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Questions and Answers
What is the process by which managers respond to opportunities and threats by analyzing options and making determinations?
Which type of decision making is described as a complex, uncertain process?
What are the six steps that managers should take to make the best decisions called?
What term refers to the advantages and disadvantages of group decision making?
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What plays a role in helping managers to improve their decisions and is associated with creating a learning organization?
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Which type of decision making involves routine, virtually automatic decision making that follows established rules or guidelines?
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What is the term for nonroutine decision making that occurs in response to unusual, unpredictable opportunities and threats?
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What is the term for feelings, beliefs, and hunches that come readily to mind and require little effort and information gathering, resulting in on-the-spot decisions?
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According to the administrative model, which concept explains cognitive limitations that constrain one’s ability to interpret, process, and act on information?
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What is the prescriptive approach to decision making based on the assumption that the decision maker can identify and evaluate all possible alternatives and their consequences?
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In managerial decision making, what term refers to feelings, beliefs, and hunches that come readily to mind and require little effort and information gathering, resulting in on-the-spot decisions?
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What concept in the administrative model explains cognitive limitations that constrain one’s ability to interpret, process, and act on information?
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What is the term for nonroutine decision making that occurs in response to unusual, unpredictable opportunities and threats?
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What is the prescriptive approach to decision making called, based on the assumption that the decision maker can identify and evaluate all possible alternatives and their consequences?
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Which type of decision making involves routine, virtually automatic decision making that follows established rules or guidelines?
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In the context of managerial decision making, which concept refers to cognitive limitations that constrain one’s ability to interpret, process, and act on information?
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What type of decision making involves routine, virtually automatic decision making that follows established rules or guidelines?
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According to the classical model of decision making, what is the prescriptive approach based on the assumption that the decision maker can identify and evaluate all possible alternatives and their consequences?
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What concept explains why decision making is inherently uncertain and risky and why managers usually make satisfactory rather than optimum decisions according to the administrative model?
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Which type of decision making occurs in response to unusual, unpredictable opportunities and threats, with no rules because the situation is unexpected or uncertain?
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Study Notes
Decision Making Process
- Managers respond to opportunities and threats by analyzing options and making determinations through a process of decision making.
Types of Decision Making
- Programmed Decision Making: involves routine, virtually automatic decision making that follows established rules or guidelines.
- Non-programmed Decision Making: occurs in response to unusual, unpredictable opportunities and threats, with no rules because the situation is unexpected or uncertain.
Steps in Decision Making
- Managers should take six steps to make the best decisions:
- Problem definition
- Identification of alternatives
- Evaluation of alternatives
- Choice of an alternative
- Implementation of the decision
- Review and evaluation of the decision
Group Decision Making
- Advantages and Disadvantages: refers to the pros and cons of group decision making.
Improving Decisions
- Creating a Learning Organization helps managers improve their decisions.
Cognitive Limitations
- Bounded Rationality explains cognitive limitations that constrain one's ability to interpret, process, and act on information.
Decision Making Approaches
- Administrative Model: based on the assumption that decision makers are constrained by cognitive limitations and make satisfactory rather than optimum decisions.
- Classical Model: based on the assumption that the decision maker can identify and evaluate all possible alternatives and their consequences.
Decision Making Challenges
- Satisficing: concept explains why decision making is inherently uncertain and risky and why managers usually make satisfactory rather than optimum decisions.
Intuition in Decision Making
- Intuition: refers to feelings, beliefs, and hunches that come readily to mind and require little effort and information gathering, resulting in on-the-spot decisions.
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Description
Test your understanding of managerial decision making, programmed and nonprogrammed decisions, and nonprogrammed decision making in the context of entrepreneurship and creativity.
