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WEEK 6: Managing information and decision-making (Decision-making…
WEEK 6: Managing information and decision-making
POLC, information and decision-making
Managing 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 decision based in available information
The execution of the managerial functions of POLC results in decision-making, often daily
Big data and its associated analytics changing contemporary debate s and arguments around decision making
As organisation decisions increasingly become more data consider inclusiveness of data in addition to the use of data for productive purpose
How do managers arrive at decisions
RATIONALITY: describes the choices that are inconsistent and value maximising
BOUNDED RATIONALITY: decisions made within the parameters of a simplified model that captures the essential features of a problem; bounded by constraints, limitations
INTUITION: previous experience, gut level feeling, accumulated judgment
Managerial problems and decisions
Well structured problems & programmed decisions
-structured problems are easy to defined
-programmed decisions are those handled by a routine approach
Procedure rule policy
Un-structured problems & non-programmed decisions
Un-structured problems are always those new or unusual in normal life
Non-programmed decisions need a custom approach, always ends up with a unique solution for a certain problem
A tailored solution for a unique and non recurring problem
Group decision-making
Advantages of group decision making
More complete information and knowledge
More diverse alternatives
Increases acceptance of a solution
Increases legitimacy
Disadvantages
Time consuming as more people mean greater input of ideas
Minority
Pressure to conform
Ambiguous responsibility - who is actually responsible?
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
Common decision-making errors and biases
