2. Ask 10 questions to the text covering it and serving as a plan.

1. Read text 2. Text 2. Decision Making

Decision making is the process through which managers identify organizational problems and attempt to resolve them. Managers deal with three types of problems: crisis, non-crisis, and opportunity. Opportunity problems provide a major vehicle for organizational innovation. Because opportunities involve ideas that could be used, rather than difficulties that must be resolved, opportunities sometimes receive insufficient attention.

Generally, managerial decision situations fall into two categories: programmed and non-programmed. Because of their nature, non-programmed decisions usually involve significant amounts of uncertainty and risk.

Two types of models have been developed to better understand the way in which managers make decisions. The rational model suggests that managers are almost perfect information handlers and, therefore, make optimal decisions. In contrast, several non-rational models of managerial decision making, including the satisfying, incremental, and garbage-can models, suggest that information-gathering and -processing limitations make it difficult for managers to make optimal decisions.

An effective decision-making process includes four major steps. The first step, identifying the problem, involves the scanning, categorization, and diagnosis stages. The second step, generating alternative solutions, emphasizes the importance of alternatives in achieving a high-quality solution. The third step, evaluating and selecting an alternative, requires consideration of feasibility, quality, acceptability, costs, and reversibility. The fourth step, implementing and following up on the solution, focuses on careful planning, sensitivity to those involved in the implementation and/or affected by it, and the design of follow-up mechanisms.

As the non-rational models of managerial decision making suggest, managers sometimes do not follow an effective decision-making process. This is largely because of four major decision barriers that must be overcome. The first, accepting the problem challenge, requires deciding to decide, rather than reacting with complacency, defensive avoidance, or panic. The second involves searching for sufficient alternatives. The third focuses on recognizing common decision-making biases, such as framing, representativeness, availability, anchoring and adjustment, and overconfidence. Finally, recent research indicates that under certain conditions managers lean toward non-rational escalation, or the escalation phenomenon, the tendency to increase commitment to a previously selected course of action beyond the level that would be expected if the manager followed an effective decision-making process.

Group decision making has several advantages and disadvantages. The advantages are that more informa­tion and knowledge is focused on the issue, an increased number of alternatives potentially can be developed, greater understanding and acceptance of the final deci­sion are likely, and members develop knowledge and skills for future use. Disadvantages are that group deci­sions are usually more time-consuming, disagreement may delay decision making and cause hard feelings, the discussion may be dominated by one or a few group members, and groupthink may cause members to over­emphasize gaining agreement. Managers can take a number of steps to help minimize the disadvantages.

A major aspect of promoting innovation is the crea­tivity factor. Creativity involves both convergent and divergent thinking. Basic ingredients of the creative pro­cess are domain-relevant skills, creativity-relevant skills, and task motivation. The creativity process comprises four stages: preparation, incubation, illumination, and verification. Techniques for enhancing creativity include brainstorming, the nominal group technique, and synectics.