Decision Making and Problem Solving

Problem Solving and Decision Making

Problem vs. Problem Solving

  • A problem is the discrepancy between ideal and actual conditions.

  • Problem solving is the process of taking corrective action to meet objectives.

Decision Making

  • A decision involves choosing among alternatives.

  • Decision making is selecting an alternative course of action to solve a problem.

Programmed vs. Non-programmed Decisions

  • Non-programmed decisions: Address new, unfamiliar, complex, or significant issues. Strategic decisions fall under this category. Well-structured organizations minimize these.

  • Programmed decisions: Routine and repetitive, made according to specific procedures.

Steps in Problem Solving and Decision Making

  1. Identify and diagnose the problem.

  2. Develop alternative solutions.

  3. Evaluate alternative solutions (cost-savings analysis).

  4. Choose one alternative solution.

  5. Implement the decision.

  6. Evaluate and control the decision's effectiveness. Repeat if necessary.

Bounded Rationality

  • Limited mental abilities and external influences prevent entirely rational decisions.

  • Satisficing decisions: Meet a minimum standard of satisfaction.

  • Heuristics: Rule of thumb in decision making.

Influences on Decision Making

  • Intuition: Experience-based reasoning done unconsciously.

  • Personality and Cognitive Intelligence: Decisiveness is key.

  • Perfectionism: Can lead to indecisiveness.

  • Emotional Intelligence: Understanding feelings, empathy, and emotional regulation.

Key Factors of Emotional Intelligence

  • Self-awareness: Understanding your own emotions.

  • Self-management: Controlling emotions with honesty and integrity.

  • Social awareness: Empathy and intuition about organizational problems.

  • Relationship management: Interpersonal skills to communicate, resolve conflicts and build strong relationships.

Information Quality and Accessibility

  • High-quality information is crucial; accessibility is also important.

  • Anchoring: Over-weighting the first information received.

Other Considerations

  • Political Considerations: Political factors influence data consideration. The status quo trap ties decisions to political factors.

  • Degree of Certainty: Certainty, risk, and uncertainty.

  • Crisis and Conflict: Anticipate crises to make better decisions.

  • Values of the Decision Maker: Decisions are based on values.

  • Procrastination: Delaying action without a valid reason.

Decision-Making Styles

  • Differ based on information use and option creation.

  • Decisive: Values action, speed, efficiency, and consistency.

Group Problem Solving

  • Process involving several people contributing to a final decision.

Advantages:

  • Higher quality decisions, evaluation of thinking, acceptance and commitment, unblocking minds.

Disadvantages:

  • Time-consuming and can lead to compromising.

Nominal Group Technique (NGT)

  • Structured decision-making technique with limited interaction during idea generation.

Steps:

  1. Group assembles.

  2. Leader presents a question.

  3. Individual members write down ideas independently.

  4. Each member presents one idea.

  5. Group clarifies and evaluates suggestions.

  6. Silent, independent rating of alternatives; final decision is pooled outcome of individual votes.

Creativity and Innovation

  • Creativity: Developing novel ideas that can be put into action.

Creative Personality:

  • Emotionally open, flexible, breaks rules, unconventional.

Conditions Necessary for Creativity:

  • Expertise, creative-thinking skills, and internal motivation.

  • Environmental need plus conflict and tension.

  • Encouragement from others.

Creative Environment

  • Expertise: Necessary knowledge.

  • Flow experience: Heightened focus, productivity, and happiness.

  • Environmental Need: Stimulates goal setting.

  • Encouragement: Promotes imaginative thinking.

Creative and Innovative Organization

  1. Challenge: Right amount and type of challenge.

  2. Freedom: Choose how to accomplish a goal.

  3. Resources: Time and money.

  4. Rewards and recognition for innovative ideas.

  5. Time allocation for innovative thinking.

  6. Building on ideas of others.

Organizational Programs for Creativity Training

  • Brainstorming and appropriate physical surroundings.

Creativity-Building Suggestions

  1. Keep track of original ideas.

  2. Stay current and curious.

  3. Improve sense of humor.

  4. Adopt a risk-taking attitude.

  5. Identify most creative times.

  6. Step back from problems when blocked.

Self-Help Techniques

  • Play roles of explorer, artist, judge, and lawyer.

  • Engage in physical exercise.