ECOS3003 Lecture Notes - Lecture 4: Collective Action, Ex-Ante
30 Jul 2018
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Trust and decision rights: the level of empowerment. Team: many different types of work groups that have decision-making authority (teams, committees, task forces). Firms grant decision rights to teams for: managing activities, making products, recommending actions, assigning decisions to a group rather than to an individual. Improved use of dispersed specific knowledge: encourage transfer of knowledge (decision by consensus or vote). Employee buy-in: more receptive to ideas / changes / decisions if know that peers have been involved in the process. Decision management and control: decision management: the initiation and implementation of decisions, decision control: ratification and monitoring of decisions, decision-making process has 4 steps: In a hierarchy, an individual should have both dm and dc for different decisions, e. g. a division manager has approval rights over certain initiations of lower-level employees but must request authorisation for division expenditure. Benefit: reduces resources expended on individuals trying to influence decisions and decision-makers.
