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decisions are errors in judgment that originate in the human mind’s limited capacity and in the
natural biases managers display during decision making. Awareness of the following six biases
can help managers make more enlightened choices:
• Being influenced by initial impressions. The mind often gives disproportionate weight to the
first information it receives when considering decisions. These initial impressions act as an
VI. INNOVATIVE DECISION MAKING
A. Start with Brainstorming
1. One of the best known techniques for rapidly generating creative alternatives is
brainstorming. Brainstorming uses a face-to-face group to spontaneously suggest a
2. Electronic brainstorming, called brainwriting, brings people together in an
interactive group over a computer network. Recent studies show that electronic
B. Use Hard Evidence
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1. Using evidence can help take emotion out of decision-making process, preventing
managers relying on faulty assumptions or point of view.
C. Engage in Rigorous Debate
An important key to better decision making under conditions of uncertainty is to
encourage a rigorous debate of the issue at hand. Good managers recognize that
constructive conflict based on different points of view can focus a problem, clarify ideas,
and stimulate creative thinking. It can also create a broader understanding of issues and
alternatives, and improve broader decision quality. There are several ways to stimulate
rigorous debate.
a. One way is by ensuring diversity in terms of age and gender, functional area of
expertise, hierarchical level, and experience with the business.
D. Avoid Groupthink
Avoiding groupthink helps groups make better decisions. Groupthink refers to the
tendency of people in groups to suppress contrary opinions. When people slip into
alternatives. Some disagreement and conflict is much healthier than blind agreement.
E. Know When to Bail
In a fast-paced environment, good manager encourages risk taking and learning from
mistakes, it also teaches a person to know when to pull the plug on something that isn’t
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F. Do a Postmortem
To improve decision making, managers need to reflect and learn from every decision they
make.
1. A technique many companies have adopted from the U.S. Army to encourage
examination of the evidence and continuous learning is the after-action review, a
2. A similar technique was applied by managers at Lenovo called fu pan, which means
Answers To End Of Chapter Discussion Questions
1. You are a busy partner in a legal firm and an experienced administrative assistant complains
of continued headaches, drowsiness, dry throat, and occasional spells of fatigue and flu. She
tells you she believes that the air quality in the building is bad and would like something to
be done. How would you respond?
Students should apply the decision-making steps to solve this problem. The first step is
recognition of decision requirement. The manager must determine if there truly is a problem
2. Managers at Gap Inc., a once- popular retail chain, are reported to have made a series of
decisions that hurt the company: they expanded so rapidly that the chain lost touch with
customers; they tried to copy the successful approach of rivals rather than charting their own
course; they cut quality to reduce costs; they shifted from one fashion approach to another as
each failed to appeal to customers, and so on. What techniques would you recommend Gap
managers use to improve the quality of their decisions?
Decision making is especially important to effectiveness because it underlies all manager
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3. Explain the difference between risk and ambiguity. How might decision making differ for a
risky versus an ambiguous situation?
Risk means that the decision maker has most of the necessary information. The objectives of
the decision are clear-cut, and alternatives can be identified. However, the future outcome of
each alternative is not known for certain, although the probability of outcomes can be
4. Analyze three decisions you made over the past six months. Which of these were
programmed and which were nonprogrammed? Which model—the classical, administrative,
or political—best describes the approach you took to making each decision?
A programmed decision would refer to a situation that has occurred often enough so that a
student can use past experience and similar decision rules over and over again. Programmed
car. A nonprogrammed decision could be the choice of a major field of study, a decision that
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5. What opportunities and potential problems are posed by the formation of more than one
coalition within an organization, each one advocating a different direction or alternatives?
What steps can you take as a manager to make sure that dueling coalitions result in
constructive discussion rather than dissension?
When more than one coalition forms within an organization, with each advocating a different
direction or alternative, there are significant opportunities for constructive dialogue and
enhanced decision making, but only if the coalitions are able to come together and work
6. Can you think of a bad decision from your own school or work experience or from the recent
business or political news that was made in an effort to correct or justify a past decision? As
a new manager, how might you resist the urge to choose a decision alternative based on the
idea that it might correct or validate a previous decision?
Students’ descriptions of past bad decisions will obviously vary. As new managers, it will be
important for them to avoid making decisions based on the idea that they might correct or
7. Experts advise that most catastrophes in organizations result from a series of small problems
or mistakes. As a new, entry-level manager, how might you apply this understanding to help
your organization avoid making major mistakes?
