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2006 Thomson-Wadsworth

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Learning Objectives

Define decision making. Describe how critical thinking skills

are used in decision making. State how decisions relate to

problem solving. Describe each step in the decision-

making process.

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Learning Objectives

Differentiate between structured andunstructured problems, and between

programmed and non-programmeddecisions. Describe the different styles used by

managers for decision making. Discuss how ambiguity, rationality, and

intuition influence decision making.

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Learning Objectives

Identify the relationship betweendecision making and risk.

List the advantages anddisadvantages of group decisionmaking.

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The Process of Making

Decisions Decision-Making Process

The logical, stepwise approach that is used

to make a choice between options, to solvea problem, or to resolve a dilemma. Contingency Planning

Anticipation of the need to make a decision

some time in the future and making thedecision in advance so that it can beimplemented in a timely manner at the timeit is needed.

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Decisions

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Decisions Problem Identification

The first step in the decision-makingprocess; the act of finding a problemand acknowledging that it exists.

Problem - A difference between whatis and what should be.

ex: nutrient analysis software inclinical nutrition dept. needs upgrade

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Decisions Criteria for decision making

Establish Decision-MakingCriteria - The second step in thedecision-making process; determiningwhich factors will have the mostrelevance in solving a given problem.

ex: list required and desired specs.for nutrient analysis software

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Decisions Weighting criteria

Weighting the Decision-MakingCriteria - The third step in thedecision-making process; assigningeach established criterion a ranking interms of importance to the decisionthat is to be made.

ex: Table 4.2...

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Decisions Developing alternatives

Identify the Alternatives - Thefourth step in the decision-makingprocess; the act of determining thedifferent options available to solvethe problem at hand.

ex: research available softwarepackages

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Decisions Analysis of alternatives

Analyze the Alternatives - The fifth

step in the decision-making process;the process of comparing andexamining the alternatives availableby measuring them against the same

standards, using only relevantcriteria. ex: quantified analysis in Table 4.3...

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Decisions Choosing an alternative

Making the Decision - The sixth stepin the decision-making process;involves choosing which alternative(s)will best solve the problem based onthe analysis that has been done.

ex: choose software package topurchase (Option C from Table 4.3)

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Decisions Implementing the decision

Implement the Decision - The

seventh step in the decision-makingprocess; the act of carrying out thedecision that has been made; ofteninvolves communicating exactly what

is to happen based on the decision. ex: purchase and install software, traindietitians to use it, enter data, etc.

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Decisions Evaluation

The eighth and last step of the

decision-making process; receivingfeedback about the decision that hasbeen implemented

Was it effective, efficient, appropriate,

and adequate? ex: Did the software upgrade improve

efficiency, quality patient service, etc.?

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Types of Decisions

Structured problems and programmeddecisions

Structured Problem - A discrepancybetween what is and what should be that isboth routine and predictable.

Programmed Decisions - Decisions thatare made routinely, often relying on

precedent, in which information can betransferred from one similar situation to thenext; usually used to solve structuredproblems.

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Types of Decisions

Structured problems andprogrammed decisions

Programmable Decisions -Decisions that, though not yetprogrammed, are of the routine typethat can be programmed.

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Types of Decisions

Unstructured problems andnonprogrammed decisions

Unstructured Problem - A discrepancybetween what is and what should be that isnew, unusual, and often unpredictable.

Nonprogrammed Decisions - Decisions

that are used to resolve unstructuredproblems; these decisions require muchresearch and thought.

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Types of Decisions

Unstructured problems andnonprogrammed decisions

Institutional Memory - Thehistorical precedent of anorganization that can be used in thedecision-making process.

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Types of Decisions

Managerial levels and decisionmaking

Type of decision made by a managercorrelates with his/her managementlevel

Most nonprogrammed decisions aremade by upper-level managers

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Decision-Making Styles

Problem Avoider A decision-making style in which the

person does not recognize a problemor chooses to avoid it; one who maymake the choice not to make adecision.

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Problem Solver A decision-making style in which the person

recognizes existing problems and deals withthem in a timely manner.

Reactive - A characteristic of a problemsolver who acts on problems after theyhave become obvious.

Problem Seeker A decision-making style in which the person

is proactive and deals with potentialproblems before they become obvious.

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Ambiguity versus rationality Directive Decision Maker - A type of

decision maker characterized by beingefficient and logical, requiring littleinformation to make a decision, looking atfew alternatives, and exhibiting a lowtolerance for ambiguity.

Conceptual Decision Maker - A type ofdecision maker characterized by being opento new ideas, looking at many alternatives,having a high tolerance for ambiguity, andrelying on instinct versus logic and reason.

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Ambiguity versus rationality Analytic Decision Maker - A type of

decision maker who enjoys solvingproblems, likes to seek alternatives andinformation, can tolerate ambiguity, andapplies a rational, methodical approach tosolve problems.

Behavioral Decision Maker - A type ofdecision maker who uses intuition, feelings,and perceptions versus actual data, andwho dislikes ambiguity.

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Risk in Decision Making

Certainty A situation in which the outcome of a

decision is known and expected. Risk

The unknown or uncertain factors oroutcomes involved in making a decision.

Uncertainty A situation in which the outcomes of a

decision cannot be predicted with anydegree of accuracy.

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Group Decision Making

Accommodation A situation in which members of a

group feel that they have to acceptthe position of the dominant memberof the group.

De Facto Decisions Decisions that are made passivelywith no obvious objections expressed.

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Groupthink A characteristic of groups that

evolves when the cohesiveness of thegroup becomes more important thanthe problem that needs to be solved.

In this situation, members feel loyal

to each other and may not want to jeopardize this unity by expressingopposing opinions.

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Risk in group decision making Shared risk = more willingness to

take risks. Information pool is larger.

Maximizing group decision making Brainstorming - The informal

process of tackling a given problemby contributing as many ideas aspossible without analysis or criticism.

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Maximizing group decision making Nominal Group Technique A

methodical, rational approach to making agroup decision in which each membercontributes ideas, and alternatives areranked to deduce a sensible, fair decision.

Delphi Technique - An approach tocoming up with a group decision similar tothe nominal group technique except thatmembers do not meet but insteadcommunicate and analyze ideas throughwritten communication until consensus is

reached.

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Conclusion

Decision making is an eight-stepprocess that includes problemidentification, establishment andweighting of criteria, development andanalysis of alternatives, making thedecision, implementing it, and followingup.

Structured problems requireprogrammed or programmabledecisions; unstructured problemsrequire nonprogrammed decisions.

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Conclusion

Different levels of managers tend tomake different types of decisions.

Managers develop personal decision-making styles that can be describedusing one or more of the followingterms: avoidance, reactive, proactive,directive, conceptual, analytic, andbehavioral.

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Conclusion

There are distinct advantages anddisadvantages to group decision

making; techniques are availableto maximize the group decision-making process.

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Reality Check Decision

Clusters Many decisions may cluster around

a particular problem Making one decision may trigger aseries of other decisions ex: Reduce spending on oral and

enteral supplements in a smallcommunity hospital/skilled nursingfacility.

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