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Managing Information & Decision-Making (Errors & Biases…
Managing Information & Decision-Making
POLC, information and decision-making
influence by sources, quality and reliability of information
engage in critical thinking, analysis and reflection
execution of managerial function of POLC
consider inclusiveness of data
Managerial problems and decisions
well structured problems
handled by a routine approach
problems are easily defined
un-structured problems
problems are new or unusual
need a custom approach
BIG DATA
Companies store large amounts of personal data, needs protection
Have to make sure customer info does not leak, which can harm reputation of company
Methods of Decision-Making
Rationality
Rational decisions
Maximise benefit for the organisation
Problem is clear and unambiguous
Bounded Rationality
Bounded by limitations (e.g.. information supply)
Intuition
Previous Experience
Gut-Feel
Past experiences affect this.
Accumulated Judgement
Conditions & Styles
Conditions
Certainty
Risk
Uncertainty
Styles
Linear
Uses external data & fact
Decisions are more rational
Non-Linear
Internal info source preference
Decisions based more on insight
group decision-making
advantages
more complete info. and knowledge
more diverse alternatives
increase acceptance of solution
increase legitimacy
disadvantage
time consuming
minority domination
pressure ti conform
ambiguous responsibility
Errors & Biases
Overconfidence
Immediate Gratification
Framing
Anchoring effect
Selective perception
Availability
Representation
Randomness
Sunk-costs
Self-serving
Hindsight