1
McKee Chapter 6:
THE HUMAN SIDE OF PLANNING: DECISION
MAKING AND CRITICAL THINKING
CHAPTER OBJECTIVES
6.1 Define decision making.
6.2 Compare and contrast how cognitive and emotional processes affect decision making.
CHAPTER SUMMARY
Any plan is only as good as the skills and competencies of the planner(s). Chapter
6 addresses the human side of planning: decision making and critical thinking; both
essential skills for effective management and leadership.
The chapter begins by defining decision making and the process involved. From
there we move to exploring the different types of decisions, programmed and non-
programmed.
Next, we examine how cognitive and emotional processes affect decision making.
These processes include emotion, intuition, logic (or lack thereof), and perception and the
The next section focuses on a common decision making model, with its eight
steps, that can be used to make decisions in life and at work. The chapter addresses
research about what to do when information is incomplete (which is most of the time),
and the role that bounded rationality and the 80/20 Rule serve in decision making.
2
brainstorming, and the Delphi Technique are explored. Finally, the chapter concludes
with exploring what can we all do to improve critical thinking and decision making.
Practicing mindfulness and double-loop learning are discussed here.
CHAPTER OUTLINE
Teaching Objective: To increase awareness of the mission critical importance of
effective decision making and critical thinking in the planning process.
I. What is decision making?
A. Decision making defined – a cognitive, emotional, and neuropsychological
process that involves thoughts, feelings, and neurological functioning and
results in making a choice from alternatives
1. collecting information related to the problem
B. Types of Decisions – decisions can be classified depending on how often and
how easily they are made
1. programmed decisions – decisions that are routine in nature and that
involve unique information or circumstances.
II. How Do Cognitive and Emotional Processes Affect Decision Making?
A. Reason and Logic in Decision Making – Reasoning is a “psycho–logic”
B. Cognitive Processing: Perceptions Impact How We Understand
Information – effective decision making is contingent upon how well people
understand and manage their own thought processes
1. Schemas – conceptual maps in our minds that allow us to understand and
mentally categorize information as we receive it
2. Stereotypes – oversimplified ideas or beliefs that are particularly rigid and
difficult to change
c. Halo effect – when we judge something or someone more positively
based on a previous positive experience or association with someone or
3
something we admire
III. How Can You Apply a Systematic Approach to Making Decisions?
A. decision-making process – the steps taken by individuals or groups when
they choose a course of action
B. Eight step model for effective decision making – eight sequential steps for
rationally identifying a problem and then choosing and implementing a
specific alternative
1. Identify the problem
2. Establish the decision criteria
IV. How Can People Make Good Decisions with Incomplete Information?
A. Bounded rationality – an approach to decision making that accepts that all
decisions are made under conditions of constraints that limit rationality such
as:
1. Completeness and accuracy of information
B. The 80/20 rule – a rule-of-thumb to quickly see possible causal relationships,
V. How Can You Improve Your Critical Thinking Skills and Make Better Decisions?
A. Critical thinking – the disciplined intellectual process of evaluating
situations or ideas and making appropriate judgments or taking certain actions
4
C. Critical Thinking Errors
1. Jumping too quickly to a conclusion
D. Thinking Traps – well known errors that can compromise critical thinking
and decision making
1. Status quo – favoring decisions that perpetuate the current situation
2. Sunk costs – making choices that justify flawed past decisions
VI. What Can HR Do to Support Critical Thinking and Decision Making?
A. Brainstorming – the process of generating a list of ideas among a group
VII. What Can You Do to Improve Critical Thinking and Decision Making?
A. Mindfulness – enables us to be more fully aware of all that is happening
B. Single-Loop Learning – a process that results in taking in feedback and
changing behavior, but not changing underlying beliefs about one’s self,
DISCUSSION QUESTIONS
Discussion Questions for Objective 6.1:
1. Why, in your opinion, does decision making include thoughts and feelings? Name
some ways that feelings can help effective decision making. Name some ways that
feelings can hinder effective decision making.
