Management Organisational Behaviour 2 e Chapter 12 Ethical
Management & Organisational Behaviour 2 e Chapter 12 Ethical Problem Solving and Decision Making ©The Mc. Graw-Hill Companies, 2005
Problem Solving The process of eliminating the discrepancy between the actual and desired outcomes. 1 ©The Mc. Graw-Hill Companies, 2005
Decision Making The step in the problem-solving process that entails choosing the best solution from several alternatives. 2 ©The Mc. Graw-Hill Companies, 2005
The Rational Problem-Solving Process § § § Problem Awareness Problem Definition Problem Solving 3 ©The Mc. Graw-Hill Companies, 2005
Problem Awareness • • Establish trust Clarify objectives Assess the current situation Identify problems 4 ©The Mc. Graw-Hill Companies, 2005
Problem Definition • • Analyse problems Agree on problems to be solved 5 ©The Mc. Graw-Hill Companies, 2005
Decision Making • • Establish decision-making criteria. Develop action alternatives. Evaluate alternatives. Decide on a plan. 6 ©The Mc. Graw-Hill Companies, 2005
The Rational Problem-Solving Process • • Action Plan Implementation Follow-Through 7 ©The Mc. Graw-Hill Companies, 2005
Action Plan Implementation • • Assign tasks and responsibilities Establish an implementation schedule Reinforce commitment Activate the plan 8 ©The Mc. Graw-Hill Companies, 2005
Follow-through • Establish criteria for success • Determine how to measure performance • Monitor the results • Take corrective action 9 ©The Mc. Graw-Hill Companies, 2005
Exhibit 12 -3: Cause-and Effect Diagram Cause and Effect for Poor Print Quality Material Machines Ribbon Interface wrong n t ou e ok br rn wo Wrong paper Circuit board Printhead d ate ck he stu er pin ov Effect Print is hard to read Paper in wrong path Exceeds duty cycle Poor training Preventive maintenance omitted No access to instructions 10 ©The Mc. Graw-Hill Companies, 2005
Exhibit 12 -4: Pareto Chart No. of Complaints 42% of All Complaints 25 20 15 10 5 0 Shipping Installation Delivery Clerical 11 Misc. ©The Mc. Graw-Hill Companies, 2005
Establish Decision-Making Criteria • Statements of objectives that need to be met for a problem to be solved • Decision making criteria should be: - Specific, measurable, and attainable - Complementary - Ethical - Acceptable 12 ©The Mc. Graw-Hill Companies, 2005
Develop Action Alternatives • • Involving all parties at this stage will enhance the acceptance and value of the action plan. Solicit feedback. Ensure potential outcomes are understood. Assess readiness. Develop multiple solutions. Maintain flexibility. 13 ©The Mc. Graw-Hill Companies, 2005
Benefits & Risks of Alternatives Calculate for each alternative: - The probability of success. - The degree of risk. 14 ©The Mc. Graw-Hill Companies, 2005
• Certainty exists if the exact results are known in advance. • Uncertainty exists when probabilities can not be determined. 15 ©The Mc. Graw-Hill Companies, 2005
• Known risk is a situation where specific alternative probabilities can be predicted. • Turbulence is a consequence of a rapidly changing environment. 16 ©The Mc. Graw-Hill Companies, 2005
Exhibit 12 -5: Decision-Making Grid Criteria Benefits Probability of Success Costs Risks Associated Consequences Timin g Alternative A Alternative B Alternative C 17 ©The Mc. Graw-Hill Companies, 2005
Action Plan Implementation • Assign Tasks & Responsibilities. • Establish an Implementation Schedule. • Follow Through. • Create criteria for measuring success. • Monitor the results. • Take corrective action if appropriate. 18 ©The Mc. Graw-Hill Companies, 2005
Decision Styles These are learned habits for processing decision-making information. Amount and focus of information processing • Maximiser • Satisficer Alternative development • Uni-focused • Multi-focused 19 ©The Mc. Graw-Hill Companies, 2005
Exhibit 12 -7 20 ©The Mc. Graw-Hill Companies, 2005
Decision Style Characteristics Focus Number of conclusions (Uni-Focus) Decisive Hierarchic Amount of Information Used (Minimizer) (Maximizer) Flexible Integrative 21 (Multi-Focus) ©The Mc. Graw-Hill Companies, 2005
Decisive • • • Fast Action Oriented Persistent Punctual Controlling Quantity 22 ©The Mc. Graw-Hill Companies, 2005
Hierarchic • • • Slow Thorough Logical Perfectionist Controlling Quality 23 ©The Mc. Graw-Hill Companies, 2005
Flexible • • • Fast Adaptable Open Action Oriented Sociable Intuitive 24 ©The Mc. Graw-Hill Companies, 2005
Integrative • • • Slow Adaptable Open Analytical Exploring Creative 25 ©The Mc. Graw-Hill Companies, 2005
Degrees of Decision Participation • Premise • Assumptions 26 ©The Mc. Graw-Hill Companies, 2005
Premise Effective leaders know when to involve subordinates in decision making. 27 ©The Mc. Graw-Hill Companies, 2005
Assumptions Leaders can change their decision styles; participation in decision making leads to commitment to that decision; and participation in structured decisions is wasteful. 28 ©The Mc. Graw-Hill Companies, 2005
• • • Exhibit 12 -8: Types of Participation in Decisions Autocratic II Consultative II Group II 29 ©The Mc. Graw-Hill Companies, 2005
Autocratic I The team leader solves the problem or makes the decision using the information that is available. 30 ©The Mc. Graw-Hill Companies, 2005
Autocratic II The team leader obtains needed information from the group and then makes the decision. The group may or may not be told about the nature of the problem or decision. 31 ©The Mc. Graw-Hill Companies, 2005
Consultative I Team leaders share the problem with members of the group individually. Information and suggestions are obtained but the leader makes the final decision. 32 ©The Mc. Graw-Hill Companies, 2005
Consultative II A team leader gets the group together and shares the problem. Ideas and suggestions are obtained from the team and the leader makes the final decision. 33 ©The Mc. Graw-Hill Companies, 2005
