MGT 305 1st Edition Exam 2 Study Guide Decision Making Model 1 2 3 4 5 6 7 8 Define the problem Identify decision criteria Weight the criteria Generate alternatives Rate each alternative on each criteria Select an alternative Implement alternative Evaluate decision Rational vs Bounded Rational Reaction Thinking is how when your emotions biases affect your decisions Intuitive Decision Making Making decisions on the basis of experience feelings and accumulated judgments Leadership styles Autocratic on your own with or without team information Consultative consult with others individually or as a team Collaborative Facilitative Work together to reach consensus Decision Making Styles Linear Thinking Style A person s tendency to use external data facts the habit of processing information through rational logical thinking Nonlinear Thinking Style A person s preference for internal sources of information a method of processing his information with internal insights feelings and hunches Types of Decisions Programmed Decisions A Repetitive decision that can be handled by a routine approach Procedure Policy Rule Non programmed Decisions Unique and nonrecurring decisions that require a custom made solution Group Think The tendency of members to lose critical evaluative capabilities when there are overly concerned with consensus with the rest of the group Planning Urgency Importance Matrix Covey Why plan Provides direction Reduces uncertainty Minimizes waste and redundancy Sets the standards for controlling Mission What do you stand for Defines present state purpose Action oriented Vision What do you ASPIRE to Defines optimal desired state Well designed goals Written in terms of outcomes not actions Measurable and quantifiable Clear as to time frame Challenging yet attainable Written down Communicated to all Steps in goal setting 1 Review the organization s or YOUR mission statement Do goals reflect the mission 1 Evaluate available resources Are resources sufficient to accomplish the mission 1 Determine goals individually or with others Are goals specific measurable and timely 1 Write down the goals and communicate them Is everybody on the same page 1 Review results and whether goals are being met What changes are needed in mission resources or goals MBO Management By Objectives Specific performance goals are jointly determined by employees and manager Progress towards goals is periodically reviewed Rewards programs Types of Plans Strategic Plans o Apply to entire organization o Establish the overall goals o Cover extended periods of time Operational Plans o Specify the details of how the overall goals are to be achieved o Cover SHORT period of time Long Term Plans o Plans with time frames extending beyond three years Short Term Plans o Plans with time frames on one year or less Specific Plans o Plans that are clearly defined and leave no room for interpretation Directional Plans o Flexible plans that set out general guidelines provide focus yet allow discretion in implementation Contingency Plans What will you do if the unexpected happens or change is needed Strategic Management Strategic management what managers do to develop the organization s strategies how to create deliver and capture value Strategies the plans for how the organization will do what it s in business to do how it will compete successfully and how it will attract and satisfy its customers in order to achieve its goals Business model how a company is going to capture value make Why strategic management is important 1 It results in higher organizational performance 2 It requires that managers examine and adapt to business environment changes 3 It coordinates diverse organizational units helping them focus on organizational goals