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Lecture 7

MGT 300 Lecture Notes - Lecture 7: Delphi Method, Groupthink, Nominal Group Technique

Course Code
MGT 300
Marcus Trice

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Management 300
Chapter 7: Decision Making, Learning, Creativity, and Entrepreneurship
!*know for test
Decision Making*: The process by which managers respond to opportunities and threats by analyzing
options and making determinations about specific organizational goals and courses of action.
Decisions in Response to Opportunities: occurs when managers respond to ways to improve
organizational performance to benefit customers, employees, and other stakeholder groups.
Decisions in Response to Threats: Events inside of outside the organization are adversely affecting
organizational performance.
Programmed Decision Making*: Routine, virtually automatic decision making that follows established
rules or guidelines.
Non-programmed Decision Making*: non routine decision making that officers in response to unusual,
unpredictable opportunities and threats.
Intuition: Feelings, beliefs, and hunches that come readily to mind, require little effort and information
gathering, and result in on-the-spot decisions.
Reasoned Judgement: A decision that requires time and effort and results from careful information
gathering, generation of alternatives, and evaluation of alternatives.
Classical Decision-Making Mode*l: A prescriptive approach to decision making based on the
assumption that the decision maker can identify and evaluate all possible alternatives and their
consequences and rationally choose the most appropriate course of action.
!They have all the information.
Optimum Decision: The most appropriate decision in light of what managers believe to be the most
desirable consequences for the organization.
Administrative Model: An approach to decision making that explains why decision making is inherently
uncertain and risky and why managers usually make satisfactory rather than optimum decisions.
Bonded rationality: Cognitive limitations that constrain one’s ability to interpret, process, and act on
Risk*: The degree of probability that the possible outcomes of a particular course of action will occur.
Uncertainty*: unpredictability. The probability of alternative outcomes cannot be determined and future
outcomes are unknown.
Ambiguous Information: Information that can be interpreted in multiple and often conflicting ways.
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