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Finding ways to compensate for inexperience in decision making is critical to identifying the
alternative most likely to succeed. A new, entry-level manager who fails to do so will soon
8. List some possible advantages and disadvantages to using computer technology for
managerial decision making.
Advantages of using computers in making managerial decisions would be increased
9. Can intuition and evidence-based decision making coexist as valid approaches within an
organization? How might managers combine their intuition with a rational, data-driven,
evidence-based approach?
Intuition or a “gut” feeling, especially where it is forthcoming from experience, can be useful
in management decision making. When time is of the essence, intuition can be a valid
10. What do you think is your dominant decision style? Is your style compatible with group
techniques such as brainstorming and engaging in rigorous debate? Discuss.
Students’ responses will, of course, be very different. They should, however, demonstrate an
The directive style is used by people who prefer simple, clear-cut solutions to problems.
Managers who use this style often make decisions quickly because they do not like to deal
with a lot of information and may consider only one or two alternatives. People who prefer
the directive style generally are efficient and rational and prefer to rely on existing rules or
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procedures for making decisions. These students may be more comfortable with jobs in
which the work is fairly regimented and where most decisions will be programmed decisions.
People who tend toward a conceptual style also like to consider a broad amount of
information. However, they are more socially oriented than those with an analytical style and
like to talk to others about the problem and possible alternatives for solving it. Managers
using a conceptual style consider many broad alternatives, rely on information from both
people and systems, and like to solve problems creatively. These students may be more
comfortable in jobs that involve many nonprogrammed decisions that require strong
conceptual skills.
Apply Your Skills: Experiential Exercise
What’s Your Personal Decision Style?
Student responses will vary regarding their own decision-making style. For additional
information, one is encouraged to review decision-making styles in the chapter. Personal
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People who tend toward a conceptual style also like to consider a broad amount of information.
However, they are more socially oriented than those with an analytical style and like to talk to
The behavioral style is often the style adopted by managers having a deep concern for others as
Apply Your Skills: Small Group Breakout
A New Approach to Making Decisions
Managers are typically effective at focusing on problems and diagnosing what is wrong and how
to fix it when they have to make a decision. A new approach to decision making known as
Apply Your Skills: Ethical Dilemma
The No-Show Consultant
1. Give Carpenter a month’s notice and terminate. He’s known as a good consultant, so he
probably won’t have any trouble finding a new job, and you’ll avoid any further problems
associated with his emotional difficulties and his possible alcohol problem.
Option 1 is not the course of action to take. Alcoholism is not an uncommon disease, and it
2. Let it slide. Missing the New York appointment is Carpenter’s first big mistake. He says he
is getting things under control, and you believe that he should be given a chance to get
himself back on track.
Option 2 is not desirable. Care must be taken and concerns expressed to Andrew. He is
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3. Let Carpenter know that you care about what he’s going through, but insist that he take a
short paid leave and get counseling to deal with his emotional difficulties and evaluate the
seriousness of his problems with alcohol. If the alcohol abuse continues, require him to
attend a treatment program or find another job.
Apply Your Skills: Case for Critical Analysis
The Office
1. What mistakes do you think John Mitchell made with the way he solved the problem of
limited office space? Explain.
It seems obvious that John Mitchell settled for a satisficing rather than a maximizing solution for
the problem. His approach to decision making is based on the administrative model, which is
2. What approach would you have used if you were Mitchell? Why?
The classical model of decision making would have been a better approach for Mitchell. This
model is considered to be normative, which means it defines how a decision maker should make
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3. What are Krista Acklen’s options for responding to Mitchell’s decision? What should she do
now? Why?
Following are the possible ways in which Krista Acklen can respond to Mitchell’s decision:
a. Start with brainstorming
b. Use hard evidence
On the Job Video Case Answers
Plant Fantasies
1. Did Plant Fantasies owner Teresa Carleo follow the rational decision-making process to
launch Plant Fantasies? Explain.
According to Carleo, the decision to quit her old job and start Plant Fantasies was characterized
by whim and emotion. Her process was not consistent with the rational decision making model.
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2. List an example of a programmed decision at Plant Fantasies. Identify a nonprogrammed
decision at Plant Fantasies.
A programmed decision is a decision made in any situation that has occurred often enough to
enable decision rules to be developed and applied in the future. Programmed decisions tend to
3. How might managers at Plant Fantasies conduct the final evaluation stage of the decision-
making process when installing a new garden for a client?
Answers will vary, but maintenance teams can observe and track their progress during