The main contents of the chapter consist of the following: The role of intuition, types of problems and decisions, decision-making conditions, classical model of decision making, the decision-making process, decisions in the management functions, making decisions-rationality. | Management Practices Lecture-24 1 Recap Decision Making Classical Model of Decision Making The Decision-Making Process Decisions in the Management Functions Making Decisions-Rationality 2 Today’s Lecture The Role of Intuition Types of Problems and Decisions Decision-Making Conditions 3 The Role of Intuition Intuitive decision making Making decisions on the basis of experience, feelings, and accumulated judgment. 4 4 What is Intuition? Source: Based on L. A. Burke and M. K. Miller, “Taking the Mystery Out of Intuitive Decision Making,” Academy of Management Executive, October 1999, pp. 91–99. 5 5 Types of Problems and Decisions Structured Problems Involve goals that are clear. Are familiar (have occurred before). Are easily and completely defined—information about the problem is available and complete. Programmed Decision A repetitive decision that can be handled by a routine approach. 6 6 Types of Programmed Decisions Policy A general guideline for making a decision about a structured | Management Practices Lecture-24 1 Recap Decision Making Classical Model of Decision Making The Decision-Making Process Decisions in the Management Functions Making Decisions-Rationality 2 Today’s Lecture The Role of Intuition Types of Problems and Decisions Decision-Making Conditions 3 The Role of Intuition Intuitive decision making Making decisions on the basis of experience, feelings, and accumulated judgment. 4 4 What is Intuition? Source: Based on L. A. Burke and M. K. Miller, “Taking the Mystery Out of Intuitive Decision Making,” Academy of Management Executive, October 1999, pp. 91–99. 5 5 Types of Problems and Decisions Structured Problems Involve goals that are clear. Are familiar (have occurred before). Are easily and completely defined—information about the problem is available and complete. Programmed Decision A repetitive decision that can be handled by a routine approach. 6 6 Types of Programmed Decisions Policy A general guideline for making a decision about a structured problem. Procedure A series of interrelated steps that a manager can use to respond (applying a policy) to a structured problem. Rule An explicit statement that limits what a manager or employee can or cannot do. 7 7 Problems and Decisions (cont’d) Unstructured Problems Problems that are new or unusual and for which information is ambiguous or incomplete. Problems that will require custom-made solutions. Nonprogrammed Decisions Decisions that are unique and nonrecurring. Decisions that generate unique responses. 8 8 Programmed versus Non programmed Decisions 9 9 Decision-Making Conditions Certainty A situation in which a manager can make an accurate decision because the outcome of every alternative choice is known. Risk A situation in which the manager is able to estimate the likelihood (probability) of outcomes that result from the choice of particular alternatives. 10 10 Decision-Making Conditions Uncertainty Limited information prevents estimation of outcome probabilities for .
