minimize escalation of commitment and confirmation bias include ______.
setting a level at which the decision will be abandoned if not successful ensuring that people who made the original decision are not the same as those who later evaluate it finding a source of systematic and clear feedback
One of the problems with problem identification is that organizational decisions and actions are influenced by what attracts a manager's attention, rather than what is truly important. This is known as _______.
stakeholder framing
The concept that people make decisions based on pure logic and all available information to choose the alternative with the highest value is referred to as ______.
the rational choice view
Intuition relies on programmed decision routines that speed up our responses to pattern matches or mismatches. What term is used to describe these programmed routines?
Action scripts
Which of the following is the lowest level of employee involvement?
Asking individual employees for specific information without describing of the problem the information is needed for
What are ways to improve the process of identifying problems and opportunities?
Becoming aware of problem identification biases Creating a mindset that actively searches for problems and opportunities Discussing perceptions of the situation with colleagues or coworkers
______ is the idea that, in decision making, people are limited by their ability to process information, their cognitive abilities, and the finite amount of time they have to make decisions.
Bounded rationality
Rank the following actions in terms of the level of employee involvement in decision-making, placing the greatest level of employment involvement at the top.
Hand/Des/Ask/Man
Which associative play activity involves listing different dimensions of a system and the elements of each and then looking at each combination?
Morphological analysis
Scott wanted to buy a pre-owned car. Before he started shopping, he formed an idea of what he thought the price should be for the model he wanted, given age, and mileage. This estimate is an example of the ______.
anchoring and adjustment heuristic
Which of the following represents the first step in the rational decision making process?
Identify the problem or opportunity
The "inner feeling" or "gut instinct" we have when making a decision is known as
Intuition
Which of the following statements about satisficing is true?
It is the act of choosing an alternative that is "good enough."
Which of the following are benefits of employee involvement in the decision-making process?
It may improve the evaluation of alternatives. It increases the number and quality of solutions generated. It strengthens employee commitment to the decision.
Which of the following personality traits and values support an independent imagination?
Moderately low need for affiliation High openness to experience
Which are activities that build creativity in organizations?
Problem redefinition Design thinking Associative play Cross-pollination
Xavier met with his supervisor to discuss a problem he was having with a coworker. After listening for a few minutes, his supervisor said, "The problem is that you need to stop taking things so personally." This is an example of which limitation in effective problem identification?
Solution-focused problem identification
______ occurs when people with vested interests present their interpretation of a problem or opportunity in an effort to influence the decision maker.
Stakeholder framing
Under which of the following circumstances would employee involvement in decision making be preferable?
The problem relates to a nonprogrammed decision.
______ involves complex calculations of data to produce a formula that points to the best choice of all alternatives.
The rational choice paradigm
Which rule for design thinking stresses the importance of building low-cost prototypes as a rich form of communication?
The tangible rule
True or false: Creativity helps us in the decision making process because it assists us in visualizing the future and seeing the impact of our alternatives.
True
True or false: Decisiveness can negatively impact decision making because quickly forming an opinion on a problem or opportunity can short-circuit the decision-making process.
True
Art classes, impromptu storytelling, and acting are all forms of ______.
associative play
When evaluating decisions, people often ignore or downplay the negative outcomes and overemphasize the positive outcomes of the decision. This is known as ______.
confirmation bias
An organizational culture that discourages complacency and satisfaction with the status quo is referred to as ______.
divine discontent
The rational choice paradigm completely ignores the effect of ______ in human decision making.
emotions
The degree to which employees influence how their work is organized and carried out is known as:
employee involvement
Jacqueline is bidding against several other people on an item at an auction. She knows the bid is already too high, but she's doesn't want to give up, so she keeps bidding. This is an example of ______.
escalation of commitment
People have a tendency to be more creative when they ______.
have a comfortable level of job security
The alternative that the decision maker prefers and that is used as a comparison with other choices is referred to as the ______.
implicit favorite
According to research, we pay less attention to details and rely on a more programmed decision routine when we are ______.
in a positive mood
One of the problems with publicly establishing a preset level at which a decision is abandoned or reevaluated is that ______.
it may be difficult to identify an appropriate point to abandon a project
The tendency to define problems in terms of a preferred solution happens because _____.
it provides comforting closure to an ambiguous problem
An organizational culture in which leaders recognize and accept reasonable mistakes as part of the creative process is referred to as a(n) ______orientation.
learning
Visual or relational images in our mind that fill in information we don't immediately see and help us understand and navigate in our surrounding environment are referred to as ______.
mental models
In the song "The Boxer", Paul Simon sings, "A man hears what he wants to hear and disregards the rest." This would be an example of ______.
perceptual defenses
The stage in the creative process model in which we attempt to develop an understanding of the problem and investigate information relevant to the issue is known as ______.
preparation
The gap between "what is" and "what ought to be" is referred to as a(n) ______.
problem
A ______ decision is one that has a "ready-made" solution because it has been resolved in the past.
programmed
Alicia has to order copier toner again, so she consults the online catalog of the company's office supply vendor to see if either of her company's approved brands is on sale. This is an example of a(n) ______ decision.
