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1、Chapter 6DECISION MAKING:THE ESSENCE OFTHE MANAGERSJOB Prentice Hall, 20026-116 -Learning ObjectivesYou should learn to:Outline the steps in the decision-making processExplain why decision making is so pervasive in organizationsDescribe the rational decision makerContrast the perfectly rational and
2、boundedly rational approaches to decision makingExplain the role that intuition plays in the decision-making process Prentice Hall, 20026-226 -Learning Objectives (cont.)You should learn to:Identify the two types of decision problems and the two types of decisions that are used to solve themDifferen
3、tiate the decision conditions of certainty, risk, and uncertaintyDescribe the different decision-making styles Prentice Hall, 20026-336 -Decisionschoices from two or more alternativesall organizational members make decisionsDecision-Making Processa comprehensive, 8-step processStep 1 - Identifying a
4、 Problemproblem - discrepancy between an existing and a desired state of affairsmust be such that it exerts pressure to actmanager is unlikely to characterize a situation as a problem unless s/he has resources necessary to actDecision Making Prentice Hall, 20026-446 -The Decision-Making ProcessProbl
5、emIdentification“My salespeopleneed new computers”Identification of Decision CriteriaPriceWeightWarrantyScreen typeReliabilityScreen sizeAllocation ofWeights to CriteriaReliability 10Screen size 8Warranty 5Weight 5Price 4Screen type 3Development of AlternativesAcerCompaqGatewayHPMicromediaNECSonyTos
6、hibaImplementationof an AlternativeGatewayEvaluationof DecisionEffectivenessAnalysis ofAlternativesAcerCompaqGatewayHPMicromediaNECSonyToshibaSelection of anAlternativeAcerCompaqGateway HPMicromediaNECSonyToshiba Prentice Hall, 20026-556 - Assessed Values of Notebook Computer Alternatives Against De
7、cision Criteria Prentice Hall, 20026-776 -Evaluation of Laptop Computer Alternatives Against Criteria and Weights Prentice Hall, 20026-886 -Decisions in the Management Functions Prentice Hall, 20026-10106 -The Manager As Decision MakerRational Decision Makingdecisions are consistent, value-maximizin
8、g choices within specified constraintsmanagers assumed to make rational decisionsAssumptions of Rationality - decision maker would:be objective and logicalcarefully define a problemhave a clear and specific goalselect the alternative that maximizes the likelihood of achieving the goalmake decision i
9、n the firms best economic interestsmanagerial decision making seldom meets all the tests Prentice Hall, 20026-11116 -Assumptions Of RationalityRationalDecisionMakingProblem isclear andunambiguousSingle, well-defined goalis to be achievedAll alternativesand consequencesare knownPreferencesare clearPr
10、eferencesare constantand stableNo time or costconstraints existFinal choicewill maximizepayoff Prentice Hall, 20026-12126 -The Manager As Decision Maker (cont.)Role of Intuitionintuitive decision making - subconscious process of making decisions on the basis of experience and accumulated judgmentdoe
11、s not rely on a systematic or thorough analysis of the problemgenerally complements a rational analysis Prentice Hall, 20026-14146 -What Is Intuition?Decisions basedon experienceDecisions basedon feelings andemotionsDecisions basedon ethical valuesor cultureDecisions basedon subconsciousdataDecision
12、s basedon skills,knowledge,or trainingIntuitionAffect-initiateddecisionsExperienced-based decisionsValues orethics-baseddecisionsSubconsciousmentalprocessingCognitive-baseddecisions Prentice Hall, 20026-15156 -The Manager As A Decision Maker (cont.)Types of Problems and Decisions (cont.)Poorly-Struc
13、tured Problems - new, unusual problems for which information is ambiguous or incompleteNonprogrammed Decisions - used to address poorly- structured problemsproduce a custom-made responsemore frequent among higher-level managersfew decisions in the real world are either fully programmed or nonprogram
14、med Prentice Hall, 20026-17176 -Types Of Problems, Types Of Decisions, And Level In The OrganizationProgrammedDecisionsNonprogrammedDecisionsLevel inOrganizationTopLowerWell-structuredIll-structuredType ofProblem Prentice Hall, 20026-18186 -The Manager As A Decision Maker (cont.)Decision-Making Cond
15、itionsCertainty - outcome of every alternative is knownidealistic rather than realisticRisk - able to estimate the probability of outcomes stemming from each alternativeexpected value - the conditional return from each possible outcomemultiply expected revenue from each outcome by the probability of
16、 each outcome Prentice Hall, 20026-19196 -Expected Value for Revenues from the Addition of One Ski Lift Prentice Hall, 20026-20206 -The Manager As A Decision Maker (cont.)Decision-Making Conditions (cont.)Uncertainty - not certain about outcomes and unable to estimate probabilitiespsychological orie
17、ntation of decision makermaximax choice - optimisticmaximizing the maximum possible payoffmaximin choice - pessimistic maximizing the minimum possible payoffminimax - minimize the maximum “regret” Prentice Hall, 20026-21216 -Payoff Matrix Prentice Hall, 20026-22226 -The Manager As A Decision Maker (
18、cont.)Decision-Making Stylestwo dimensions define the approach to decision makingway of thinking - differs from rational to intuitivetolerance for ambiguity - differs from a need for consistency and order to the ability to process many thoughts simultaneouslydefine four decision-making stylesDirective - fast, efficient, and logicalAnalytic - careful and able to adapt or cope with new situationsConceptual - able to find creative solutionsBehavioral - seek acceptance of decisions Prent
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