BUS 51 - Mosley7e ch03

© 2008 Thomson/South-Western© 2008 Thomson/South-Western All rights reserved. All rights reserved.

PowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie CookThe University of West AlabamaThe University of West Alabama

Part 2

Planning and Organizing

Mosley Mosley • Pietri• Pietri

Chapter 3

Decision Making,

Problem Solving,

and Ethics

Chapter 3

Decision Making,

Problem Solving,

and Ethics

© 2008 Thomson/South-Western. All rights reserved. 3–2

Learning ObjectivesLearning ObjectivesLearning ObjectivesLearning Objectives

1.1. Explain the role of decision making in the supervisor’s Explain the role of decision making in the supervisor’s job.job.

2.2. Define decision making and identify at least four Define decision making and identify at least four elements involved.elements involved.

3.3. Discuss why supervisors need to make so many Discuss why supervisors need to make so many decisions.decisions.

4.4. Discuss how decisions are made.Discuss how decisions are made.

5.5. Name some factors to keep in mind when making Name some factors to keep in mind when making decisions.decisions.

After reading and studying this chapter, you should After reading and studying this chapter, you should be able to:be able to:


Learning Objectives (cont’d)Learning Objectives (cont’d)Learning Objectives (cont’d)Learning Objectives (cont’d)

6.6. Decide whether to use the individual approach or the Decide whether to use the individual approach or the group approach when making decisions.group approach when making decisions.

7.7. Discuss some ways of improving decision making.Discuss some ways of improving decision making.

8.8. Explain the role of ethics in the supervisor’s decision Explain the role of ethics in the supervisor’s decision making.making.

After reading and studying this chapter, you should After reading and studying this chapter, you should be able to:be able to:


Role of Decision Making Role of Decision Making in Supervisory in Supervisory ManagementManagement• Decisions and the Management Functions:Decisions and the Management Functions:

PlanningPlanning—deciding which objectives to seek, which policies to —deciding which objectives to seek, which policies to establish, and what rules to institute.establish, and what rules to institute.

OrganizingOrganizing—deciding who gets what authority and how duties —deciding who gets what authority and how duties and responsibilities are grouped.and responsibilities are grouped.

StaffingStaffing—deciding employee selection, placement, training and —deciding employee selection, placement, training and development, performance appraisal, compensation, and health development, performance appraisal, compensation, and health and safety.and safety.

LeadingLeading—deciding how best to communicate with and motivate —deciding how best to communicate with and motivate employees.employees.

ControllingControlling—deciding how to match planned performance with —deciding how to match planned performance with actual performance.actual performance.


EXHIBIT 3.1 Decision Making is the Heart of Supervisory Management


Why Supervisors Need to Make So Why Supervisors Need to Make So Many DecisionsMany Decisions

• Decisions and SupervisorsDecisions and Supervisors To direct employees’ behavior toward goals of the To direct employees’ behavior toward goals of the

organization and the employees’ own goals.organization and the employees’ own goals. The organizational environment of supervisors The organizational environment of supervisors

requires more (and more frequent) decisions about a requires more (and more frequent) decisions about a larger variety of activities of many other people.larger variety of activities of many other people. Operative employees require more direction, guidance, and Operative employees require more direction, guidance, and

protection that higher-level employees.protection that higher-level employees.

• Span of ManagementSpan of Management The number of immediate employees a manager can The number of immediate employees a manager can

supervise effectively.supervise effectively.


What Is Decision Making?What Is Decision Making?

• Decision Making DefinedDecision Making Defined The conscious consideration and selection of a The conscious consideration and selection of a

course of action from among two or more available course of action from among two or more available alternatives in order to produce a desired result.alternatives in order to produce a desired result.

• Elements Involved in Decision MakingElements Involved in Decision Making A decision may not be needed.A decision may not be needed.

Decisions involve the futureDecisions involve the future

Decision making is a conscious processDecision making is a conscious process

Decision making involves more than one alternativeDecision making involves more than one alternative


EXHIBIT 3.2 Decision-Making Process


Types of Decisions to Be MadeTypes of Decisions to Be Made

• Programmed DecisionsProgrammed Decisions Routine and repetitive decisions that are handled in a Routine and repetitive decisions that are handled in a

systematic way.systematic way. Example: Setting a production schedule.Example: Setting a production schedule.

• Unprogrammed DecisionsUnprogrammed Decisions Decisions that occur infrequently and require a Decisions that occur infrequently and require a

different response each time.different response each time. Example: deciding on which employee to promote.Example: deciding on which employee to promote.


