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Chapter 2

Chapter 2. Human Decision Making Process Mallach, 2000. What is a decision?. Reasoned choice among alternatives Problem solving: overall process of closing the gap between reality and a more desirable outcome Decision statement: what we are trying t decide.

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Chapter 2

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  1. Chapter 2 Human Decision Making Process Mallach, 2000

  2. What is a decision? • Reasoned choice among alternatives • Problem solving: overall process of closing the gap between reality and a more desirable outcome • Decision statement: what we are trying t decide

  3. Decision Statement, Alternative and Criteria Fig 2.1

  4. Three Decision Process • Invented by Herbert Simon (1960) • Different people emphasize one phase from another • Different decision making situations call spending more time in one phase or another • We often bounce back

  5. Simon (1960)

  6. Types of decision

  7. Decision Tree • Example truck engine decision

  8. Subjective Utility • Utility curve defines the relationship between the amount of something that the person has and its value to person. • Usually flattens as the amount increase • Example: number of cars • In contrary: savings in bank is quite linear (little flattening)

  9. Utility Curves

  10. Systematic Decision Making • Reduce number of alternatives by determining the envelopes • Eliminate alternatives considered inferior to another • Example, choosing an instructor • The higher, the more desirable

  11. Fig 2.10 atas

  12. Criteria • Lexicographic elimination, starts with the most important attribute and keeps the alternative with the high score • Elimination by aspects, compares one attribute at a time, and compare it with a minimal standard • Conjunctive decision making, comparing sequentially • Additive linear model, puts weighs on each attribute, and calculates the total score

  13. Impact of Culture in Decision Making • “The beliefs and behaviors characteristic of a particular group” • Who make the decision? • Japan’s ‘consensual’ decision making process vs. U.S. individual decision making • Selecting a project leader in US vs. in Russia (team mates opinion matters much) • US managers decision making framework, vs. French managers decision making framework (where are we now? What are the future possibilities?)

  14. Kepner-Tregoe Decision Making Method

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