1. Chapter 10 Decision Making

2. Learning Outcomes: Decision Making
Explain the satisficing model for decision making.
Describe the workings of the implicit favorite model for decision making.
Outline the maximizing or rational decision making model.
Discuss the various group decision techniques.

3. Decision-Making
The key to making a decision is to understand the problem.
Decision making would best be described as an exercise in evaluating trade-offs.

4. Determining the need for a decision1
Situations in Life 2
Problems 3
Priority Problem 4
Causes for Problem
Make A
Decision
Most Likely Cause 5 6
Alternatives
Determining the need for a decision

5. Decision-Making Understanding the problem
Problem-solving and decision-making technique
Analyze the facts
Determining a course of action

6. Three Models for Decision-Making
Satisficing Model
Implicit Favorite Model
Maximizing or Rational Decision-Making Model

7. The Satisficing Model Problem identified Identify alternatives Problem
simplified
Satisficing
criteria set
Compare
alternatives
one at a time
against criteria
Select first
alternative
that meets
criteria and
is considered
“good enough”
Does alternative
meet satisficing
Criteria?
YES NO
Expand on
alternatives

8. The Implicit Favorite Model
Select an
implicit
favorite
alternative
Establish
criteria to
match implicit
favorite 4
Select
implicit
favorite
Confirm
implicit
favorite 5
Need for a
decision is
determined 2 1 3
Compare
alternatives with
implicit favorite
criteria
Identify
other
alternatives

9. Six Steps to the Rational/Maximizing Decision-Making Model
Identify the need for a decision
Identify the decision criteria
Allocate weights to the criteria
Develop the alternatives
Evaluate the alternatives
Select the best alternative

10. Determining a Course of Action
There are five basic types of action that can be taken in problem-solving and decision-making:
corrective action
interim action
preventive action
contingency action
adaptive action
Which one
is the best?

11. Who makes the decision? The manager makes the decision.
The manager sells the decision.
The manager presents the ideas and invites questions.
The manager presents tentative decisions subject to change.

12. Who makes the decision?
The manager presents the problem, gets suggestions, and makes the decision
The manager defines the limits an asks the group to make the decision
The manager permits the subordinates to function within the limits defined by the superior.

13. Decision-Making Other issues to consider are: quality issues
time and timing
commitment
control

14. Group Decision-Making
Interacting technique
Brainstorming
Nominal group technique
Delphi technique
Electronic meetings

15. Summary
There are many ways to make decisions and solve problems. This chapter looks at several of the more common ways available to the leader.
The implicit favorite model will serve one well if he or she already knows what he or she wants to do.
The satisficing model works well if time is a consideration and one only needs to determine the criteria and then selects the first solution that meets the criteria.

16. Summary
The maximizing decision-making model provides a means to prioritize and understand the problem, analyze the facts, and then determine a course of action.
There are five basic types of action that can be taken in problem-solving and decision-making: corrective action, interim action, preventive action, contingency action, and adaptive action.