How Decision Making and Problem How Decision Making and Problem Solving RelateSolving Relate

• Which Is It?Which Is It? OpportunityOpportunity—a—a chance for development or chance for development or

advancement.advancement. ProblemProblem—a—an existing unsatisfactory situation causing n existing unsatisfactory situation causing

anxiety or distress.anxiety or distress.

• What Effective Supervisors DoWhat Effective Supervisors Do Identify problems and their cause(s).Identify problems and their cause(s). Analyze complex and involved situations.Analyze complex and involved situations. Solve problems by removing their cause(s).Solve problems by removing their cause(s). Recognize that opportunities represent progress.Recognize that opportunities represent progress.


EXHIBIT 3.3 Steps in Decision Making


How to Make DecisionsHow to Make Decisions

• Step 1:Step 1: Define the Idea or ProblemDefine the Idea or Problem Correctly defining the real problem (i.e., root causes) Correctly defining the real problem (i.e., root causes)

is key to correctly solving the problem.is key to correctly solving the problem.

• Step 2:Step 2: Develop AlternativesDevelop Alternatives Identifying possible courses of action that can satisfy Identifying possible courses of action that can satisfy

a need or solve a problem.a need or solve a problem.

• Step 3:Step 3: Collect, Interpret, and EvaluateCollect, Interpret, and EvaluateInformation about Each AlternativeInformation about Each Alternative

Knowledge of the alternatives is necessary to Knowledge of the alternatives is necessary to objectively evaluate the applicability and feasibility of objectively evaluate the applicability and feasibility of each alternative.each alternative.


EXHIBIT 3.4 Evaluating Alternatives


How to Make Decisions (cont’d)How to Make Decisions (cont’d)

• Step 4:Step 4: Select the Preferred AlternativeSelect the Preferred Alternative Cost/benefit analysisCost/benefit analysis—e—estimating and comparing the stimating and comparing the

costs and benefits of alternatives.costs and benefits of alternatives. RiskRisk—t—the possibility of defeat, disadvantage, injury, he possibility of defeat, disadvantage, injury,

or loss.or loss.

• Step 5:Step 5: Implement the DecisionImplement the Decision Putting the decision into operation.Putting the decision into operation.

• Step 6:Step 6: Follow Up, Evaluate, and Make Follow Up, Evaluate, and Make Changes—If NeededChanges—If Needed Exercising control through the provision of feedback Exercising control through the provision of feedback

and corrective action to attain the desired results.and corrective action to attain the desired results.


Approaches to Decision Making and Approaches to Decision Making and Problem SolvingProblem Solving

• The Myers-Briggs Type Indicator (MBTI)The Myers-Briggs Type Indicator (MBTI)

Measures eight dimensions of personality types to Measures eight dimensions of personality types to identifies an individual’s personal style.identifies an individual’s personal style.

Four internal dimensions are directly related to Four internal dimensions are directly related to decision making and problem solving:decision making and problem solving: SensingSensing—patient, practical, and realistic—patient, practical, and realistic

IntuitionIntuition—impatient, idea and theory oriented, and creative—impatient, idea and theory oriented, and creative

ThinkingThinking—rational, logical, objective, and analytical—rational, logical, objective, and analytical

FeelingFeeling—relationship-oriented, empathetic, and socially —relationship-oriented, empathetic, and socially awareaware


EXHIBIT 3.5 Characteristics of Different Personality Types

Source: Reproduced by special permission of the publishers, Consulting Psychologists Press, Inc., Palo Alto, CA 94303, from Introduction to Type by Isabel Briggs Myers. Copyright 1980 by Consulting Psychologists Press, Inc. All rights reserved. Further reproduction is prohibited without the publisher’s consent.

Sensing Types

Dislike new problems unless there are standard ways to solve them.

Like an established way of doing things.

Enjoy using skills already learned more than learning new ones.

Work more steadily, with realistic idea of how long it will take.

Usually reach a conclusion step-by-step.

Are patient with routine details.

Are impatient when the details get complicated.

Are not often inspired, and rarely trust the inspiration when they are.

Seldom make errors of fact.

Tend to be good at precise work.

Intuitive Types

Like solving new problems.

Dislike doing the same thing repeatedly.

Enjoy learning a new skills more than using it.

Work in bursts of energy powered by enthusiasm, with slack periods in between.

