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Managing Information and Decision Making (How do managers arrive at …
Managing Information and Decision Making
POLC, information and
decision-making
Managing and decision-making
Decision-making influenced by sources, quality,
and reliability of information
The execution of the managerial functions of POLC
results in decision-making, often daily
Big Data and its associated analytics changing contemporary debates and arguments around decision-making
How do managers arrive at
decisions?
Bounded Rationality
“Good enough” decisions –
“satisficing”
Decisions made within the parameters of a simplified model that captures the essential features of a problem
Bounded by the limitations and
constraints, managers attempt to
behave rationally
Intuition
Accumulated
Judgment
Previous Experience
“Gut-Level Feeling
Rationality
Managerial decision making is assumed to be rational
Rational decisions made by managers “maximise”
economic benefit for the organization
Assumes that:
– The problem is clear and unambiguous
– A single, well-defined goal is to be achieved
– All alternatives and consequences are known
– Preferences are clear
– Preferences are constant and stable
– No time or cost constraints exist
– Final choice will maximise payoff
Managerial problems and
decisions
Well structured problems and programmed
decisions
– Structured problems are easily defined
Programmed decisions are those handled by a
routine approach
Un-structured problems and non-programmed
decisions
Un-structured problems are new or unusual
– Non-programmed decisions need a custom
approach
Group Decision-making
Advantages
More complete information & knowledge
• More diverse alternatives
• Increases acceptance of a solution
• Increase legitimacy
Disadvantages
• Time consuming
• Minority domination
• Pressure to conform
• Ambiguous responsibility
https://youtu.be/FvMSRe4-cbA