Problem SolvingPages 178-190

Information and Managerial Decisions

• The role of a manager is to LEAD, PLAN, ORGANIZE, CONTROL.

• One of their main jobs is to deal with problems.

• They have to use information to solve these problems.

Information and Managerial Decisions

• What do you think is the most common problem situation?

• Performance deficiencies

• Performance opportunities

• Dealing with these situations means problem solving. You have to identify and take action to resolve problems.

Types of Managerial Decisions

• Easiest kind of decisions that managers have to make are called programmed decisions.-There are solutions already available.-They deal with structured problems. These are straightforward and clear in information needs.

• More difficult decisions for a manager are for unstructured problems. This means there are ambiguities and information deficiencies.-These require non-programmed decisions.

Crisis

• A crisis is an unexpected problem that can lead to disaster if not resolved quickly and appropriately.-Name some things that could be crises?

• A lot of the time, managers become closed offfrom the rest of their teams and try to solve crisesthemselves.

Crisis

• Companies have increasingly been creating crisis management plans.-This is preparation for the management of crises that threaten an organization’s health and well-being.

Crisis Management

• 1. Figure out what is going on: Take the time to understand the situation, what’s happening, and the conditions under which the crisis must be resolved.

• 2. Remember that speed matters: Attack the crisis as quickly as possible, trying to catch it when it is as small as possible.

• 3. Remember that slow counts, too: Know when to back off and wait for a better opportunity to make progress with the crisis.

Crisis Management

• 4. Respect the danger of the unfamiliar: Understand that the most dangerous crisis is the all-new territory where you and others have never been before.

• 5. Value the skeptic: Don’t look for and get too comfortable with agreement; appreciate skeptics and let them help you to see things differently.

• 6. Be ready to “fight fire with fire”: When things are going wrong but others don’t seem to care, you may have to start a crisis of your own to get their attention.

Decisions Environments

• There are three main environments that managers have to consider when making plans.

• The first is the certain environment.-Any ideas?

Certain Environment

• Both the options and their outcomes are known to the manager.

• If an employee steals, the manager can A) Fire the employee, B) Make him pay it back, or C) do Nothing.

A) = Someone else must be hired.B) = He’ll be upset, still a threat to stealC) = We will think he’s gotten away with it. Will steal again.

Risk Environment

• Courses of actions and their outcomes are viewed as probabilities.

• Risk is a driver of success in business. If risks are not taken, it is rare to make a lot of money.

• This environment has some information. Managers are forced to make decisions on incomplete information.

Risk Environment

Redbox...

Uncertain Environment

• This occurs when there is so much information missing it is almost impossible to create probabilities.

• Managers must be creative. Sometimes, the solution is something that has never been tried before.

• Like…

Uncertain Environment…how about Space?

• Apollo 13

Problem-Solving Styles

Problem AvoidersProblem Solvers

Problem Seekers

Types of Thinking• Systematic Thinking – Approaches problems in a rational, step-by-step,

and analytical way. -Breaks a complicated problem into little pieces and solves each one one-by-one.

• Intuitive Thinking – Is more flexible and spontaneous, usually creative.-We can respond imaginatively.-Look at the whole problem and deal with many parts at once.-Managers can use their experience or new ideas. Hunches are played.

Types of Thinking

• Top Level Managers need to be able to deal with a lot of problems all at once. They have to know how each affects the other, and know their impact in the short- and long-term. This is called multidimensional thinking.

• Strategic Opportunism is the ability to remain focused on long-term objectives while being flexible enough to resolve short-term problems and opportunities in a timely manner.