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MANAGING & [DECISION-MAKING] - Coggle Diagram
MANAGING & [DECISION-MAKING]
structured problems and programmed decisions
procedure
rule
policy
Rationality
No time or cost constraints exists
Preferences are clear and stable
Problem is clear and unambiguous
Managerial decision making is assumed to be rational
A rational decision maker would be fully objective and logical
Making decisions rationally increases chances of the goal being achieved
Assumes that
:
Intuition
Gut feeling
Sometimes relies on subconscious
useful for deciding between two good solutions
Previous experience
new business starters find it difficult to rely on intuition
shows "innovation"
sets a new business apart from the crowd
Accumulated judgement
requires no data, but can still be useful as we learn from our mistakes
data is often rejected, decisions may be skewed, biased
Un-structured problems and non-programmed decisions
unique
non recurring
Tailored solution
decision making conditions
risk
Estimate the likelihood of Certain outcomes, based on personal experiences or secondary information
uncertainty
No certainty and no reasonable probability estimates
certainty
Outcome of every alternative is known
No contingency thinking
More idealistic, less realistic
Bounded Rationality
decisions are made within the parameters or constraints of the business
still underlay by rationality
influences of goals, politics and power structures
leads to escalation
commitment to a previous decision even though you know it is likely a wrong one.
"Satisficing"
good enough
on the spot
efficient
decision making styles
linear
external data and facts used
rational, logical thinking
non-linear
preference for internal sources of information
insights, feelings and hunches