EXAM TWO OBJECTIVES (FROM THE NOTES & OUTSIDE READING)
1. Is decision-making a function of management?
• No, it’s a part of all functions
• Mostly associated with planning
2. Why do we make decisions as managers?
• To accomplish goals more efficiently
3. What’s the difference between programmed and non-programmed decisions? • Programmed: specific procedures developed for repetitive and routine problems o More, 1st line; rule or standard operating procedure used in making the decisions o Very little thought
o Every programmed started off as non-programmed o Greater efficiency
• Non-programmed: specific to management problems that are noval (new) and unique [different and hard to understand] o Top managers
o Novel, unique, complex, unstructured, new, different, no set way o Weigh decision out in your mind
4. Do managers make more programmed or non-programmed decisions, in general? • Programmed which makes us more efficient
5. What is decision-making under conditions of CERTAINTY?
• Managers know all available alternatives & the outcomes associated with each • 100% probability (certain)
• Least common
6. What is decision-making under conditions of RISK?
• Lack of certainty regarding outcomes of various alternatives, but an awareness of probabilities associated with their occurrence • Alternatives are known, but outcomes are in doubt
• Probability between 0 &100%
7. What is decision-making under conditions of UNCERTAINTY?
• Don’t know alternatives, outcomes, or the probability of the outcomes occurrence
8. Which decision-making condition is most common? Least common? Most difficult? • Most common= risk, probabilities 0-100%
• Least common= certainty 100% probabilities
• Most difficult=...