Fdome IO-G2A Module 2 ( Synchro Students) PDF

Preview

Summary

......

Description

IO G2A-DECISION MAKING COURSE/SUBJECT: IO-G2A_GUIDANCE 2A: DECISION MAKING MODULE NO: 2 MODULE TITLE: FOLLOWING MY PATH THROUGH MY DECISIONS WRITER: SONNY T. SALLENA -------------------------------------------------------------------------------------------------------------------------------

THE DOMINICAN BLESSING May God the Father bless us, May God the Son heal us, May the Holy Spirit enlighten us and give us eyes to see with, ears to hear with, and hands to do the work of God with, feet to walk with, and a mouth to preach the word of salvation with, and the angel of peace to watch over us and lead us at last, by our Lord‘s gift, to the kingdom. Amen.

---------------------------------------------------------------------------------------------------GENERAL INSTRUCTIONS Create a separate document/file to answer the module activities including the processing questions. Do not forget to write your name and program as well the activity number (i.e. Activity 1, Activity 2, Activity 3…etc) for each. DO NOT USE RED AS YOUR FONT COLOR. Convert the document/file into PDF format. ---------------------------------------------------------------------------------------------------Module Introduction and Focus Question(s): Decision-making is regarded as the cognitive process resulting in the selection of a belief or a course of action among several possible alternative options. Decision-making is the process of identifying and choosing alternatives based on the values, preferences and beliefs of the decision-maker. Every decision-making process produces a final choice, which may or may not prompt action. What makes a decision necessary? What are my options? What are the likely consequences of each option? How important are the consequences? Which option is best in light of the consequences?

IO G2A-DECISION MAKING STUDY

Have you ever wonder why there are people who are good in decision making while some have difficulty in making or coming-up with their own decisions? Do you think that decision making is really needed or you will just let others decide for your own? Do you really believe that being a good decision maker will really help you by achieving what you really want for your life and for the people around you? Decision-making can be regarded as a problem-solving activity yielding a solution deemed to be optimal, or at least satisfactory. It is therefore a process which can be more or less rational or irrational and can be based on explicit or tacit knowledge and beliefs. Tacit knowledge is often used to fill the gaps in complex decision making processes. Usually both of these types of knowledge, tacit and explicit, are used together in the decision-making process.

PERSPECTIVE ON DECISION MAKING There are two perspectives on decision making: (a) from the decision-making perspective, values, rules and knowledge are independent sets of variables and constraints to be considered when selecting an option; (b) from the decision-context perspective, values, rules and knowledge are interconnected systems that define a decision process and enable the construction and evaluation of options. Interactions between values, rules, and knowledge systems limit the set of practical or permissible options; the types of values, rules, and knowledge that can influence the decision and the potential for change in the decision context.

IO G2A-DECISION MAKING

Values are the set of ethical precepts that determine the way people select actions and evaluate events. Rules are both rules-in-use (norms, practices, habits, heuristics) and rules-in-form (regulations, laws, directives). Knowledge is both evidence-based (scientific and technical) knowledge and experiential knowledge. Decision context is the subset of interacting subsystems that are at play in a particular decision process. One core idea is that the decision context may exclude relevant values, knowledge or rules from being considered in decisions. Adaptation may therefore involve change in the decision context.

IMPACTS OF DECISION MAKING Decision making is a key element of the success of a business, and dealing with the positive and negative effects is a matter of necessity. It is important to understand that decision making is not a one-time event, but a collaborative process that is intended to bring multiple

IO G2A-DECISION MAKING perspectives to the table for open discussion. A decision made in isolation has a high probability of being misguided and too narrow in scope. The effects of good decision making change the world around us. From deciding not to buy bottled water to combatting slavery and oppression, the values we have shape the decisions we make, and the decisions we make shape the world we live in. Making good decisions in your life is a critical skill, in our good decision making guide we cover in detail the many ways we can improve our decision making for better outcomes in life and work. How Can a Decision Impact Others? There is always a chain of events associated with everything that we do. The bigger the decision, the more life-changing the chain of events will be. If you are in an abusive or disrespectful relationship, making a clear choice to leave will have lasting consequences. It will impact your mental health and self-esteem. It will affect your living arrangements, your finances, even your circle of friends. Some of these events will be positive or negative. While your finances may take a hit, your self-esteem may get a boost. Your circle of friends may reduce, but your freedom and independence to make new relationships will increase. Remember, in every chain of events; you will also have many future decision points upon which to act to positively impact your life. Map out the chain of events to help you feel more comfortable with the decision. What most people do not realize is that every major decision leads inexorably to a chain of events we cannot accurately predict. Those chains of events can be positive or negative. If we make good decisions, the outcomes should be positive; if we make poor choices, the outcomes can be negative.

