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Managing Information & Decision-Making (POLC, information and decision…
Managing Information & Decision-Making
POLC, information and decision-making
Decision-making influenced by sources, quality, and reliability of information
Ability to engage in critical thinking, analysis, and reflection determines how well one makes decisions based on available 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
As organizational decisions increasingly become more data driven, managers need to consider inclusiveness of data (i.e. who uses it) in addition to the use of data for productive purposes
How do managers arrive at decisions?
Rationality
Managerial decision making is assumed to be rational
Rational decisions describe choices that are
consistent and value-maximising
Rational decisions made by managers “maximise” economic benefit for the organisation
Bounded Rationality
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
“Good enough” decisions – “satisficing”
Intuition
Previous Experience, Gut-Level Feeling”, Accumulated Judgment
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
Decision-making conditions, styles and errors
Conditions of decision-making
Certainty
A manager can make accurate decisions because the outcome of every alternative is known
Risk
A manager can estimate the likelihood of
certain outcomes
Uncertainty
A manager has neither certainty nor reasonable probability estimates
Decision-making styles
Linear
Preference for using external data
and facts
Process information through rational, logical thinking
Non-linear
Preference for internal sources of
information
Process information through internal insights, feelings, and hunches