Managers make decisions constantly, but not every decision needs the same amount of time or analysis. This lesson introduces ways to improve individual decision-making and explains how experience helps managers choose an appropriate approach.
A manager can improve decisions either by making them more quickly or by improving their quality. The appropriate goal depends on the decision.
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What is a programmed decision?
A routine, familiar decision that can usually be handled with established procedures, experience, or simple decision rules.
What is a nonprogrammed decision?
A novel, complex, or consequential decision that does not have an obvious routine solution and generally benefits from systematic analysis.
How does experience support decision-making?
Experience builds expertise and pattern recognition, helps managers use suitable shortcuts for routine choices, and helps them identify information needed for unfamiliar choices.
What is a heuristic?
A mental shortcut or practical rule of thumb that can help a manager make a routine decision more quickly.
How should decision effort be allocated?
Use a level of time and analysis proportionate to the decision's importance, uncertainty, and possible consequences.
Quiz questions
Which description best fits a programmed decision?Answer: A familiar choice that can often use established procedures.
What characterizes evidence-based decision-making?Answer: Using the best available evidence to support an effective choice.
What is an ad hominem fallacy?Answer: Attacking the speaker instead of evaluating the argument.
Why should managers avoid relying on experience alone?Answer: Past patterns may not fit changed circumstances.
What does recognizing the need to decide involve?Answer: Identifying an issue that calls for action without rushing to a solution.
Based on Principles of Management by David S. Bright, Anastasia H. Cortes, Eva Hartmann, K. Praveen Parboteeah, Jon L. Pierce, Monique Reece, Amit Shah, Siri Terjesen, Joseph Weiss, Margaret A. White, Donald G. Gardner, Jason Lambert et al. (OpenStax), licensed CC BY 4.0. Adapted into a summary, flashcards and quizzes.