FACTORS THAT INFLUENCE DECISION MAKING

IO G2A-DECISION MAKING PERSONAL FACTORS  Personal Demographics: age, gender, stages in life cycle, education, occupation, economic status/position, etc.  Personal Psychographics: includes lifestyle, attitudes, self-concept, concern about status, value systems, beliefs, etc. CULTURAL FACTORS  Culture: combine resulted of factors like religion, traditions, taboos, language, education, upbringing, established pattern of social behaviour, values.  Sub-culture: Caste  Social Class: it is determined by educational level, wealth, occupation, profession & designation, location or residence, values and behavious. SOCIAL FACTORS  Intimate Groups: family, friends, peer groups, close colleagues and close knit organizations  Secondary Groups: based on an occupation, profession place of residence. INFORMATION  Information should be authentic, reliable, and adequate and must be available at time.  It reduces the uncertainty  Too much information over-load creates confusion and delay in decision making. PSYCHOLOGICAL FACTORS  Motivation: it all begins with needs  Perception: According to consistency theory, one mostly listen to things that support one‘s existing belief system.  Learning Process: People do change their beliefs, faiths, likes & dislikes which happens through learning.  Memory Process: Include past experiences even the hearsay experiences. Every day, people are inundated with decisions, big and small. Understanding how people arrive at their choices is an area of cognitive psychology that has received attention. Theories have been generated to explain how people make decisions, and what types of factors influence decision making in the present and future. In addition, heuristics have been researched to understand the decision making process. Several factors influence decision making. These factors, including past experience (Juliusson, Karlsson, & Gӓrling, 2005), cognitive biases (Stanovich & West, 2008), age and individual differences (Bruin, Parker, & Fischoff, 2007), belief in personal relevance (Acevedo, & Krueger, 2004), and an escalation of commitment, influence what choices people make. Understanding the factors that influence decision making process is important to understanding what decisions are made. That is, the factors that influence the process may impact the outcomes.

IO G2A-DECISION MAKING

People make decisions about many things. They make political decisions; personal decisions, including medical choices, romantic decisions, and career decisions; and financial decisions, which may also include some of the other kinds of decisions and judgments. Quite often, the decision making process is fairly specific to the decision being made. Some choices are simple and seem straight forward, while others are complex and require a multi-step approach to making the decisions. There are several important factors that influence decision making. Significant factors include past experiences, a variety of cognitive biases, an escalation of commitment and sunk outcomes, individual differences, including age and socioeconomic status, and a belief in personal relevance. These things all impact the decision making process and the decisions made. Past experiences can impact future decision making. Juliusson, Karlsson, and Garling (2005) indicated past decisions influence the decisions people make in the future. It stands to reason that when something positive results from a decision, people are more likely to decide in a similar way, given a similar situation. On the other hand, people tend to avoid repeating past mistakes (Sagi, & Friedland, 2007). This is significant to the extent that future decisions made based on past experiences are not necessarily the best decisions. In financial decision making, highly successful people do not make investment decisions based on past sunk outcomes, rather by examining choices with no regard for past experiences; this approach conflicts with what one may expect (Juliusson et al., 2005). In addition to past experiences and cognitive biases, decision making may be influenced by an escalation of commitment and sunk outcomes, which are unrecoverable costs. Juliusson, Karlsson, and Garling (2005) concluded people make decisions based on an irrational escalation of commitment, that is, individuals invest larger amounts of time, money, and effort into a decision to which they feel committed; further, people will tend to continue to make risky decisions when they feel responsible for the sunk costs, time, money, and effort spent on a

