Presentation Slidesto Accompany
Organizational Behavior 10th EditionDon Hellriegel and John W. Slocum, Jr.
Chapter 13—Making Decisions in Organizations
Chapter 13: Making Decisions in Organzations
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Slide 13.1Learning Objectives for
Making Decisions in Organizations
Explain the basic concepts for making ethical decisions
Describe the attributes of three models of managerial decision making
Explain two methods for stimulating organizational creativity
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Slide 13.2Components of the Foundation for
Making Ethical Decisions
Ethical intensity
Decision-making principles and
decision rules
Affected individuals
Benefits and costs
Determination of rights
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Slide 13.3Components of Ethical Intensity
Magnitude of consequences
Probability of effect
Social consensus
Temporal immediacy
Proximity
Concentration of effect
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Slide 13.4Ethical Principles That Justify
Self-Serving Behaviors and Decisions
Hedonist principle Do whatever you find to be in your own self-
interest but do nothing that is clearly illegal
Might-equals-right principle Do whatever you are powerful enough to
impose without respect to socially acceptable
behaviors but do nothing that is clearly illegal
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Slide 13.4 (continued)Ethical Principles That Justify
Self-Serving Behaviors and Decisions
Organization interests principle Act on the basis of what is good for the
organization but do nothing that is clearly
illegal
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Slide 13.5Ethical Principles That Focus on
Balancing Multiple Interests Means–end principle
Act on the basis of whether some overall good
justifies any moral transgression but do
nothing that is clearly illegal
Utilitarian principle Act on the basis of whether the harm from a
decision is outweighed by the good in it but do
nothing that is clearly illegal
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Slide 13.5 (continued)Ethical Principles That Focus on
Balancing Multiple Interests
Professional standards principle Act on the basis of whether the decision can
be explained before a group of your peers but
do nothing that is clearly illegal
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Slide 13.6Ethical Principles That ConsiderAffected Parties and the Public
Disclosure principle Act on the basis of how the general public
would likely respond to disclosure of the rationale and facts related to the decision but do nothing that is clearly illegal
Distributive justice principle Act on the basis of treating an individual or
group equitably rather than on arbitrarily defined characteristics but do nothing that is clearly illegal
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Slide 13.6(continued)Ethical Principles That ConsiderAffected Parties and the Public
Golden rule principle Act on the basis of placing yourself in the
position of someone affected by the decision and try to determine how that person would feel but do nothing that is clearly illegal
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Slide 13.7Guidelines for Integrating Ethical Decision Making into the Organization’s Daily Life
Top management should commit to and model ethical
behavior
Develop a code of ethics and follow it
Have procedures for organization members to report
unethical behavior
Involve managers and employees in identifying and solving
ethical problems
Include ethics in performance appraisal
Publicize the organization’s ethical orientation
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Slide 13.8Explicit Assumptions of
the Rational Model
All available information on alternatives has
been obtained
Alternatives can be ranked according to
explicit criteria
The alternative selected will provide the
maximum gain
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Slide 13.9Implicit Assumptions of
the Rational Model
Ethical dilemmas do not exist in the decision-
making process
The means–end principle and the utilitarian
principles will dominate the consideration of
ethical issues
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Slide 13.10Portion of Xerox’s Rational Decision
Process
1. Identify and select problem What do we want to change? Identification of the gap;describe “desired state”
Key cause(s) documentedand ranked
Solution list
Make change plan; establishmeasurement criteria
Solution in place
Solution verification; dealwith continuing problems
STEPQUESTION TO BE ANSWERED
WHAT’S NEEDED TO GO TO NEXT STEP
What’s preventing us fromreaching the “desired state”?
How could change be made?
What’s the best way to do it?
Are we following the plan?
Source: Adapted from Garvin, D. A. Building a learning organization. Harvard Business Review, July-August 1993, 78-91; Brown, J. S., and Walton, E. Reenacting the corporation: Organizational change and restructuring of Xerox Planning Review, September/October 1993, 5-8.
How well did it work?
2. Analyze problem
3. Generate potential solutions
4. Select and plan the solution
5. Implement the solution
6. Evaluate the solution
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Slide 13.11Bounded Rationality Model
Bounded Rationality
LimitedSearch
InadequateInformationand Control
DecisionsSatisficing
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Slide 13.12Political Model of Decision Making
Describes decision making by individuals to satisfy their own interests
All aspects of the decision-making process are merely methods to tilt decision outcomes in the decision maker’s favor
Decision outcomes are affected by the distribution of power and the effectiveness of the tactics used by participants
Doesn’t explicitly consider ethical dilemmas but often draws on the hedonistic principle and the might-equals-right principle
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Slide 13.13Influence Strategies Rational persuasion Inspirational appeal Consultation Ingratiation Exchange Personal appeal Coalition Legitimating Pressure
Source: Adapted from Yukl, G., Guinan, P. J., and Sottolano, D. Influence tactics used for differentobjectives with subordinates, peers, and superiors. Group & Organization Management, 1995, 20, 275;Buchanan, D., and Badham, R. Power, Politics and Organizational Change. London: Sage, 1999, 64.
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Slide 13.14Barriers to Creativity and Innovation
Perceptual blocks Failure to use all the senses in observing Failure to investigate the obvious Difficulty in seeing remote relationships Failure to distinguish between cause and effect
Cultural blocks Desire to conform to established norms Overemphasis on competition or conflict
avoidance Drive to be practical and to economize Disbelief in the value of open-ended exploration
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Slide 13.14 (continued)Barriers to Creativity and Innovation
Emotional blocks Fear of making a mistake
Fear and distrust of others
Latching on to the first idea
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Slide 13.15Characteristics of Lateral Versus
Vertical Thinking
Finds new ways to view things; concerned with change and movement.
Looks for what is different rather than “right” or “wrong.”
Analyzes ideas to generate new ideas.
Uses free association thinking. Welcomes chance intrusions of
information; considers the irrelevant.
Progresses by avoiding the obvious.
Tries to find absolutes; concerned with stability.
Seeks justification for each step; tries to find what is “right.”
Analyzes ideas for faults. Seeks continuity. Selectively chooses information
to consider; rejects irrelevant information.
Progresses using established patterns; considers the obvious.
LATERAL THINKING VERTICAL THINKING
Source: Based on de Bono, E. Lateral Thinking: Creativity Step by Step. New York:Harper & Row, 1970; de Bono, E. Six Thinking Hats. Boston: Little, Brown, 1985.
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Slide 13.16Useful Lateral Thinking Techniques
Reversal technique Examining a problem and turning it completely around,
inside out, or upside down
Analogy technique Developing a statement about similarities between
objects, persons, and situations
Cross-fertilization technique Asking experts from other fields to examine the problem
and suggest solutions from their own areas of expertise
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Slide 13.17Decision Making with a Devil’s Advocate
A proposed course of action
is generated.
A devil’s advocate is assigned to criticize the
proposal.
A critique is presented to key decision makers.
The decision is monitored.
The decision to adopt, modify, or discontinue the
proposed course of action is taken.
Any additional information relevant to
the issues is generated.
Source: Adapted from Cosier, R. A., and Schrivenk, C. R. Agreement and thinking alike:Ingredients for poor decisions. Academy of Management, February 1991, 71.
Repeat process, if needed.
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