Reach a conclusion quickly.

Are impatient with routine details.

Are patient with complicated situations.

Follow their inspirations, good or bad.

Frequently make errors of fact.

Dislike taking time for precision.

SENSING AND INTUITIVE CHARACTERISTICS


EXHIBIT 3.5 Characteristics of Different Personality Types (cont’d)

Source: Reproduced by special permission of the publishers, Consulting Psychologists Press, Inc., Palo Alto, CA 94303, from Introduction to Type by Isabel Briggs Myers. Copyright 1980 by Consulting Psychologists Press, Inc. All rights reserved. Further reproduction is prohibited without the publisher’s consent.

THINKING AND FEELING CHARACTERISTICS

Thinking Types

Do not show emotion readily and are often uncomfortable dealing with people’s feelings.

May hurt people’s feelings without knowing it.

Like analysis and putting things into logical order. Can get along without harmony.

Tend to decide impersonally, sometimes paying insufficient attention to people’s wishes.

Need to be treated fairly.

Are able to reprimand people or fire them when necessary.

Are more analytically oriented—respond more easily to people’s thoughts.

Tend to be firm minded.

Feeling Types

Tend to be very aware of other people and their feelings.

Enjoy pleasing people, even in unimportant things.

Like harmony. Efficiency may be badly disturbed by office feuds.

Often let decisions be influenced by their own or other people’s personal likes and wishes.

Need occasional praise.

Dislike telling people unpleasant things.

Are more people oriented—respond more easily to people’s values.

Tend to be sympathetic.


Approaches to Decision Making and Approaches to Decision Making and Problem Solving (cont’d)Problem Solving (cont’d)

• The Vroom-Yetton ModelThe Vroom-Yetton Model Provides guidelines for supervisors on the extent to Provides guidelines for supervisors on the extent to

which subordinates are involved in decision making or which subordinates are involved in decision making or problem solving.problem solving.

• Factors Affecting Involvement in DecisionsFactors Affecting Involvement in Decisions Situational conditions of the problemSituational conditions of the problem Quality of information available about the problemQuality of information available about the problem Importance of subordinates’ acceptance of the Importance of subordinates’ acceptance of the

decisiondecision Timeframe for the decisionTimeframe for the decision


EXHIBIT 3.6 Managers’ Participation Styles for Making Decisions

Source: Adapted and reprinted from Leadership and Decision-Making, by Victor H. Vroom and Philip W. Yetton, by permission of the University of Pittsburgh Press. © 1973 University of Pittsburgh Press.

Participation

Style Description

A You solve the problem or make the decision yourself, using the information available to you at the present time.

B You obtain any necessary information from subordinates, then decide on a solution to the problem yourself.

C You share the problem with the relevant subordinates individually, getting their ideas and suggestions without bringing them together as a group. Then you make the decision.

D You share the problem with your subordinates in a group meeting, in which you obtain their ideas and suggestions. Then you make the decision.

E You share the problem with your subordinates as a group. Together you generate and evaluate alternatives and attempt to reach agreement (consensus) on a solution. You can provide the group with information or ideas, but you do not try to press them to adopt “your” solution, and you are willing to accept and implement any solution that has the support of the entire group.


EXHIBIT 3.7 Decision Tree, Governing Group Problems


EXHIBIT 3.8 The Vroom-Yetton Model: Which Decision Style to Use

Decision Problem

As president of the Student Management Club at State University, you must make a decision concerning a date for the annual student banquet.

Q1 Is there a quality requirement such that one solution is likely to be more rational than another?

Ans Yes. One solution is likely to be more rational since there are various dates that will be unsatisfactory because of competing activities.

Q2 Do you have sufficient information to make a high-quality decision?

Ans No. You may have certain information on competing dates for some officially scheduled university activities, but there may be some other kinds of activities going on that you are unaware of.

Q3 Is the problem structured?

Ans Yes. Selection of a date for a banquet to be held within the next month is a well-structured decision problem.

Q4 Is acceptance of the decision by your subordinates critical to implementation?

Ans Yes. If the subordinates (and others) don’t show up, the banquet is a failure.

Q5 Is it reasonably certain that the decision would be accepted by you subordinates if you were to make it by yourself?

Ans No. You might accidentally select a date that would not be suitable to your subordinates. For example, the day you select could be one on which subordinates have a major exam or term papers due the following day.

Q6 Do members share the view that the banquet date is important?

