Decision Making Steps

These flashcards summarize key concepts from the lecture on decision making, including the steps involved, definitions of problems and opportunities, techniques for analysis, and strategies to improve decision quality.

What are the six steps of effective decision making from a managerial perspective?

The six steps are: 1) Recognition of decision requirement, 2) Diagnosis and analysis of causes, 3) Development of alternatives, 4) Selection of the desired alternative, 5) Implementation of the chosen alternative, 6) Evaluation and feedback.

What defines a problem in the context of decision making?

A problem occurs when organizational accomplishments are less than established goals, indicating that some aspect of performance is unsatisfactory.

What defines an opportunity in decision making?

An opportunity exists when managers see potential accomplishments that exceed specified current goals, indicating a possibility to enhance performance beyond current levels.

What is the purpose of diagnosis in decision making?

The purpose of diagnosis is to analyze underlying causal factors associated with a decision situation to refine understanding and identify the true problem.

What technique helps managers get to the root cause of a problem?

The 'Five Whys' technique allows managers to explore the root cause of a problem by continually asking 'why' to peel back layers of symptoms.

What is the role of alternative solutions in decision making?

Generating multiple alternative solutions allows managers to explore different possible actions to correct problems or exploit opportunities.

What is risk propensity?

Risk propensity refers to a manager's willingness to undertake risk in exchange for the opportunity of gaining an increased payoff.

What is the importance of evaluation and feedback in the decision making process?

Evaluation and feedback allow decision makers to gather information about the effectiveness of a decision and make adjustments or new decisions as necessary.

What is groupthink?

Groupthink refers to the tendency of group members to suppress contrary opinions and prioritize harmony over high-quality decision making.

How can managers avoid biases in decision making?

Managers can use techniques such as brainstorming, evidence-based decision making, rigorous debate, and pre-mortems to reduce biases and improve decision quality.