Suggested Answer:
Student responses will vary. First, our thoughts are tied, whether consciously or
5
2. Identify three nonprogrammed decisions that you need to make this year. Describe
what is unique about each of these decisions. What information will you need in order to
make these choices?
Suggested Answer:
Discussion Questions for Objective 6.2:
1. Describe a moment when you had an incredible insight at school or at work. How did
you react emotionally? What logical process did you employ to explain the new
information? Was this insight intuition? Explain.
Suggested Answer:
2. In this section, we noted that taking in new information can require accommodation—
that is, adapting your cognitive filing system to include new ways of understanding
people and situations. Have you ever consciously done this? What was the situation? Was
this easy or hard for you? How did accommodation help you?
Suggested Answer:
Student responses will vary. It is common to experience accommodation when dealing
Discussion Questions for Objective 6.3:
1. Apply the eight-step process discussed in this section to a decision you are currently
grappling with. Now, ask yourself some tough questions: Are you being realistic and
honest with yourself about the decision criteria, the weights you assigned to them, and
even your alternatives? Are you “too close” to the problem to decide on an effective
course of action? Why? What can you do to change that?
Suggested Answer:
Student responses will vary.
6
2. Do you evaluate your big decisions regularly? How? Name a few reasons that might
cause you to reevaluate one of these big decisions.
Suggested Answer:
Student responses will vary. You should evaluate your big decisions fairly regularly. If
Discussion Questions for Objective 6.4:
1. Use the concept of bounded rationality to explain how you made the decision to choose
your major.
Suggested Answer:
Student responses will vary. Once we are faced with making a decision, we need to
limitations and approaches of the people involved.
2. Do you believe the 80/20 rule is a useful model for attempting to understand
organizational strengths and weaknesses? Why or why not? Give one example in which
the model would be helpful and one in which it could result in a bad decision.
Suggested Answer:
Student responses will vary. In general, it serves as a useful guide. One example in which
7
Discussion Questions for Objective 6.5:
1. Consider three common critical thinking errors mentioned in this section. Reflect on an
example of each error from your own experiences. Based on these outcomes, what could
you have done better?
Suggested Answer:
Student responses will vary.
Critical Thinking Errors
1. Jumping too quickly to a conclusion
2. Review Exhibit 6.8 about “thinking traps.” Consider a decision you need to make in
the near future, and imagine what would happen if you fell into one of the thinking traps.
Now, review the avoidance strategies and apply a few to your reflection about the
decision.
Suggested Answer:
Student responses will vary. Suppose you are faced with having to buy a new car in the
near future. You are convinced that a particular brand is superior over your other
Discussion Questions for Objective 6.6:
1. Consider a problem you are facing. Brainstorm reasons for the problem. Now
brainstorm solutions. How does brainstorming reasons before solutions impact your
choices?
Suggested Answer:
2. Think of an example that you have participated in, seen, or read about in which
brainstorming or the Delphi technique was used to solve a problem. What were the
benefits to using the approach? Under what situations would you not use these
techniques?
8
Suggested Answer:
Discussion Questions for Objective 6.7:
1. Do you have a daily practice that allows you to reflect, calm down, and become more
mindful? Brainstorm several other things you can do to foster mindfulness.
Suggested Answer:
2. Consider a situation where you believe you made a bad decision. Did you apply single
loop or double-loop learning to the situation? How could you have changed your
approach to make a better decision?
Suggested Answer:
Student responses will vary. Single-loop learning occurs when we take in feedback,
END OF CHAPTER ACTIVITIES: EXPERIENCING LEADERSHIP
Leading in a Global World: Logical Celebrations
As we have already seen, reason and emotions are an integral part of decision making.
Cognitive processing— or the way we understand and acquire information—is also
important to this process. But where does culture fit into the equation? For example, do
people in Asian countries use the same logic when making a decision as people in Europe
or the United States? What influence do religious differences have over a person’s ethical
approach to solving a problem?
Imagine you are a manager of a very diverse, multicultural team and describe the team in
1. List all possible holidays.
2. Think of the issues you may encounter in making this decision.
3. Create a guide for facilitating the discussion so the decision will be made to the
satisfaction of all or most people.
