Exam 7: Decision Making

discuss the assumptions of rationality, the validity of those assumptions and the influence of bounded rationality in decision-making.

discuss the difference between structured and unstructured problems. Include specific examples of each type of problem to support your answer. Next, discuss the type of decisions that would be used to address each of these problems.

Which of the following is important in effectively implementing the chosen alternative in the decision-making process?

Unstructured problems require custom-made responses through programmed decision-making.

Refer to the scenario below to answer the following questions. Decision-making Biases (Scenario) Frank is president of Mega Manufacturing, a Canadian company that makes automobile parts. Sales and profits are down sharply this quarter, and Frank needs to analyze the series of events that have led to the poor performance. Frank begins by reviewing his recent interactions with Mike, the vice-president of sales. -Frank reluctantly agreed to authorize Mike's request for additional funds to pursue the Japanese car maker, despite some ongoing concerns he has had about how this contract could impact his current agreements with three U.S. car companies. If Mega were to win the Japanese business, they would not have sufficient production capacity to meet all their contract obligations. Frank's decision demonstrates which of the following?

Design thinking suggests that managers should look at problem identification collaboratively and integratively with the goal of ________.

Refer to the scenario below to answer the following questions. Decision-Making Conditions: Keep on Truckin' (Scenario) Fiona Lui is general manager of Westcoast Trucks, a medium-sized hauling service located in Vancouver, B.C. She is responsible for scheduling trucks, initiating new routes, and staffing both existing and new routes. She is currently struggling to find more information about the profitability of existing and future truck routes. -Fiona can make accurate decisions if she is willing to pay $5,000 for research about the profitability of various truck routes. If she pays for the research, she believes that she will be operating under a condition of __________.

Refer to the scenario below to answer the following questions. Decision-Making Conditions: Keep on Truckin' (Scenario) Fiona Lui is general manager of Westcoast Trucks, a medium-sized hauling service located in Vancouver, B.C. She is responsible for scheduling trucks, initiating new routes, and staffing both existing and new routes. She is currently struggling to find more information about the profitability of existing and future truck routes. -Sylvia, Fiona's scheduling assistant, is pessimistic about the company's ability to earn a profit from the proposed new truck route. Sylvia will most likely follow a __________ strategy.

An increased commitment to a previous decision despite evidence that it may have been wrong is a phenomenon called __________.

All relevant criteria are equally important in decision-making.

Managerial decision-making is assumed to be rational.

explain the decision errors and biases that managers make. Give simple examples for each to illustrate your answers.

After identifying a problem, the next step in the decision-making process is ________.

Which of the following is an example of a procedure?

When managers make decisions that are rational but limited by their ability to process the information, they are exhibiting the concept of ________.

According to the concept of bounded rationality, managers make decisions rationally but are limited by their ability to process information.

To receive reimbursement for their travel expenses, managers at ABC Company must first list each item in chronological order on an expense form, then attach all receipts to the upper-left corner, then obtain their supervisor's authorizing signature, and, finally, forward the form to the finance department. This is an example of a __________.

Refer to the scenario below to answer the following questions. Management Decisions : Declining Income (Scenario) Net income has fallen for the second consecutive quarter, and Amanda is understandably worried. She knows there will be a lot of questions for her at the board of directors meeting Wednesday, and she will be expected to reveal her plan to avoid any third-quarter losses. Amanda begins to analyze the company's financial reports to try to determine the cause of the loss. After much consideration, it appears that expenses have risen dramatically over the last few months. Amanda wonders why. She decides a meeting of the department heads is in order first thing tomorrow morning. At the meeting, Amanda would like to generate several possible solutions to the increased expenses. She wonders how to effectively explore all the options. Next morning, the first option presented at the meeting is to downsize the research and development department, since it is not essential to current operations. Several managers believe the plan will help stem the losses and immediately move to approve it. However, Amanda suggests that they need to look further at the issue and explore other potential solutions. Several suggestions are made, many of which appear to be viable. Amanda wonders what to do next. -According to the decision-making process, the second step Amanda should take is to __________.

An important element in making decisions using evidence-based management (EBMgt) is to consider ______________.

Refer to the scenario below to answer the following questions. Types of Problems and Decisions (Scenario) It seems Dave spends most of his day making decisions. Every time he turns around, someone wants him to make a decision about something. This morning, the office assistant came in and asked if she could reorder paper for the fax machine. That seemed like a routine decision that he should not have to deal with. If Dave could avoid those types of decisions, then he could focus more time and attention on the more complicated issues, such as the one presented to him by the production supervisor this afternoon. According to the supervisor, a major piece of equipment urgently needs repairs, and the repair bill could cost almost as much as a new machine! -Dave tells his office assistant that in future, she is authorized to order 10 boxes of fax paper whenever they are down to their last box. To handle this problem, Dave has used a type of decision called a __________.