MAN 3025 Lecture Notes - Lecture 7: Hindsight Bias, Analysis Paralysis, Bounded Rationality
Document Summary
Chapter 10 class notes: decision making- refers to selecting choices among alternative courses of action, which may also include inaction. Increasing effectiveness in decision making is an important part of maximizing effectiveness at work: programmed decisions- straightforward decisions that occur frequently enough that an automated response is developed. The automated response is called the decision rule: nonprogrammed decisions- unique and require conscious thinking, information gathering, and careful consideration of alternatives, rational model. The one we try to emulate when we have important costly decisions. Assumes people understand the decision, know their available choices, have no. Important to define the problem perceptual biases, want to make optimal decisions: analysis paralysis: No decision gets made: bounded rationality model. Individuals knowingly limit their options and choose the best alternative without conducting an exhaustive search for alternatives. Satisficing refers to accepting the first alternative that meets minimum criteria. One alternative at a time: making intuitive decisions.
