5 Questions
What is the nature of managerial decision making?
Responding to opportunities and threats by analyzing options and making determinations
What is programmed decision making?
Routine, virtually automatic decision making that follows established rules or guidelines
What is nonprogrammed decision making characterized by?
Complex, uncertain process
What can lead managers to make poor decisions?
Cognitive biases
What role do organizational learning and creativity play in helping managers improve their decisions?
They help in improving decisions
Study Notes
Managerial Decision Making
- Managerial decision making is a process that involves selecting a course of action from multiple alternatives to achieve organizational goals and objectives.
Types of Decision Making
- Programmed Decision Making: involves making repetitive and routine decisions that are based on established policies, procedures, and rules.
- Nonprogrammed Decision Making: characterized by uniqueness, novelty, and uncertainty, requiring creative and innovative solutions.
Drivers of Poor Decision Making
- Lack of Information: incomplete or inadequate data can lead to poor decisions.
- Biases and Assumptions: personal biases and assumptions can influence decision making, leading to suboptimal outcomes.
- Time Pressure: hasty decisions made under time constraints can be poor.
- Groupthink: pressure to conform to group opinions can lead to poor decisions.
Improving Decision Making
- Organizational Learning: enables managers to learn from past experiences and adapt to changing circumstances, improving decision making.
- Creativity: encourages managers to think outside the box and generate innovative solutions, leading to improved decision making.
Test your knowledge of managerial decision making with this quiz. Explore the nature of programmed and nonprogrammed decisions, understand the complexities of nonprogrammed decision making, and learn about cognitive biases that can impact decision making.
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