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Questions and Answers
What type of decisions are made based on pre-established rules, procedures, and policies of an organization?
What type of decisions are made based on pre-established rules, procedures, and policies of an organization?
Who formulated the key steps in the decision-making process?
Who formulated the key steps in the decision-making process?
Which type of decision deals with organizational objectives and policy matters?
Which type of decision deals with organizational objectives and policy matters?
What is the third activity in Simon & March's decision-making process?
What is the third activity in Simon & March's decision-making process?
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Which decision-making model presupposes that there is one best outcome?
Which decision-making model presupposes that there is one best outcome?
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What is the last step in Terry's decision-making process?
What is the last step in Terry's decision-making process?
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What is the main characteristic of a Rational Decision Model?
What is the main characteristic of a Rational Decision Model?
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Which type of decision is made for unprecedented situations?
Which type of decision is made for unprecedented situations?
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What is a key assumption of the Rational Decision Model?
What is a key assumption of the Rational Decision Model?
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What is a limitation of the Rational Decision Model?
What is a limitation of the Rational Decision Model?
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What is the name of the model that Herbert Simon proposed as an alternative to the Rational Decision Model?
What is the name of the model that Herbert Simon proposed as an alternative to the Rational Decision Model?
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What type of rationality is concerned with the selection of preferred behavior alternatives in terms of some system of values?
What type of rationality is concerned with the selection of preferred behavior alternatives in terms of some system of values?
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What type of rationality is oriented towards organizational goals?
What type of rationality is oriented towards organizational goals?
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What did Herbert Simon reject as being based on unrealistic assumptions?
What did Herbert Simon reject as being based on unrealistic assumptions?
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What is a characteristic of the Consciously rational type of rationality?
What is a characteristic of the Consciously rational type of rationality?
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What is a difference between Objectively rational and Subjectively rational?
What is a difference between Objectively rational and Subjectively rational?
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What type of decisions are made to deal with novel and unstructured affairs?
What type of decisions are made to deal with novel and unstructured affairs?
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Which of the following is a characteristic of Programmed Decisions?
Which of the following is a characteristic of Programmed Decisions?
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What is the technique used in Modern Decision Making for Programmed Decisions?
What is the technique used in Modern Decision Making for Programmed Decisions?
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Who classified decisions into Organizational and Personal Decisions?
Who classified decisions into Organizational and Personal Decisions?
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What type of decisions can be delegated to others?
What type of decisions can be delegated to others?
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What type of decisions involve reflections on past situations and repeating past decisions?
What type of decisions involve reflections on past situations and repeating past decisions?
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Who enumerated the classifications of decision as Generic and Unique Decisions?
Who enumerated the classifications of decision as Generic and Unique Decisions?
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What is the main difference between Programmed and Non-programmed Decisions?
What is the main difference between Programmed and Non-programmed Decisions?
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Study Notes
Types of Decisions
- Unique decisions: new decisions made to resolve unprecedented situations
- Routine decisions: made for day-to-day operations, based on pre-established rules and procedures, decision-making power delegated to middle and lower levels
- Strategic decisions: made for organizational objectives and policy matters, non-routine, made by top-level management
Decision-Making Process
- Defining the problem
- Finding alternatives
- Selecting alternatives and getting feedback
- Finalizing one alternative
- Terry's (1956) steps:
- Determine the problem
- Acquire general background information and viewpoints
- State the best course of action
- Investigate and evaluate alternatives
- Make the decision and implement it
- Institute follow-up and modify if necessary
- Simon & March's (1960) four activities:
- Intelligence Activity
- Design Activity
- Choice Activity
- Evaluating Activity
Decision-Making Models
Rational Decision Model
- Assumes one best outcome, optimizing decision-making model
- Factors in objectivity and logic instead of subjectivity and intuition
- Goal: identify a problem, pick a solution, and find an answer
- Assumptions:
- Consider every option
- Know future consequences of each decision
- Utility (value) associated with each outcome
Limitations of the Rational Model
- Requires a great deal of time and information
- Assumes rational, measurable criteria are available and agreed upon
- Assumes accurate, stable, and complete knowledge of alternatives, preferences, goals, and consequences
- Personal factors (beliefs, values, education, and intellectual capacity) influence decision-making
Simon's Bounded Rationality Model
- Herbert Simon's work on "Administrative Behavior" (1947) rejected the rationality model
- Rationality is concerned with selecting preferred behavior alternatives in terms of a system of values
- Types of rationality:
- Objectively rational
- Subjectively rational
- Consciously rational
- Deliberately rational
- Organizationally rational
- Personally rational
Types of Decisions
- Programmed decisions: repetitive and routine, made using standard procedures
- Non-programmed decisions: novel and unstructured, require judgement and creativity
- Organizational decisions: can often be delegated, made for the organization's goals
- Personal decisions: cannot be delegated, made for individual goals
- Generic decisions: repeat past decisions based on past experiences
- Unique decisions: made for unprecedented situations
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Description
This quiz covers the different types of decisions in management, including unique, routine, and strategic decisions. Learn about the characteristics and importance of each type.
