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WEEK 6: Managing Information & decision making (POLC information and…
WEEK 6: Managing Information & decision making
POLC information and decision making
decision making influenced by sources, quality and reliability of information base on Solid Data, - transfer to information - make decision
Nowadays, too much information = hard to choose which is best.
ability to engage in critical thinking, analysis and reflection determines how well one makes decision based on available information
the execution of the managerial functions of POLC result in decision making, often DAILY
JACK MA used Big Data, its associated analytics changing contemporary debates and arguments around decision-making
decision = more data driven. manager need to consider inclusiveness of data. in addition to the use of data for productive purposes
=> how best to execute POLC
=> Understanding information influence decision making
how do manager arrive at decisions?
METHOD
RATIONALLITY
ECONOMIC THEORY: individual consumers or citizens are economic are RATIONAL. ( max benefits for themselves)
describe choice = consistent & value maximising economic benefit for organisation
assumes:
the problem is clear and unambiguous
a single, well-defined goal is to be achieved
all alternative and consequences are known
preferences are clear
preferences are constant and stable
no time or cost constraints exist
final choice will maximise payoff
BOUNDED RATIONALITY
decision 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 have rationally
good enough decision SATISFICING
most use in organisation
INTUITION
Steve Job; if you are successful, you need to be able to trust the gut instincts of other people as well
product of - previous experience - "gut" level feeling - accumulated judgement
managerial problem and decisions
well structured problems - programmed decision = easy defined (eg: student apply for special consideration ) = handle by a routine approach ( produce - rule - policy)
unwell structured problems - non programmed decision = - new or unusual => non programmed = custom approach
group decision making
the value of collaborative decision making - Steve Job
if you are interested in hiring best ppl in the world, you have to listen to them
=> focus on the idea
advantages
more complete information & knowledge
more diverse alternatives
increase acceptance of solution
increase legitimacy
disadvantages
time consuming
minority domination
pressure to conform
ambiguous responsibility
condition - styles - errors
condition
certainty
a manager can make accurate decisions b/c the outcome of every alternative is known
uncertainty
a manager has neither certainty nor reasonable probability estimates
risk
a manager can estimate the likelihood of certain outcomes
styles
linear
: preference for using external data & facts / process information through rational, logical thinking
non - linear
preference for internal sources of information / process information through internal insights, feelings.
error - bias
- anchoring effects - framing - confirmation - sunk costs - randomness - representation - over confidence - immediate gratification - highsight - self serving