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1Decision MakingModels of Decision Making• The Rational Model– Consists of a structured four-step sequence:• identifying the problem• generating alternative solutions• selecting a solution• implementing and evaluating the solution2Simon’s Normative Model- Based on premise that decision making is notrational- Decision making is characterized by* limited information processing* use of rules of thumb or shortcuts* satisficingAssets of Group Decision Making• Groups can accumulate more knowledge and facts• Groups have a broader perspective and consider more alternative solutions• Individuals who participate in decisions are more satisfied with the decision and are more likely to support it.• Group decision making processes serve an important communication function as well as a useful political function.3Liabilities of Group Decision Making• Groups often work more slowly than individuals.• Groups decisions involve considerable compromise that may lead to less than optimal decisions.• Groups are often dominated by one individual or a small clique, thereby negating many of the virtues of group processes.• Overreliance on group decision making can inhibit management’s ability to act quickly and decisively when necessary.Individual vs. Group Decision Making• In establishing objectives, groups are probably superior to individuals because of the greater amount of knowledge available to groups.• In identifying alternatives, the individual efforts of group members encourage a broad search in various functional areas of the organization.• In evaluating alternatives, the collective judgement of the group, with its wider range of viewpoints, seems superior to that of the individual decision maker.4Individual vs. Group Decision Making• In choosing an alternative, group interaction and the achievement of consensus usually result in the acceptance of more risk than would be accepted by an individual decision maker.• Implementing a decision, whether or not it was made by a group, is usually accomplished by individual


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UNF MAN 6204 - Decision Making

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