This chapter’s objectives are to: Describe the seven steps of the decision making process, identify problems by analyzing causes and effects, describe how managers generate alternatives, predict possible consequences of alternatives, demonstrate how managers select the most desirable alternative.
Trang 1SECOND EDITION
Chapter 7 Making Better
Decisions
Trang 2Learning Objectives
Trang 3§ Types of decisions (p. 171)
• Programmed decision – based on preestablished rules in response to a recurring situation (p. 172)
• Nonprogrammed decision – based on reason and/or
intuition in response to a unique situation that requires a
tailored decision
• Classical model – normative model that leads to an optimal decision, assuming full availability of information,
sufficient time, and rationality of the decision maker
§ Optimal decision – best possible decision given all the needed information
Decisions That Make a Difference (p. 170)
Trang 4§ Classical model
Decisions That Make a Difference (cont.)
Figure 7.2
Trang 5§ Seven steps to better decision making (p. 173)
Decisions That Make a Difference (cont.)
Figure 7.3
Trang 7§ Ambiguity (p. 174)
• Information about the situation, goals, or criteria
that is incomplete or can be interpreted in multiple ways
• Observable behaviors related to underlying causal variables
§ Are noticed due to their symptomatic effects
Identifying and Understanding the Problem (p. 173)
Trang 8§ Underlying causes (p. 175)
• Behaviors that lead to a desired or undesired symptomatic effect
§ Intermediate causes – plausible and easily found
§ Root causes
• Revealed by:
§ Systemicbased analysis – takes into account the array of all known variables associated with a problem and its symptoms, including behavior over time
§ Policybased analysis – isolates the variables in a system that can truly be addressed through management innovation (p. 177)
Identifying and Understanding the Problem (cont.)
Trang 9§ Systems archetype of causal variables for
customer satisfaction
Identifying and Understanding the Problem (cont.)
Figure 7.6
Trang 10Identifying and Understanding the
Problem (cont.)
Figure 7.7
Trang 11§ Policybased analysis (p. 178)
• Following a systemicbased analysis, can examine specific policies that could be contributing to undesirable effects
with stockandflow diagrams
Identifying and Understanding the Problem (cont.)
Trang 12§ Front desk manager’s “guest expectation gap” explanation
Identifying and Understanding the Problem (cont.)
Figure 7.8
Trang 13§ Dolphin Resort: Annualized revenue and profit
Identifying and Understanding the Problem (cont.)
Figure 7.9
Trang 14§ Dolphin Resort revenue per available room
Identifying and Understanding the Problem (cont.)
Figure 7.10
Trang 15§ Dolphin Resort: Annualized room rate
Identifying and Understanding the Problem (cont.)
Figure 7.11
Trang 16§ Dolphin Resort: Annualized occupancy
percentage
Identifying and Understanding the Problem (cont.)
Figure 7.12
Trang 17§ Dolphin Resort: Guest expectation variables
Identifying and Understanding the Problem (cont.)
Figure 7.13
Trang 20§ Expectation gap between price and drifting
goals
Generating Alternatives (cont.)
Figure 7.15
Trang 21§ Brainstorming (p. 183)
• Creating as many alternatives as possible, without making value judgments about any idea
Generating Alternatives (cont.)
Figure 7.16
Trang 23§ Priorhypothesis bias (p. 186)
• Basing decisions on beliefs or assumptions despite evidence to the contrary
Trang 24Path Selection (p. 186)
Trang 25§ Reasoned judgment (p. 187)
• Decision based on extensive information gathering, careful analysis, and generation of alternatives
• Recognizes the limits of information, time, and individuals and seeks a satisfying rather than an optimum solution
Trang 26§ Successful implementation involves
connecting strategy, people, and operations
• Overestimating one’s ability to control evens and activities
Implementation (p. 188)