Ans Yes. Members have shown good attendance at meetings and consider the banquet the highlight of the year. Awards are presented, next year’s officers announced, and so on.

Optimum Decision Style

As president, you should share the problem with members as a group, with the group generating and evaluating alternatives, and should attempt to arrive at a consensus decision.


Bases of Decision MakingBases of Decision Making

• Authority of positionAuthority of position——authority vested authority vested in the decision maker’s position.in the decision maker’s position.

• ExperienceExperience——practical knowledge of practical knowledge of what has been done in the past.what has been done in the past.

• FactsFacts——pertinent information, carefully pertinent information, carefully classified, diagnosed, and interpreted.classified, diagnosed, and interpreted.

• IntuitionIntuition——unconscious influence of a unconscious influence of a person’s cultural backgrounds, person’s cultural backgrounds, education, and training.education, and training.

• Follow-the-leaderFollow-the-leader——the herd instinct, the herd instinct, based on doing what others are doing.based on doing what others are doing.


Advantages of Group Decision MakingAdvantages of Group Decision Making

• Provides the supervisor with a broader range of Provides the supervisor with a broader range of information on the problem, alternatives, and information on the problem, alternatives, and recommended solution.recommended solution.

• Lends more creative approach to solving problems, Lends more creative approach to solving problems, since ideas may be “piggybacked.”since ideas may be “piggybacked.”

• Improves communication in the department because the Improves communication in the department because the group becomes aware of issues facing the supervisor.group becomes aware of issues facing the supervisor.

• Creates higher morale in the group.Creates higher morale in the group.

• Stresses a stronger commitment to the decision once it Stresses a stronger commitment to the decision once it is made, since the group helped to make it.is made, since the group helped to make it.


Disadvantages of Group Decision Disadvantages of Group Decision MakingMaking• Holds the supervisor accountable for the group’s Holds the supervisor accountable for the group’s

decisions.decisions.

• Takes the group away from other aspects of their jobs.Takes the group away from other aspects of their jobs.

• May force the supervisor to choose sides and thus cause May force the supervisor to choose sides and thus cause morale problems.morale problems.

• Allows strong personalities to dominate the group, in Allows strong personalities to dominate the group, in which case the decision may not reflect the entire which case the decision may not reflect the entire group’s opinion.group’s opinion.

• Requires more supervisory skill in communicating and Requires more supervisory skill in communicating and clarifying the group’s role in a given decision.clarifying the group’s role in a given decision.

• Is difficult to use if the decision must be made quickly.Is difficult to use if the decision must be made quickly.


Approaches to Decision Making and Approaches to Decision Making and Problem Solving (cont’d)Problem Solving (cont’d)

• Creative Problem SolvingCreative Problem Solving SynergySynergy—the whole is greater than the sum of the —the whole is greater than the sum of the

parts.parts. Synergistic solutions can be defined asSynergistic solutions can be defined as

1 + 1 + 1 + 1 + 1 = more than 5.1 + 1 + 1 + 1 + 1 = more than 5.

• Developing CreativityDeveloping Creativity Deferred judgment—using right-hemisphere functions Deferred judgment—using right-hemisphere functions

as thought generators and following them with left-as thought generators and following them with left-brained functions that result in powerfully effective brained functions that result in powerfully effective “whole-brained” creativity.“whole-brained” creativity.


Creative Problem SolvingCreative Problem Solving

• BrainstormingBrainstorming Occurs when a group of individuals generates ideas Occurs when a group of individuals generates ideas

in response to a question without evaluating the ideas in response to a question without evaluating the ideas as they are produced.as they are produced.

• Guidelines for Using BrainstormingGuidelines for Using Brainstorming The group favors quantity over quality.The group favors quantity over quality. Members refrain from judging contributions; they can Members refrain from judging contributions; they can

ask questions later, in the evaluation part.ask questions later, in the evaluation part. Team members avoid censoring.Team members avoid censoring. Pride of authority is minimized; members should feel Pride of authority is minimized; members should feel

free to offer variants and build on one another’s ideas.free to offer variants and build on one another’s ideas.


Creative Problem Solving (cont’d)Creative Problem Solving (cont’d)

• The Crawford Slip TechniqueThe Crawford Slip Technique

Achieves creativity through:Achieves creativity through: FluencyFluency——the ability to let ideas flow out of your head like the ability to let ideas flow out of your head like

water over a waterfallwater over a waterfall

FlexibilityFlexibility——the ability to use free association to generate or the ability to use free association to generate or classify ideas in categories.classify ideas in categories.

