Chapter 10
- Are most decisions today made at the top of the organization (by managers) or by lower-level employees? Do you think this has changed over time?
- What are some of the benefits of having groups make decisions? What are some of the potential problems?
- What does the term “groupthink” mean to you?
- What are some way that biases might enter into individual decision-making?
- When are groups better at making decisions than individuals? When are individuals better?
Top-Down and Empowered Decisions: What is the difference between these two approaches? Page Ref: 341
Potential Benefits and Problems of Decision-Making Groups: What are they? Page Ref: 345-346
Groupthink: What is it and how does it affect decision-making? Page Ref: 346
Biased Nature of Individual Decisions: What are the primary biases in individual decision-making? What do they mean? Page Ref: 356-359
When are Groups Superior to Individuals? When are group decisions superior to individual decisions? Page Ref: 361
Copyright
- General Model of Decision-Making
- Types of Organizational Decisions
- Factors Affecting Decisions in Organizations
- How Individual Decisions are Made
- Imperfect Decisions
- Group Decisions vs. Individual Decisions
- Definition: the process of making choices from among several alternatives
- Decision making is one of the most important – if not the most important – of all managerial activities.
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- General Model of Decision-Making
- Types of Organizational Decisions
- Factors Affecting Decisions in Organizations
- How Individual Decisions are Made
- Imperfect Decisions
- Group Decisions vs. Individual Decisions
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- General Model of Decision-Making
- Types of Organizational Decisions
- Factors Affecting Decisions in Organizations
- How Individual Decisions are Made
- Imperfect Decisions
- Group Decisions vs. Individual Decisions
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- Exercise on Page 370-371 in text
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- Potential benefits
- Pooling of resources
- Specialization of labor
- Greater acceptance
- Potential problems
- Wasted time
- Disruptive conflict
- Intimidation by group leaders
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- The tendency for members of highly cohesive groups to so strongly conform to group pressures regarding a certain decision that they fail to think critically, rejecting the potentially correcting influences of outsiders
- Invasion plan initiated by Eisenhower administration, but Kennedy White House "uncritically accepted" CIA's plan.
- When advisors, such as Arthur M. Schlesinger, Jr. and Senator J. William Fulbright, attempted to present objections to the plan, Kennedy team ignored objections
- Eventually Schlesinger minimized his own doubts, performing self-censorship.
- Kennedy team stereotyped Castro and the Cubans by failing to question the CIA about its many false assumptions, including the ineffectiveness of Castro's air force, the weakness of Castro's army, and the inability of Castro to quell internal uprisings.
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- General Model of Decision-Making
- Types of Organizational Decisions
- Factors Affecting Decisions in Organizations
- How Individual Decisions are Made
- Imperfect Decisions
- Group Decisions vs. Individual Decisions
IMPERFECT DECISIONS
Sure gain of $240
25% chance to gain $1,000 and 75% chance to gain nothing
Sure loss of $740
75% chance to lose $1,000 and 25% chance to lose nothing
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Sure gain of $240
25% chance to gain $1,000 and 75% chance to gain nothing
$240 Gain
$250 Gain
“Better!”
Expected Return
Sure loss of $740
75% chance to lose $1,000 and 25% chance to lose nothing
Expected Return
$740 Loss
$750 Loss
“Better!”
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In general, individuals tend to:
- be risk averse when offered a gain
- but be risk-taking when faced with a loss.
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- The tendency for people to make different decisions based on how a problem is presented to them.
- Framing Effects
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- Implicit favorite
- Confirmation Candidates
- Hindsight
- Hindsight is 20-20
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Person Sensitivity: Tendency to give too little credit to others when things are going poorly and too much credit when things are going well
Remember the Fundamental Attribution Error?
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Escalation of Commitment: Continuing to support unsuccessful courses of action - “Sunk Costs”
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- General Model of Decision-Making
- Types of Organizational Decisions
- Factors Affecting Decisions in Organizations
- How Individual Decisions are Made
- Imperfect Decisions
- Group Decisions vs. Individual Decisions
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- Top-Down and Empowered Decisions: What is the difference between these two approaches? Page Ref: 341
- Potential Benefits and Problems of Decision-Making Groups: What are they? Page Ref: 345-346
- Groupthink: What is it and how does it affect decision-making? Page Ref: 346
- Biased Nature of Individual Decisions: What are the primary biases in individual decision-making? What do they mean? Page Ref: 356-359
- When are group decisions superior to individual decisions? Page Ref: 361
Top-Down and Empowered Decisions: What is the difference between these two approaches? Page Ref: 341
Potential Benefits and Problems of Decision-Making Groups: What are they? Page Ref: 345-346
Groupthink: What is it and how does it affect decision-making? Page Ref: 346
Biased Nature of Individual Decisions: What are the primary biases in individual decision-making? What do they mean? Page Ref: 356-359
When are Groups Superior to Individuals? When are group decisions superior to individual decisions? Page Ref: 361
Copyright
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