MGT 125 Lecture Notes - Lecture 20: Rationality, Bounded Rationality, Minimax
Document Summary
Rational if: simple goal with goals, min. time pressure, cost seeking alternatives, culture of risk. Rational behaviour within parameters of simplified decision making process limited by ability to process info. Escalation of commitment: increase commitment to previous decision despite evidence it may be wrong. Intuitive decision making: subconscious process of making decisions on basis of experience, feelings & accumulated judgment. Structured problems: straightforward, familiar & easily defined problems. Programmed decision: repetitive decision handled by routine approach. Procedure: series of interrelated sequential steps manager uses to respond to structured problem. Rule: explicit statement tells manager what can/cant do. Policy: guideline est. parameters for making decisions (via interpretation) Unstructured problems: new, unusual problems for which info"s ambiguous or incomplete. Problems more unstructured as move up org hierarchy. Manger makes accurate decisions because outcome of every alternative"s known. Conditions in which decision maker estimates likelihood of certain outcomes (due to experience or 2ndary info)
