Decision-Making Process
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Questions and Answers

What is the last step in the decision-making process?

  • Generating alternatives and evaluating them
  • Evaluating the outcome of the decision to see if the problem has been resolved (correct)
  • Identifying the problem and defining the goal
  • Making the decision

    • What does the rational decision-making perspective assume?

  • Managers have limited ability to process information
  • Managers make decisions based on their experience and accumulated judgment
  • Managers make logical and consistent choices to maximize value (correct)
  • Managers rely on rules of thumb to simplify decision-making

    • What is bounded rationality?

  • Managers make logical and consistent choices to maximize value
  • Managers rely on rules of thumb to simplify decision-making
  • Managers make decisions rationally, but are limited by their ability to process information (correct)
  • Managers make decisions based on their experience and accumulated judgment

    • What is intuition in decision-making?

    <p>Making decisions on the basis of experience, feelings, and accumulated judgment</p> Signup and view all the answers

    What do managers use to simplify their decision-making?

    <p>Rules of thumb</p> Signup and view all the answers

    What is the initial step in the decision-making process?

    <p>Identifying a problem</p> Signup and view all the answers

    What is the purpose of weighing the decision criteria?

    <p>To give them the correct priority in the decision</p> Signup and view all the answers

    Which step in the decision-making process involves conveying the decision to those affected?

    <p>Step 7: Implementing the decision</p> Signup and view all the answers

    What is the primary purpose of decision-making?

    <p>To resolve a discrepancy between an existing and a desired condition</p> Signup and view all the answers

    What is done in Step 5 of the decision-making process?

    <p>Evaluating various alternatives based on criteria</p> Signup and view all the answers

    Study Notes

    Decision-Making Process

    • The decision-making process consists of 8 steps: identifying a problem, identifying decision criteria, allocating weights to the criteria, developing alternatives, evaluating alternatives, choosing the best alternative, implementing the decision, and evaluating the decision's effectiveness.

    Problem Identification

    • A problem is an obstacle that makes it difficult to achieve a desired goal or purpose.
    • Every decision starts with a problem, which is a discrepancy between an existing and a desired condition.

    Identifying Decision Criteria

    • Decision criteria are important factors that help resolve a problem.
    • Criteria are determined by one's objectives.

    Allocating Weights to the Criteria

    • Criteria are not equally important, so weights are assigned to prioritize them in the decision-making process.

    Developing Alternatives

    • The decision-maker lists viable alternatives that could resolve the problem.
    • This step requires creativity, and alternatives are only listed, not evaluated.

    Evaluating Alternatives

    • Alternatives are evaluated based on the identified criteria.
    • The decision-maker calculates the score for each alternative by multiplying the rank with the assigned weight for the given criteria.

    Choosing the Best Alternative

    • The best alternative is chosen based on the highest total score calculated in the previous step.

    Implementing the Decision

    • The decision is put into action by conveying it to those affected and getting their commitment.
    • The environment may need to be reassessed for any changes, especially for long-term decisions.

    Evaluating the Decision's Effectiveness

    • The outcome of the decision is evaluated to see if the problem has been resolved.

    Decision-Making Perspectives

    • There are three perspectives on decision-making: Rationality, Bounded Rationality, and Intuition.
    • Rationality involves making logical and consistent choices to maximize value.
    • Bounded Rationality involves making decisions rationally, but with limited information processing ability.
    • Intuition involves making decisions based on experience, feelings, and accumulated judgment.

    Decision-Making Styles

    • Managers may use their own particular style, "rules of thumb," or heuristics to simplify their decision-making.
    • Heuristics can be used to complement rational analysis or make decisions quickly with limited information.

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    Description

    Explore the eight-step decision-making process, from identifying a problem to evaluating the decision's effectiveness. Learn how to make informed decisions and overcome obstacles.

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