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10 Cards in this Set

  • Front
  • Back
Models of Decision Making
1. the rational model
2. non-rational models
rational model
proposes that managers use a rational, four-step sequence when making decisions:
1. Identify the problem or opportunity (a problem exists when an actual situation and a desired situation differ; an opportunity represents a situation in which there are possibilities to do things that lead to results that exceed goals and expectations.
2. Generate alternative solutions
3. Evaluate alternatives and select a solution.
4. Implement and Evaluate the Solution Chosen.
Benefits of the rational model
1. the quality of decisions may be enhanced because they follow logic from knowledge and expertise.
2. It makes the reasoning behind a decision transparent and available to scrutiny.
3. If made public, it discourages the decider from acting on suspect considerations
optimizing
involves solving problems by producing the best possible solution.
Non-rational models of decision Making
attempt to explain how decisions are actually made:
1. Simon's normative model
2. The garbage can model
simon's normative Model
proposed to describe the process that managers actually use when making decisions which process is guided by bounded rationality and includes satisficing.
bounded rationality
the notion that decision makers are "bounded" or restricted by a variety of constraints when making decisions.
satisficing
choosing a solution that meets some minimum qualifications, one that is "good enough."
Most Frequent Causes of poor decision Making
1. Poorly defined processes and practices
2. Unclear company vision, mission, and goals.
3. Unwillingness of leaders to take responsibility
4. a lack of reliable, timely information
the garbage can model
decisions result from complex interaction between four independent streams of events: problems, solutions, participants, and choice opportunities