Foundations of Management - Week 4: Decision Making

The process of generating and choosing from a set of alternatives to solve a problem.

The more knowledge and skills employees possess

The notion that decision makers do not have the ability or resources to process all available information and alternatives to make an optimal decision.

When decision makers select the first acceptable alternative considered.

Tendency to base decisions on information that is readily available in memory

Estimate the probability of an event occurring

• Confirmation bias
• Anchoring bias
• Overconfidence bias
• Hindsight bias
• Framing bias
• Escalation of commitment bias

A way of saying "I knew it all along".

• Program A: If Program A is adopted, 200 people will be saved
• Program B: If Program B is adopted, there is a one-third probability that 600 people will be saved and a two-thirds probability that no people will be saved.

• Directive
• Analytical
• Conceptual
• Behavioral

• Brainstorming
• The nominal group technique
• The Delphi technique
• Computer-Aided decision making

Process to generate ideas and evaluate solutions

Process to generate ideas from physically dispersed experts.