Group II The team leader tells the team about the problem. The group makes the decision by discussion and consensus. 34 ©The Mc. Graw-Hill Companies, 2005
Criteria for Participation in Decision Making • • Quality Requirements Acceptance Requirements Time Pressures Focus on Employee Development 35 ©The Mc. Graw-Hill Companies, 2005
Quality Requirements • • Problem structure Leader information 36 ©The Mc. Graw-Hill Companies, 2005
Acceptance Requirements • • • Subordinate commitment Subordinate information Subordinate goal orientation 37 ©The Mc. Graw-Hill Companies, 2005
Characteristics of Managers that Generate Creativity • • Willing to absorb risks. Can live with half-developed ideas. Will stretch normal policies. Good listeners. Don’t dwell on mistakes. Trust their intuition. Enthusiastic and invigorating. 38 ©The Mc. Graw-Hill Companies, 2005
Creative organisations • • Flexibility – time for thinking. Balanced guidance and freedom. Free and spontaneous communication. Freedom to fail. Employee development. Encourage self-actualisation. Rewards for creativity. Accept new ideas. 39 ©The Mc. Graw-Hill Companies, 2005
Less Creative Organisations • • • Rigidity. Deadline pressures. Emphasis on guidance. Formal Communication. Fear of failure. Proposals evaluated on basis of immediate payo Poor staff development. Discourage self-activities. Do not reward for creativity. Reject new ideas. 40 ©The Mc. Graw-Hill Companies, 2005
Ten Mental Blocks that Interfere with Creativity 1. Searching for the “right” answer. 2. Always trying to be logical. 3. Looking for solutions that “follow rules”. 4. Trying to be too practical. 5. Avoiding ambiguity. 6. Fearing failure. 7. Not playing or having fun at work. 8. Ignoring problems outside one’s specialty. 9. Not wanting to look foolish. 10. Believing you are not creative. 41 ©The Mc. Graw-Hill Companies, 2005
Brainstorming Rules 42 ©The Mc. Graw-Hill Companies, 2005
Nominal Group Technique • • • Participants meet in highly structured format Independent analysis of problem Presentation of results to group Group ranks various proposals Highest ranking becomes group decision Involves multiple idea generation 43 ©The Mc. Graw-Hill Companies, 2005
Delphi Technique • • • Participants do not meet Individual brainstorming Suggestions are compiled Additional analysis takes place Involves pooling of ideas, viewpoints, and independent feedback at minimum expense 44 ©The Mc. Graw-Hill Companies, 2005
Cultural Differences and the Rational Problem-Solving Process Potential Cultural Reactions • High-control or doing cultures. • Low-control or being cultures. • High power distance. • Low power distance. 45 ©The Mc. Graw-Hill Companies, 2005
Cultural Differences and the Rational Problem-Solving Process Problem Definition • High tolerance for ambiguity cultures. • Low tolerance for ambiguity cultures. • High affect cultures. • Neutral cultures. 46 ©The Mc. Graw-Hill Companies, 2005
Cultural Differences and the Rational Problem-Solving Process Decision Making • Universalistic cultures • Particularistic (or personal-obligation) cultures • Individualistic cultures • Collectivistic cultures 47 ©The Mc. Graw-Hill Companies, 2005
Cultural Differences and the Rational Problem-Solving Process Action Plan Implementation • High power distance. • Low power distance. • High-control or doing cultures. • Low-control or being cultures. 48 ©The Mc. Graw-Hill Companies, 2005
Cultural Differences and the Rational Problem-Solving Process Follow-through • Universalistic (or rules-oriented) cultures. • Particularistic (or personal-obligation) cultures. • Quality of Life cultures. • Career Success cultures. 49 ©The Mc. Graw-Hill Companies, 2005
Summary • The rational problem-solving process includes identifying the problem, clarifying objectives, analysing alternatives, deciding on a solution, implementing the solution, and following through to ensure its effectiveness. • To begin solving a problem, the current situation needs to be diagnosed to understand define the problem as accurately as possible. Hasty assumptions often contribute to a failure to distinguish a problem’s symptoms from its sources. • The immediate and long-term effects of all alternative solutions on other people and situations should be considered. 50 ©The Mc. Graw-Hill Companies, 2005
Summary continued 1 • Effective action plans contain measurable criteria and time lines. Involving the people affected by the plan in the analysis of alternatives and in decisionmaking will build their commitment to its implementation. • When evaluating action plan alternatives, benefits are weighed against possible negative consequences. • Other considerations include probability of success; associated risk factors; potential money, time, and energy costs; and the possible reactions of those affected. 51 ©The Mc. Graw-Hill Companies, 2005
Summary continued 2 • Effective implementation of an action plan depends on the parties’ commitment to make it work. • Commitment to the agreed-upon solution is usually gained when problems, needs and objectives are identified mutually, and solutions are reached through the participation and consensus of all involved. • Specific tasks and responsibilities are assigned, schedules are established, and personal commitment is reinforced as the plan is activated. 52 ©The Mc. Graw-Hill Companies, 2005
Summary continued 3 • The follow-through process involves the development of procedures to monitor and assist the implementation of the new action plan. • A control process is applied to measure performance, monitor results, and take corrective actions when needed. 53 ©The Mc. Graw-Hill Companies, 2005
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