programmed
"If it looks like a duck, quacks like a duck, and walks like a duck, it's probably a duck" is an example of the ______.
representativeness heuristic
The old saying, "Close enough is good enough" is an example of ______.
satisficing
Jackson has had a lot of success in investing for his clients over the last few years, but his investments have soured this past quarter. Instead of re-evaluating his investment strategy, he tells himself that his investment decisions were sound and it's only a matter of time before the market turns around. This is an example of the ______.
self-justification effect
Janys was planning a trip to the beach. However, she recently saw a frightening video of a shark attack and she now thinks it is likely that there will be shark attack at the beach. This is an example of ______.
the availability heuristic
Jake bought stock in a company several months ago and has seen it lose value ever since then. The stock is now worth less than half of what he paid for it, but he doesn't want to sell it now and accept the loss. He'd rather hold onto it, hoping that the stock will recover, even though he knows it is unlikely. This is an example of ______.
the prospect theory effect
Sophocles once said, "Quick decisions are unsafe decisions." This quote illustrates which of the following problems with problem identification?
Decisive leadership
Which of the following energizes us to make an initial preferred choice even before we have evaluated alternatives?
Emotion
Perceptual defenses cause us to ______.
block out information that threatens our self-concept
The concept that decision makers process limited and imperfect information and rarely select the best choice is referred to as ______.
bounded rationality
Creative people possess both practical and_______ intelligence.
cognitive
Calculating the conventionally accepted "right answer" to a logical problem is referred to as ______.
convergent thinking
______ is a creative process that is focused on generating innovative solutions by applying both intuition and analytical thinking.
Design thinking
Emotions affect the evaluation of alternatives in the decision-making process in which of the following ways?
Emotions determine our preferences for each alternative before we consciously evaluate them. We "listen in" on our emotions to gain guidance when making choices.
Under which of the following circumstances should employees be involved in the decision-making process?
If they possess more knowledge and experience than the supervisor If they are unwilling to accept a decision without their involvement
Which of the following elements does design thinking draw on to help employees in the decision-making process? (Check all that apply.)
Intuition Creative thinking Logical analysis
Which statements are true about the self-enhancement effect?
It can prevent recognition of a problem. It can lead to escalation of commitment. It is largely unconscious.
How do mental models affect the decision-making process?
They prevent decision makers from seeing unique problems or opportunities.
Sherri had never traveled to New York City before, but she had been on recent business trips to Albuquerque and Phoenix. When she learned that that the price of the hotel room she wanted was $260 per night, she was shocked because she thought that New York hotels would be priced similarly to those in Albuquerque and Phoenix. This is an example of the ______.
anchoring and adjustment heuristic
Joachim is the sales manager of a large car dealership. He wants to increase sales significantly over the next 12 months, and he and his staff have brainstormed several ideas to achieve this. Joachim now has to choose among these alternatives. Joachim is involved in the process of ______.
decision making
The process of making choices among alternatives with the intention of moving toward a desired state of affairs is known as ______.
decision making
________thinking involves reframing the problem in a unique way and generating different approaches to the issue.
divergent
The ability to sense when a problem or opportunity exists and to select the best course of action without conscious reasoning is referred to as:
intuition
A(n)______is a deviation between the current and desired situation.
problem
Systematic thinking about alternative futures and what an organization should do to anticipate and react to those environments is known as ______.
scenario planning
Jaime championed making changes in the company's employee benefits package but now sees that many employees are angered over the changes. Instead of suggesting modifications to her plan, she tells herself that she couldn't have implemented the project without others' help, so she isn't completely to blame. This is an example of the ______.
self-justification effect
Selecting a preferred alternative and then skewing other alternatives to make the chosen one appear to be "the best" is known as ______.
the implicit favorite
The tendency to experience stronger negative emotions when losing something of value than the positive emotions experienced when gaining something of equal value is referred to as ______.
the prospect theory effect
You've gone to the movie theater to see the latest release by your favorite actor. Ten minutes into the film, you realize that it's a loser, but instead of walking out, you stay to watch the rest of the movie because you figure that you've already spent $9.50 for a movie ticket and $6.50 for popcorn. This is an example of ______.
the sunk costs effect
True or false: Emotional markers form our preferences for alternatives before we consciously think about our choices.
True
True or false: Employee involvement serves to strengthen employee commitment to the decision because they are involved in making the decision.
True
Tyler is a die-hard Iowa Hawkeyes football fan, and he just bought season's tickets. He tells everyone about the games the Hawkeyes won but doesn't seem to acknowledge the games they lost to some inferior opponents. This is an example of ______.
confirmation bias
The ______ refers to a decision maker's tendency to estimate the probability of something occurring by how easily we can recall those events.
availability heuristic
______ is the development of original ideas that make a socially recognized contribution.
creativity
The tendency to repeat an apparently bad decision or allocate more resources to a failing course of action is referred to as ______.
escalation of commitment
The stage in the creative process model in which we put the problem aside, but our mind is still working on a solution in the background, is referred to as ______.
incubation
Amanda saw a new employee in the cafeteria and noticed that he was dressed conservatively and wore glasses. She knew that the accounting department had several openings and assumed that the new employee was an accountant. This is an example of ______.
the representativeness heuristic
