Chapter 7: Decision-Making

Chapter 7: Decision-Making

• Decision-making involves choosing between different options or courses of action.
• Programmed decisions are routine and repetitive, while non-programmed decisions are novel and require more thought; systematic error involves consistent deviations from optimal decisions.
• In classical decision-making, managers aim to make rational decisions by gathering all available information and choosing the optimal solution.
• Faced with ambiguity or incomplete information, managers rely on intuition, experience, and judgment.
• Satisficing is choosing the first acceptable solution rather than searching for the optimal one.
• Managerial decision-making include: identifying the problem, generating alternatives, evaluating alternatives, choosing an alternative, implementing the decision, and evaluating the results.
• Creativity can be enabled by fostering a culture of experimentation, encouraging diverse perspectives, and providing resources for innovation.
• Effective decision-making includes: clear objectives, relevant information, logical reasoning, and commitment to implementation.
• Biases can arise from various sources, such as cognitive limitations, emotional influences, and social pressures.

Chapter 8: Planning

• A mission statement defines the organization's purpose and values, while a vision statement outlines its desired future state.
• A plan has unity when all its elements are aligned and work together towards a common goal.
• Planning occurs at corporate, business, division, and department/functional levels, each with its own scope and objectives.
• The time period defines how long a plan applies or endures.
• Rolling plans are continuously updated and adjusted, while standing plans remain in effect until changed or canceled.
• A policy is a general guideline for decision-making, a rule is a specific action to be taken in a particular situation, and a standard operating procedure (SOP) is a detailed set of instructions for performing a task.
• The first step in creating a mission statement is to define the organization's purpose and values.
• SMART goals are specific, measurable, achievable, relevant, and time-bound; a SWOT analysis identifies an organization's strengths, weaknesses, opportunities, and threats.

Chapter 10: Organizational Structure

• There is no single "best" way to design an organization; the optimal structure depends on factors such as the environment, strategy, and technology.
• A low-cost strategy should be used when competing on price, while a differentiation strategy should be used when offering unique products or services.
• Factors influencing managers' choice of organizational structure include: the environment, strategy, technology, size, and life cycle.
• In a stable market environment with many resources, companies can use a more mechanistic structure, while in an unstable market environment with limited resources, companies need to be more organic.
• Flexible structures should be used when the environment is dynamic and uncertain.
• Technology refers to the tools, techniques, and processes used to transform inputs into outputs.
• Centralized communication and structure are used when decisions need to be made quickly and efficiently, while decentralized communication and structure are used when decisions need to be more innovative and responsive.
• Job design involves determining the tasks and responsibilities of a job, job enlargement involves increasing the scope of a job by adding more tasks, and span of control refers to the number of employees a manager can effectively supervise.

Chapter 11: Control

• The control managerial function ensures that activities are aligned with plans and objectives, resulting in improved performance and reduced risk.
• The stages of the control function are: setting standards, measuring performance, comparing performance to standards, and taking corrective action; begins with setting standards.
• Organizational performance is hindered when there are unclear goals, inadequate resources, poor communication, or a lack of accountability.
• Actual performance is measured through various metrics, such as financial statements, customer surveys, and employee feedback; measuring qualitative performance is the hardest to measure.
• The final step in the control process is to evaluate the effectiveness of the corrective action and make adjustments as needed.
• ROI (return on investment) is a financial metric used to evaluate the profitability of an investment; used because it allows companies to accurately measure performance.
• Stewardship refers to how well managers have protected organizational resources to be able to meet short-term obligations.

Chapter 12: Human Resource Management

• HR management systems ensure that the organization has the right people with the right skills in the right jobs.
• Performance appraisals evaluate employee performance, training and development enhance employee skills, and recruitment and selection attract and hire qualified candidates.
• Labor relations refers to the relationship between management and employees, particularly in unionized settings.
• Equal employment opportunity ensures that all individuals have an equal chance to be hired and promoted, while equal pay ensures that men and women are paid the same for doing the same work.
• The Age Discrimination in Employment Act protects workers 40+, the Americans with Disabilities Act prohibits discrimination based on disability, and the Family and Medical Leave Act provides unpaid leave for family and medical reasons.
• Demand forecasting predicts future staffing needs, job analysis identifies the tasks and responsibilities of a job, and job descriptions summarize the duties, responsibilities, and qualifications for a job.
• Internal recruitment involves hiring from within the organization, while external recruitment involves hiring from outside the organization.