Chapter 13 notes.docx

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Ryerson University
Global Management Studies
GMS 200
Ricardo Reyes

Chapter 13 – Information and Decision Making Information, Technology, and Management Information and knowledge – basic linkages: • Knowledge and knowledge workers provide a decisive competitive factor in today’s economy • Knowledge worker o Someone whose value to the organization rests with intellect, not physical capabilities • Intellectual capital o Share knowledge of a workforce that can be used to create wealth • Knowledge and intellectual capital are irreplaceable organization resources • The productivity of knowledge and knowledge workers depends on: o Computer competency o Information competency What is useful Information? • Data o Raw facts and observations • Information o Data made useful for decision making • Information drives management functions • Characteristics of useful information: o Timely o High quality o Complete o Relevant o Understandable Implications of IT within organizations: • Facilitation of communication and information sharing • Operating with fewer middle managers 1 • Flattening of organizational structures • Faster decision making • Increase coordination and control Implications of IT for relationships with external environment: • Helps with customer relationship management • Helps organizations with supply chain management • Helps in monitoring outsourcing and other business contracts Information needs of organizations • Information exchanges with the external environment o Gather intelligence information o Provide public information • Information exchanges within the organization o Facilitate decision making o Facilitate problem solving Basic information system concepts: • Information system o Use of the latest IT to collect, organize, and distribute for use in decision making • Management Information System (MIS) • Specifically designed to meet the information needs of managers in daily decision making Information and Managerial Decisions Managerial advantages of IT utilization: • Planning advantages o Better and timelier access to useful information • Organization advantages o More ongoing and informed communication among all parts of the organization o Improved coordination and integration • Leading advantages o Improved communication with staff and stakeholders 2 o Keeping objectives clear • Controlling advantages o More immediate measures of performance results o Allows real-time solutions to performance problems Managers as Problem Solvers • Performance deficiency o Actual performance being less than desired performance • Performance opportunity o Actual performance being better than desired performance • Problem solving o The process of identifying a discrepancy between actual and desired performance and taking action to resolve it • Decision o A choice among possible alternative course of action Problem-solving approaches or styles: • Problem avoiders o Inactive in information gathering and solving problems • Problem solvers o Reactive in gathering information and solving problems • Problem seekers o Proactive in anticipating problems and opportunities and taking appropriate action to gain an advantage Systematic versus intuitive thinking • Systematic thinking approaches problems in a rational, step-by-step, and analytical fashion • Intuitive thinking approaches problems in a flexible and spontaneous fashion • Multidimensional thinking applies both intuitive and systematic thinking • Effective multidimensional thinking requires skill at strategic opportunism Cognitive styles 3 • Sensation Thinkers emphasize the impersonal rather than the personal and take a realistic approach to problem solving • Intuitive Thinkers are comfortable with abstraction and tend to be idealistic, spontaneous fashion • Intuitive Feelers prefer broad and global issues and are comfortable with intangibles • Sensation Feelers emphasize analysis and human relations and tend to be realistic and prefer facts Programmed decisions • Apply solutions that are readily available from past experiences to solve structured problems • Structured problems are ones that are familiar, straightforward, and clear with respect to information needs • Best applied to routine problems that can anticipated Nonprogrammed decisions • Develop novel solutions to meet the demands of unique situation that present unstructured problems unstructured problems are ones that are full of ambiguities and information deficiencies • Commonly faced by higher-level management Crisis decision making • A crisis involves an unexpected problem that can lead to disaster if not resolved quickly and appropriately • Rules for crisis management o Figure out what is going on o Remember that speed matters o Remember that slow counts too o Respect the danger of the unfamiliar o Value the skeptic o Be ready to “fight fire with fire” Decision conditions • Certain environments o Offer complete information about possible action alternatives and their outcomes • Risk environments 4 o Lack complete information about action alternatives and their consequences, but offer some estimates of probabilities of outcomes for possible action alternatives • Uncertain environmen
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