Suggested Answer:
Leading with Emotional Intelligence: The Joys of the Open Road
A decision-making process uses systematic steps to determine a course of action. The
size and complexity of a problem determine how much time and effort
go into the process. However, no matter how analytical or systematic the process may be,
it also includes a profound emotional component that needs to be acknowledged. Think
back to a first and important adult decision- -maybe purchasing your first car. It was an
exciting purchase that came with a great deal of responsibility and a great deal of
freedom. There were probably many different emotions involved in your experience.
Maybe you envisioned the places you’d go and the things you’d see on your own or with
your friends. You may have even been a little fearful about the debt you were taking on
or impatient with the car sales people.
1. Review the eight-step decision-making model. For each step, identify the emotion (or
2. Once you have identified the emotion, try to analyze the source of that emotion. For
example, why were you frustrated over the choice between a Ford Mustang and a Toyota
Prius? Identify at least one emotion and its source for all eight steps.
Suggested Answer:
Student responses will vary.
10
Leading with Critical Thinking Skills — Thinking Traps
The great nineteenth century psychologist and spiritual philosopher William James
observed, “A great many people think they are thinking when they are merely rearranging
their prejudices.” Unfortunately, this is true in many instances of decision making and
problem solving.
The quality of your decision making depends on your ability to evaluate ideas and
situations and make informed, appropriate judgments. In this way, critical thinking is a
thinking skills to analyze and assess the writers’ viewpoint. In addition, pay attention to
any of the traps you may fall into in regards to your personal political leanings. As you do
this exercise, keep in mind William James’ observation and mindfully attend to whether
you are rearranging your prejudices or thinking critically.
Suggested Answer:
Student responses will vary.
11
Ethical Leadership: To Cheat, or Not to Cheat?
In management, ethical dilemmas are common. In these situations, good managers rely
on their values and the company’s code of ethics in order to decide what is best, fair, and
honest. Read the following scenario and respond using your sense of right and wrong as a
guide.
Your best friend has gotten the answers to your management midterm exam from
Write a thoughtful response to this situation that reflects on the following questions:
1. What are all the consequences of your decision, both negative and positive?
2. How are your emotions, such as fear or gratitude, influencing your decision to use the
cheat sheet?
3. Are there just two choices to make here, or are there others you haven’t considered?
Suggested Answer:
Student responses will vary. Even if you do not get caught and think that short-term
consequences were positive (better grade), long-term consequences are quite negative
12
ADDITIONAL SUPPORTING MATERIALS
VIDEOS
• George Whitesides – Toward a science of simplicity
”Simplicity: We know it when we see it — but what is it, exactly? In this funny,
• Barry Schwartz on the paradox of choice
“Psychologist Barry Schwartz takes aim at a central tenet of western societies: freedom
of choice. In Schwartz’s estimation, choice has made us not freer but more paralyzed, not
• Shaffi Mather: A new way to fight corruption
“Shaffi Mather explains why he left his first career to become a social entrepreneur,
providing life-saving transportation with his company 1298 for Ambulance. Now, he has
a new idea and plans to begin a company to fight the booming business of corruption in
Janine Benyus: Biomimicry in action
”Janine Benyus has a message for inventors: When solving a design problem, look to
nature first. There you’ll find inspired designs for making things waterproof,
Paul Romer’s radical idea: Charter cities
“How can a struggling country break out of poverty if it’s trapped in a system of bad
rules? Economist Paul Romer unveils a bold idea: “charter cities,” city-scale
administrative zones governed by a coalition of nations. (Could Guantánamo Bay become
• The WTO’s decision making process
13
“Gaining consensus among 153 countries on 20 complex topics is an immense
undertaking. Recent setbacks in the Doha negotiations have led some commentators to
suggest that the WTO’s system of decision making needs to be changed. Is the practice of
deciding by consensus and principle of a single undertaking in which all issues must be
agreed before any can be agreed, outdated? Or does a result with the expressed support of
INDIVIDUAL EXERCISES
1. Of course, the mission of any university is to provide the best possible education to its
students using the best resources at its disposal. In order to achieve this goal, a
2. Ask students to think of their school as a business, since it is. Break them into groups
of 3-5 and ask them to do a SWOT analysis of their school. Have them make a list of
3. Nearly all business students in any national university have worked on team projects
in order to prepare them for the real world of business. Have students reflect on their
4. Divide students into teams of 3-4 people. Each team is given the same list of people
below. Each team is to select and agree on 7 of the 10 people listed with whom they
would be stranded on a remote island in the Pacific. Each group has to provide their
justification for the 7 people they selected to take, as well as the 3 people left behind.
