Work Psychology ppt

7/31/2019 Work Psychology ppt

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By : Fareed Virk



A decision is a choice made fromavailable alternatives.



Decision Making Process



Recognition ofdecision

requirements

Diagnosis andAnalysis of

Causes

Developmentof Alternatives

Selection ofDesiredAlternative

Implementationof Chosen

Alternative

Evaluation andfeedback



How are decisions made

in organizations?



Decision environments include:

Certain environments.

A situation in which a manager can make an accurate

decision because the outcome of every alternative choice

is known.

Risk environments.

A situation in which the manager is able to estimate thelikelihood (probability) of outcomes that result from the

choice of particular alternatives.

Uncertain environments.

Limited information prevents estimation of outcome

probabilities for alternatives associated with the problem

and may force managers to rely on intuition, hunches, and

“gut feelings”.



Types of Decisions



8

PROGRAMMED

DECISIONS.

Involve routine problems

that arise regularly and can

be addressed through

standard responses.

NONPROGRAMMED

DECISIONS.

Involve non-routine

problems that require

solutions specifically

tailored to the situation at

hand



Organizational Level Nature of Problems Nature ofDecision-Making





Classical Decision

Theory

The classical decisionmaker:

Faces a clearly definedproblem.

Knows all possibleaction alternatives andtheir consequences.

Full information aboutalternatives and theiroutcomes.

Chooses the optimumalternative.

Is often used as a modelof how managers shouldmake decisions.



BehavioralDecision Theory

Recognizes that human

beings operate with: Cognitive limitations.

Bounded rationality.

The behavioral decisionmaker: Faces a problem that is

not clearly defined.

Has limited knowledgeof possible actionalternatives and their

consequences. Chooses a satisfactory

alternative.



Garbage Can

Model

Views decision-making as ahighly unstructured process

A model of decision makingthat views problems,solutions, participants, andchoice situations as mixed

together in the “garbagecan” of the organization.

Instead of identifying aproblem,the model proposesthat decisions begin with the

solution. When solutionsemerge, problems arise.



Decision Making Approach



Rationality

Bounded Rationality

Intuition

Involves gut feeling

May also have rational basis

The “feeling” arises from past experience and knowledge

Involves quicker response

Some believe it is a personality trait with which very few

people are born with

It doesn’t necessarily operate independently of rational

analysis; rather the two complement



Heuristics

Availability A decision maker’stendency to basedecisions on informationthat is readily availablein memory.

Anchoring andadjustment

Bases a decision onincremental adjustmentsto an initial valuedetermined by historicalprecedent or somereference point.

RepresentativenessThe tendency to assessthe likelihood of anevent occurring basedon one’s impressionsabout similaroccurrences.



Decision Making

Styles



Directive

•Use minimalinformation andconsider fewalternatives

•Seek rationality

Analytic

•Need moreinformation andalternatives

•Make carefuldecisions in

uniquesituations

Conceptual

•Good at findingcreativesolutions.

•Maintain abroad outlook

and considermanyalternatives inmakingdecisions

Behavioral

•Strong concernfor people in theorganizationand theirdevelopment

•Avoid conflictby working wellwith others andbeing receptiveto suggestions















Decision Making Tools



Qualitative

SWOT PEST

Stakeholder Analysis

HRM

Quantitative

Break-even Analysis

PERT

CPM

Decision Trees



Characteristics of an EffectiveDecision-Making Process

It focuses on what is important.

It is logical and consistent.

It acknowledges both subjective and objective thinkingand blends analytical with intuitive thinking.

It requires only as much information and analysis as isnecessary to resolve a particular dilemma.

It encourages and guides the gathering of relevantinformation and informed opinion.

It is straightforward, reliable, easy to use, and flexible.



Work Psychology ppt

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