Decision making

1. What is organizational decision-making? How are programmed versus non-

programmed decision-making different? Give an example that is different from the book.
rganizational decision-making is the process of responding to a problem b! searching
for and selecting a solution or course of action that will create the most value for
organizational stakeholders. " difference between programmed and non-programmed
decision making is how the decision making occurs. With programmed decision making
involving selecting the most effective-eas!# repetitive# and routine- operating procedures
to handle an organizations ongoing value activities. $on-programmed involves striving to
create and implement the to adapt to changing and uncertain conditions. With no rules#
routines can be developed to handle these problems in advance cause the! are uni%ue or
unexpected. &olutions must be found after problems have arisen
'(he network below shows the management hierarch! of a division in a ma)or
cooperation. *ach node designates an emplo!ee in the organization. $odes are labeled b!
the person+s position and color-coded b! their organizational level. (he black links
designate formal reporting relationships.' www.orgnet.com/decisions.html
(his graphical representation shows how the decision making process is conducted in a
large cooperation and who has the most authorit! within the decision making process# the
general manager being the center of the organization and the one with the most power
feeding out to other line managers and emplo!ees.
,. What is the difference between the rational model and the -arnegie model of decision-
making? Wh! is this important to !ou as a manager?
" difference between .ational and the -arnegie model of decision-making is when its
time to make a decision how much information goes into the process. (he .ational
decision makes a choice based on what is best for the organization# using a lot of
information gathered from ever!one. (he -arnegie model with suggest choosing an
option that is most satisfactor! for the organization# with limited information searches to
identif! problems and alternative solutions.
(o elaborate more# for the rational model# decision making is a straightforward three-
stage process. "t stage 1# managers identif! problems that need to be solved. "t stage ,#
managers seek to design and develop a series of alternative courses of action to solve the
problems the! have identified. /inall!# at stage 0# managers compare the likel!
conse%uences of each alternative and decide which course of action offers the best
solution to the problem the! identified in stage 1.
(he -arnegie model recognizes the effects of 1satisficing#2 bounded rationalit!# and
organizational coalitions. (he information is limited# the solution is chosen b!
compromise# bargaining# and accommodations between organizational coalitions# and the
solution chosen is satisfactor! for the organization. 3resource class textbook pages 004#
005 and 0067
0. *xplain what organizational learning is and wh! it is important. How do the levels of
organizational learning impact the firm?
(his is the process where managers tr! to improve the members of the organization
willingness and abilit! to comprehend and manage the organization and its environment
and to make decisions continuousl! raising organizational effectiveness. 8t is important
for emplo!ees to know how to anal!ze how the organization performs and b! doing this
it improves production throughout the entire compan!. (he individual level of learning
emplo!ees maximize their skills which encourages them to be more responsible for their
decisions. (he group level learning encourages different groups in the organization to
learn from each other. (hese groups help to promote organizational learning.
rganizational level learning helps to create the organizations culture and norms.
"daptive cultures promotes new ideas# and rewards risk taking.
8nterorganizational level learning helps a compan! improve their effectiveness b!
learning from their suppliers about new wa!s to handle business.
Resource: textbook pages 341-349
4. "s a manager how would !ou handle knowledge management? Wh! is this important?
"s a manager 8 would handle knowledge management with importance using the
personalization approach. (his wa! there are people in place where other emplo!ees can
go to for help and find solutions to problems. (hink it is important to have that
opportunit! to have s!nerg! and communication between departments of an organization
so knowledge management can help create that -ompanies like H9# -hevron# and (exas
8nstruments like the book mentioned do better using the knowledge management and
spend mone! to maintain these s!stems.
5. *xplain 0 factors that impact organizational learning and how the! can be managed.
-ognitive structure: (he s!stem of interrelated beliefs# preferences# expectations# and
values a person uses to define problems and events.
-ognitive biases: /actors that s!stematicall! bias cognitive structures and affect
organizational learning and decision making.
-ognitive dissonance: (he state of discomfort or anxiet! a person feels when there is an
inconsistenc! between his or her beliefs and actions.
rganizations can use several means to overcome the effect of cognitive biases and
promote learning and change: implement strategies for organizational learning# increase
the breadth and diversit! of the top-management team# use devil+s advocac! and
dialectical in%uir!# use game theor!# and develop a collateral organizational structure.
.esource: rganizational (heor!# ;esign# and -hange# Gareth .. <ones# &ix edition. 9age
04=# 05,.
6. What is game theor!? How is this important to !ou as a manager?
1Game theor! is the stud! of the wa!s in which strategic interactions among economic
agents produce outcomes with respect to the preferences 3or utilities7 of those agents#
where the outcomes in %uestion might have been intended b! none of the agents2
3http:>>plato.stanford.edu>entries>game-theor!>7. 8t is important to me as a manager
because it can improve decision making and enhance learning# leading to overall better
strategic planning. ?anagers need to anticipate how their rivals will respond to whatever
might be their completive moves. (he! also need to reason backward so the! can
anticipate which opportunities the! should pursue based on what the! think their
competitors would react.
@. *xplain the role of a devils advocate and dialectic in%uir! in running an organization.
8n an organization the role of the person willing to be a devil+s advocate is to stand up and
identif! and challenge the flaws in an assessment# plan# or strateg! of more powerful
people. ther roles are to resist influence attempts and to work to convince other
emplo!ees or other stakeholders that the implication of new plans and>or ideas ma! be
flawed# wrong# and harmful to the organization.
3http:>>www.businessdictionar!.com>definition>devil-s-advocate.html7 (his and a related
techni%ue# dialectical in)ur!# are useful for overcoming cognitive biases and promoting
organizational learning. ;ialectic in)ur! is the formation of proposal and counter proposal
teams. 9roposal groups develop a plan# compiling a short list of assumptions underl!ing
in the plan. (hen this is given to the counter-proposal group who develop a counter-plan
that looks at all assumptions# breaking them down# to invent a possible counter-
assumption. (he! us these counter-assumptions to surface new data# re-interpret old data#
and devise a counter-plan. 3http:>>www.m!coted.com>;ialecticalA"pproaches7 -*ric
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