5. Debrief the exercise by asking the following questions: How did you start your list –
6. Tell students that their husband/wife has been kidnapped by a dangerous gang who is
now asking for a ransom of $500,000.00. The money needs to be delivered in 2 days.
7. Divide students up into pairs. Ask them to think of a problem/choice they have to
make in the present or very near future. Ask them to write down their plan using the
TEAM EXERCISE
Lost at Sea
Decision making in a group environment is both common and not without its difficulties.
Give students 5 minutes to individually rank file in order of importance to survival the 15
Facilitate a discussion regarding individual scores as compared to team scores looking at
why the scores are different. Share the “answers” provided below from the US Coast
Guard and Navy. What changed their minds, how where they influenced etc. regarding
the ease/difficulty of making group decisions?
You and your team have chartered a yacht. On board are your small group and an
15
Your chances of survival will depend upon your ability to rank the following 15
items in their relative order of importance. Good luck!
1. A sextant
2. A shaving mirror
3. A quantity of mosquito netting
What The Experts Say:
According to the experts (US Coastguard), the basic supplies needed when a person is
stranded mid-ocean are articles to attract attention and articles to aid survival until rescue
arrives. Articles for navigation are of little importance since even if a small life raft were
capable of reaching land, it would be impossible to store enough food and water to
survive for the requisite amount of time.
Without signaling devices, there is almost no chance of being spotted and ultimately
rescued. Furthermore, most rescues occur within the first 36 hours and a person can
survive with only a minimum of food and water during that period.
So, the following is the order of ranking the items in their importance to your survival:
1. Shaving Mirror – Critical for signaling
16
7. Fishing kit – Ranked lower than
8. 15ft of nylon rope – Could be used to lash people or equipment together to prevent it
being washed overboard.
9. Floating seat cushion – A life preserver if someone fell overboard
10. Shark repellent – Enough said
ADDITIONAL RESEARCH
Critical Thinking
M. L. Emiliani describes critical thinking as an intellectual process used to examine, with
discipline, ideas, assumptions, reasoning, implications, and the validity of espoused
knowledge in order to determine their logic and consistency. Emiliani observes that
because critical thinking is a disciplined process of inquiry, it can result in a common
language and set of activities that “align key functional areas and stakeholders”.[i]
Decision Making Processes
‘Decision processes’ refers to the mechanisms, or heuristics, by which individuals or
groups make decisions. Decision processes depend on the type of problem, the
17
Bounded Rationality
James March addressed the issue of bounded rationality directly in a paper published in
1978[i]. His concern for the topic arose out of a student’s response to a lecture he had
recently given on elementary decision theory. The simple question the student asked was
what empirical evidence supported the assumption that human decisions were improved
by knowledge of decision theory or by the application of decision heuristics. In other
March begins by reviewing four categories of alternate rationalities: limited, contextual,
game, and process rationality. Limited rationality recognizes that there are costs
(cognitive, physical, or financial) to obtaining and processing information needed to
make rational decisions. A number of heuristics have been developed and proposed to
simplify both decision problems and information gathering in order to facilitate decisions
that are practical within these cost limitations. Contextual rationality recognizes that
choice behavior is embedded in a particular context of temporal, cognitive and social
A particular concern of March with regard to decision processes is that prescriptive
models of choice rely on the stability, consistency, and precision of subjective
preferences. In other words, what we like is often viewed as a constant rather than a
variable. But if anything, human preference, or taste, is anything but constant. Therefore,