• Nominal Grouping TechniqueNominal Grouping Technique

Is a structured group technique for generating ideas Is a structured group technique for generating ideas through round-robin individual responses, group through round-robin individual responses, group sharing without criticism, and written balloting.sharing without criticism, and written balloting.


EXHIBIT 3.9 Steps in Nominal Grouping

Divide into groups of six or nine persons.

Without interaction, list the strengths you feel are associated with Question I, then list the problems for Question 2.

(Time: 6 minutes.)

Select a recorder.

a. The recorder asks each member, one at a time, to read from his or her card one strength associated with Question I. Example: What are the strengths of this plant?

b. The recorder writes each strength exactly as it is read.

c. Those having the same strength should raise hands. The recorder checkmarks each strength once for each person raising a hand.

d. When all Question I strengths are recorded, the procedure is repeated for Question 2 problems. Example: What are the problems preventing this plant from reaching its potential effectiveness?

Discuss the two lists. Clarify, defend, elaborate, or add other items as needed.(Time: 5 minutes.)

Without interaction, each member lists on an index card the five items he or she considers most important with reference to Question I; do the same for Question 2.

The recorder collects and records the votes.


Factors to Keep in Mind When Making Factors to Keep in Mind When Making DecisionsDecisions• The right person should make the decision.The right person should make the decision.

• Decisions should contribute to objectives.Decisions should contribute to objectives.

• There’s seldom only one acceptable choice.There’s seldom only one acceptable choice.

• Both feeling and thinking should be used.Both feeling and thinking should be used.

• Effective decision making takes considerable time and Effective decision making takes considerable time and effort.effort.

• Decision making improves with practice.Decision making improves with practice.

• A decision may not please everyone.A decision may not please everyone.

• A decision starts a chain reaction.A decision starts a chain reaction.

• Ethical considerations must play a part.Ethical considerations must play a part.


The Role of Ethics in the Decision The Role of Ethics in the Decision MakingMaking• EthicsEthics

The standards used to judge the “rightness” or The standards used to judge the “rightness” or “wrongness” of one person’s behavior toward others.“wrongness” of one person’s behavior toward others.

• Levels of BehaviorLevels of Behavior Personal ethics is the highest and most rigid level of Personal ethics is the highest and most rigid level of

behavior.behavior. Professional and organizational codes of ethics as Professional and organizational codes of ethics as

statements of what is and isn’t acceptable behavior.statements of what is and isn’t acceptable behavior. The lowest level of ethical behavior is the legal level, The lowest level of ethical behavior is the legal level,

where all are expected to adhere to the “law of the where all are expected to adhere to the “law of the land.”land.”


Responses to Ethical IssuesResponses to Ethical Issues

• Businesses have responded to increased Businesses have responded to increased pressures for ethical conduct by:pressures for ethical conduct by:

Adopting of codes of conduct.Adopting of codes of conduct.

Setting social goals that boost business.Setting social goals that boost business.

Better monitoring of business practices through Better monitoring of business practices through internal audits.internal audits.


Ethics: How Do I Know It’s Right?Ethics: How Do I Know It’s Right?

Is it legal?Is it legal? Will my decision violate either company Will my decision violate either company policy or civil law?policy or civil law?

Is it balanced?Is it balanced? Is it fair to all concerned in the short term as Is it fair to all concerned in the short term as well as in the long term?well as in the long term?Does it promote win-win relationships?Does it promote win-win relationships?

How will it make me How will it make me feel about myself?feel about myself?

Would I feel good if my decision were Would I feel good if my decision were published in the newspaper?published in the newspaper?

Would I feel good if my family knew about Would I feel good if my family knew about my decision?my decision?


Important TermsImportant TermsImportant TermsImportant Terms

• managerial decision makingmanagerial decision making• programmed decisionsprogrammed decisions• nonprogrammed decisionsnonprogrammed decisions• decision treedecision tree• creativitycreativity• Myers-Briggs Type Indicator (MBTI)Myers-Briggs Type Indicator (MBTI)• Vroom-Yetton ModelVroom-Yetton Model• synergysynergy• brainstormingbrainstorming• Crawford Slip TechniqueCrawford Slip Technique• fluencyfluency• flexibilityflexibility• nominal grouping technique (NGT)nominal grouping technique (NGT)

BUS 51 - Mosley7e ch03

Business

Transcript of BUS 51 - Mosley7e ch03