Chapter 5

Problem Solving and

Decision Making
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Steps in Problem Solving

and Decision Making
Identify and
Diagnose
Problem
Choose One
Alternative
Solution

Develop
Alternative
Solutions

Implement
the
Decision

Evaluate
Alternative
Solutions

Evaluate and
Control

Bounded Rationality

People usually do not make entirely

rational decisions (they are bounded).
People do the best with what they
have in making decisions.
Decision makers often look for
satisficing decisions (just suffice).
People often use heuristics, or
simplified strategies (rules of thumb).
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Influences on Decision
Making

Intuition (experience helps)

Personality (such as perfectionism)
and cognitive intelligence
Emotional intelligence (includes selfawareness and self-management)
Quality and accessibility of
information
Political considerations
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Influences on Decision
Making, continued
Degree of certainty (certainty,
risk, uncertainty)
Values of the decision maker
(such as desire for status quo,
interest in human welfare)
Procrastination (can lead to
indecisiveness and inaction)

Decision-Making Styles
1.

2.

3.

4.

Decisive (one option, less

information)
Flexible (many options, less
information)
Hierarchic (one option, more
information)
Integrative (many options, more
information)
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Nominal Group
Technique
1.
2.
3.
4.

5.
6.

Gather the group.

Leader presents a specific question.
Members write down ideas alone.
Each participant presents one idea to
the group on computer or flip-chart.
Group clarifies, evaluates alternatives.
Alternatives are rated independently
and votes tallied to choose best one.
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The Creative
Personality
Emotionally open and flexible
Breaks the rules, and can be a
maverick
Emphasizes lateral rather than
vertical thinking
Willing to support unusual idea
world is not ready to accept

Conditions Necessary
for Creativity

Expertise (knowledge to put facts

together)
Creative-thinking skills and internal
motivation
Environmental need plus conflict
and tension
Encouragement from others
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The Creative and

Innovative Organization
1.

2.

3.
4.
5.

Challenge (right type and

amount)
Freedom (to choose how to
reach goal)
Resources (time and money)
Organizational support (rewards)
Greater diversity in groups
10

Organizational Programs
for Improving Creativity
Creativity training
Brainstorming
Systematically gathering ideas
Appropriate physical
surroundings (encouragement of
interaction, and even natural
light)

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Creativity-Building
Suggestions
1.
2.
3.
4.
5.

6.

Keep track of your ideas.

Stay current in your field.
Improve your sense of humor.
Adopt a risk-taking attitude.
Identify your best times for
creativity.
Step back when facing idea block.
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