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CHAPTER 3 : DECISION MAKING (Seven steps in Decision-Making Process…
CHAPTER 3 : DECISION MAKING
Definition
The process through which managers and leaders identify and resolve problems and capitalize on opportunities.
Types of decision making
Programmed
Nonprogrammed
Seven steps in Decision-Making Process
Evaluating alternatives
Reaching decisions
Generating alternatives
Choosing implementation strategies
Identifying objectives
Monitoring and evaluating
Identifying opportunities and diagnosing problems
Models of Decision Making
Rational-Economic Model
This model assumes that people will make choices that maximize benefits and minimize any costs
A prescriptive framework of how a decision should be made that assumes managers have completely accurate information
Concentrates on how decision should be made, not on how they are actually made.
Behavioral Decision Model
Acknowledge human limitations that make rational decisions difficult to achieve.
Suggests that a person's cognitive ability to process information is limited
Techniques for Quality in Group Decision Making
Nominal Group Technique
Delphi Technique
Brainstorming