Foundations of Management - Week 4: Decision Making
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What is decision making?
The process of generating and choosing from a set of alternatives to solve a problem.
What determines making accurate and sound decisions?
The more knowledge and skills employees possess
What is bounded rationality?
The notion that decision makers do not have the ability or resources to process all available information and alternatives to make an optimal decision.
What is satisficing?
When decision makers select the first acceptable alternative considered.
What is the availability heuristic?
Tendency to base decisions on information that is readily available in memory
What is the Representative heuristic?
Estimate the probability of an event occurring
What are common biases in decision making?
- Confirmation bias
- Anchoring bias
- Overconfidence bias
- Hindsight bias
- Framing bias
- Escalation of commitment bias
What is the hindsight bias?
A way of saying "I knew it all along".
What is the framing bias?
- Program A: If Program A is adopted, 200 people will be saved
- Program B: If Program B is adopted, there is a one-third probability that 600 people will be saved and a two-thirds probability that no people will be saved.
What are four decision making styles?
What are some group problem-solving techniques?
- The nominal group technique
- The Delphi technique
- Computer-Aided decision making
What is the nominal group technique?
Process to generate ideas and evaluate solutions
What is the Delphi technique?
Process to generate ideas from physically dispersed experts.
What would you like to do?
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