MHR 405 Chapter Notes - Chapter 8: Bounded Rationality, Satisficing, Odd Future

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Creativity: a process influenced by individual and organizational factors that results in the
production of novel and useful ideas, products or both
Creativity can be found and is required in all aspects of business and management
The 4 Stages of the Creative Process
1) Preparation: means seeking out new experiences and opportunities to learn, because
creativity grows from a base of knowledge
2) Incubation: during this stage, the individual engages in other pursuits while the mind
considers the problem and works on it. Incubation is a process of reflective thought and is
often conducted subconsciously
3) Illumination: illumination occurs when the individual senses an insight for solving the
problem. This stage is also called theaha experience.
4) Verification: is conducted to determine whether the solution or idea is valid. This is
accomplished by thinking though the implications of the decision, presenting the idea to
another person or trying out the decision
Individual Influences in Creative Problem Solving
Cognitive Processes, Personality Factors, and Mental Blocks
Divergent Thinking: an individuals ability to generate several potential solutions to a problem
Associational abilities and the use of imagery, unconscious processes and personality factors
all play a role in creative thinking
Good mood, tolerance of ambiguity, intrinsic motivation, risk taking and a desire for
recognition are all relate to creative thinking
Mental blocks can diminish creativity
Right Brain versus Left Brain Preferences
The right side is the center for creative functions and intuition while the left side is the center
for logic, detail and planning
There are advantages to both kinds of thinking, so the ideal situation is to be brain-lateralized
Organizational Influences on Creativity
Organizational Facilitators of Creativity
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1) Leadership: leadership can encourage norms that are associated with increased group
innovation, such as support for risk taking, tolerance of mistakes, teamwork and speed of
2) Organizational Structure: When the chain of command is minimized and the structure
kept simple, employees are encouraged to create and innovate
3) Physical environment and communication: information flow and the physical
environment are important so that ideas can surface and be heard
4) Recognition: monetary rewards may or may not improve creative performance
5) Culture: allowing employees to fail, making work more fun, and providing creativity
training also facilitate creativity.
Organizational Barriers to Creativity
Creativity killers include focusing on how work is going to be evaluated, being watched
while you are working, and competing with people in win-lose situations. These barriers
include internal political problems, harsh criticism of ideas, destructive internal
competition and avoidance of risk
Research has indicated that creative performance is highest when there is a match or fir
between the individual and organizational influences on creativity.
Decision Making: a conscious process of making choices among one or more alternatives
and developing a commitment to a course of action
Programmed Decision Making: a simple, routine matter for which a manager has an
established decision rule
Nonprogrammed Decision Making: a new, complex decision that requires a creative
Effective Decision: a timely decision that meets a desired objective and is accepted by the
Ethical Decision: a decision that is made after exploring alternatives and their consequences
so that actions are consistent with ones personal values and commonly held values of the
organization and society
Models of Decision Making
The Rational Model of Decision Making
Rationality refers to a logical, step by step approach to decision making, with a thorough
analysis of alternatives and their consequences.
This model has the following important assumptions;
-The outcome will be completely rational
-The decision maker has a consistent system of preferences, which is used to
choose the best alternative
-The decision maker is aware of all the possible alternatives
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