Week 5

Managing Information and

Decision-Making

(Theme: Managing)
Key question for this theme: What do managers do, and how do I
become a good manager?

Main Source: Schermerhorn (2020), Chapter 7,8

 TYPES OF PROBLEMS

Structured problems are ones that are familiar,

straightforward, and clear with respect to
information needs
 Programmed decisions apply solutions that are
readily available from past experiences to solve
structured problems.

Unstructured problems are ones that are full of

ambiguities and information deficiencies
 Non-programmed decisions apply a specific
solution to meet the demands of a unique
problem. Commonly faced by higher-level
management

Copyright ©2015 John Wiley & Sons, Inc.

 Systematic versus intuitive thinking

Systematic Intuitive
thinking thinking
• approaches • approaches
problems in a problems in a
rational, step-by- flexible and
step, and spontaneous
analytical fashion fashion

Effective thinking applies both

intuitive and systematic
thinking
STEPS IN THE DECISION MAKING PROCESS

1. Identify and define the problem

2. Generate and evaluate alternative solutions
3. Choose a preferred course of action
4. Implementation of alternatives
5. Evaluation of decision effectiveness
6
AT ALL STEPS, CHECK ETHICAL REASONING!

Utility • Does the decision satisfy all

constituents or stakeholders?

Rights • Does the decision respect the

rights and duties of everyone?

Justice • Is the decision consistent with

the principles of justice?

Caring • Is the decision consistent with

my responsibilities to care?

Copyright ©2015 John Wiley & Sons, Inc.

 The real challenge for executives who want to
implement decision quality control is not time or cost.
It is the need to build awareness that even highly
experienced, superbly competent, and well-
intentioned managers are fallible.

Organisations need to realise that a disciplined

decision-making process, not individual genius, is
the key to a sound strategy. And they will have to
create a culture of open debate in which such
processes can flourish.

Source: Kahneman, Lovallo, & Sibony (2011). Before you make that decision, Harvard Business Review, June, 51-60.
 The roles of planning and controlling
in the management process

Planning : defining the organisation’s goals, establishing strategies for achieving those
goals, and developing plans to integrate and coordinate work activities.
 WHY DO MANAGERS PLAN?

1. Provides direction – goals

2. Reduces uncertainty –
anticipate changes and
develop responses
3. Minimises waste and
redundancy – means and
ends clearer
4. Establishes goals/standards
for controlling – how did we
do?
 Types of Plans Used by Managers
Long terms plans vs short term plans?

 Long-term plans look three or more years into the future

 Short-term plans typically cover one year or less

Copyright ©2015 John Wiley & Sons, Inc.

 TYPES OF PLANS USED BY MANAGERS

 Strategic plans — set broad, comprehensive, and longer-

term action directions for the entire organisation. Vision
clarifies purpose of the organisation and what it hopes to be
in the future.
 Tactical plan – helps to implement all or parts of the
strategic plan. It takes the form of functional plans that
indicate how different operations within the organisation will
help accomplish the overall strategy
 Production plans
 Financial plans
 Facilities plans
 Logistics plans
 Marketing plans
 Human resource plans