Decision Making and Change & Organizational Culture

Decision making

  • The process of choosing a course of action for dealing with a problem or opportunity.

Process

  1. Define problem: not too broad or narrow
  2. Analyze alternatives: determine exact information needed
  3. Make a choice: consider time, cost, impact, and ethics
  4. Take action; ensure that all affected parties have input
  5. Evaluate results: have desired outcomes been attained

Moral dilemma
A situation where the decision maker faces two or more ethically uncomfortable alternatives.

Erhical double checks

  • Criteria: utility, rights, justice, caring
  • spotlight questions

What are the alternative decision-making models?

Programmed decisions
Involve routine problems that arise regularly and can be addressed through standard responses.
Nonprogrammed decisions
Involve nonroutine problems that require solutions specifically tailored to the situation at hand.

1. classical theory

  • Classical decision theory assumes a manager:
    = Acts rationally and in a fully informed manner.
    = Faces a clearly defined problem.
    = Knows all possible action alternatives and their consequences.
    = Chooses the optimum solution.

2.Behavior decision theory

  • Suggests that people act only in terms of their perceptions, which are frequently imperfect.

3.The garbage can model

  • The main components of the choice process - problems, solutions, participants, and choice situations – are all mixed together in the “garbage can” of the organization.

Teams engage in two cognitive processes:
-Systematic(Problem approach utilizing a rational, analytic thinking)

  • Intuitive(A key element of decision making under risky and uncertainty conditions)

What are key decision-making traps and issues?

Judgmental heuristics

  • Simplifying strategies or shortcuts used to make decisions.
  • Make it easier to deal with uncertainty and limited information.

Availability heuristic

  • Involves assessing a current event based on past occurrences that are easily available in one’s memory.

Representativeness heuristic

  • Involves assessing the likelihood that an event will occur based on its similarity to one’s stereotypes of similar occurrences

Anchoring and adjustment heuristic

  • Bases a decision on incremental adjustments to an initial value determined

Consultative decisions

  • The manager or team leader solicits input from other people and then, based on this information and its interpretation, makes a final choice.

Team decisions

  • Manager or team leader consults with others and allows them to help make the final choice.

Organizational Culture

  • A system of shared values, assumptions, beliefs, and norms that unite the members of an organization.

Skills for managing organizational culture and change:

  • Cultural diagnostic skills
  • Cultural strategic skills
  • Managing culture skills
  • Change management skills

Levels of Corporate Culture

  • Core Values
  • Expressed Values
  • Visible Culture

Functions performed by organizational culture:

  • Employee Self-Management


    ✅ Sense of shared identity


    ✅ Generation of commitment


  • Stability


    ✅ Sense of continuity


    ✅ Satisfies the need for predictability, security, and comfort


  • Socialization


    ✅ Internalizing or taking organizational values


  • Implementation Support of the Organization’s Strategy


    ✅ If strategy and culture reinforce each other, employees find it natural to be committed to the strategy


Stages of the Socialization Process

  • pre-arrival
  • encounter
  • metamorphosis

creating and sustaining organizational culture

  • culture symbols
  • company rituals and ceremonies
  • company heroes
  • stories
  • language
  • leadership
  • organizational policies and decision making

resistance to change

  • self-interest
  • lack of tryst and understanding
  • uncertainty
  • cultures that value tradition
  • different perspectives and goals

implementing organizational change

  • bottom-up change
  • change agents
  • top-down change