IO G2A-DECISION MAKING project. As a result, decision making may at times be influenced by ‗how far in the hole‘ the individual feels he or she is (Juliusson et al., 2005). Over and above past experiences, cognitive biases, and individual differences; another influence on decision making is the belief in personal relevance. When people believe what they decide matters, they are more likely to make a decision. Acevedo and Krueger (2004) examined individuals‘ voting patterns, and concluded that people will vote more readily when they believe their opinion is indicative of the attitudes of the general population, as well as when they have a regard for their own importance in the outcomes. People vote when they believe their vote counts. Acevedo and Krueger pointed out this voting phenomenon is ironic; when more people vote, the individual votes countless, in electoral math. After a decision is made, people experience a variety of reactions. In addition, present decisions influence future decision making. Several of the outcomes that may result from a decision are regret or satisfaction; both of which influence upcoming decisions. Regret, feelings of disappointment or dissatisfaction with a choice made is one potential outcome of decision making. Interestingly, regret may shape the decision making process. According to Abraham and Sheeran (2003), anticipated regret is the belief that the decision will be result of inaction. Anticipated regret may prompt behavior; that is, when a person indicates they will do something, such as exercise, they may follow through with their intended decision, to avoid regret. Once the decision is made, the impact of the decision, if regret is experienced, will impact future decisions. People can often get consumed with examining the other options that were available; the path not taken (Sagi & Friedland, 2007). In addition to regret, individuals may also experience satisfaction with their decisions. Satisfaction refers to how pleased the decision maker is with the outcome of the decision. There are many things that impact levels of satisfaction. Botti and Iyengar (2004) observed individuals prefer to make their own decisions and believe they will be more satisfied with their choices; however, when people are given only undesirable options, decision makers are less satisfied than those who have had the choice made for them. Botti and Iyengar posited the explanation for this phenomenon is that the decision maker assumes responsibility for the decision made. As a result, if the available choices are bad, they may feel as though they are responsible for making poor choices. Summary Decision making is an important area of research in cognitive psychology. Understanding the process by which individuals make decisions is important to understanding the decisions they make. There are several factors that influence decision making. Those factors are past experiences, cognitive biases, age and individual differences, belief in personal relevance, and an escalation of commitment. Heuristics are mental short cuts that take some of the cognitive load off decision makers. There are many kinds of heuristics, but three are important and commonly used: representative, availability, and anchoring-and-adjustment. After an individual makes a decision, there are several differing outcomes, including regret and satisfaction. Decisions that are reversible are more desired and people are willing to pay a premium for the ability to reverse decisions; though reversibility may not lead to positive or satisfactory outcomes. Cognitive psychologists have developed many decision making models, which explain the process by which people effectively make decisions. One innovative model is

IO G2A-DECISION MAKING based on goals and planning. There is yet a lot of research to be conducted on decision making, which will enable psychologists and educators to positively influence the lives of many.

BARRIERS FACED DURING EFFECTIVE DECISION MAKING

―Whenever you see a successful business, someone once made a courageous decision.‖ ― Peter F. Drucker

Effective decision making is an art which obviously cannot be earned overnight, hence, needs to be nurtured in time. However, even an effective leader cannot remain oblivious to certain hurdles which chronicle his decision-making capacity. An effective decision has positive effects on all the departments, and equal damage is caused by an ineffective decision. Hence, he has to remain vigilant about the repercussions caused by his decisions. Sometimes, taking a decision can equal to cracking a hard nut. As a professional as well as an individual, we face many situations in our professional as well as personal lives, wherein it is quite tough to take a decision. A careful study of various hurdles faced will lead you to take effective and better decisions in future.

IO G2A-DECISION MAKING PSYCHOLOGICAL BIASES    

Biases that interfere with objective rationality Illusion of control – a belief that one can influence events even when one has no control over what will happen. Framing Effects – how problems or decision alternatives are phrased or perceived. Subjective influences can override objective facts. Discount the Future – weigh short-term costs and benefits more heavily than longerterm costs and benefits. The avoidance of short-term cost or the seeking of short-term rewards may result in negative long-term consequences.

SOCIAL REALITIES 

Many decisions result from intensive social interactions, bargaining and politicking.

TIME PRESSURES 

In order to make timely and high-quality decision, one must:  Focus on real-time information‘s  Involve people more effectively and efficiently  Rely on trusted events  Take a realistic view of conflicts

Following are other barriers faced by an individual that affects in developing strategies on decision making: 

Level of Decision Making Not Clear

Sometimes, there is ambiguity in the level of power an individual holds, whether he/she holds the right to make modifications in the existing system. This often leads to confusion in the minds of the individual. 

Lack of Time

Hasty decisions often lead to disastrous effects. However, businesses are subject to emergencies and often, as a decision making authority, you need to take a call in the limited time available. This can pose a most difficult hurdle for most leaders, however, an effective leader has to go through these testing times. 

Lack of Reliable Data

Lack of reliable data can be a major hindrance in making apt decisions. Ambiguous and incomplete data often makes it difficult for them to make an appropriate decision, which may not be the best suited for any organization.

IO G2A-DECISION MAKING 

Risk-Taking Ability

Any decision attracts a fair deal of risk of resulting into negative outcome. However, it is necessary to take calculated risks for an effective decision. Also, at the same time, casual attitude and completely ignoring risks will not result in taking appropriate decisions. 

Too Many Options

An individual can be in a dilemma if there are too many options for an effective solution. Finding the appropriate one can be very difficult, especially if a particular decision favours a department over the other. 

Inadequate Support

An individual, however good he may be, cannot work without an adequate support level from his subordinates. Lack of adequate support either from top level or grass root level employees may result in a great jeopardy for the individual. 

Lack of Resources

An individual may find it difficult to implement his decisions due to lack of resources- time, staff, and equipment. In these cases, he should look out for alternative approaches which fit in the available resources. However, appropriate steps must be taken in case he feels that lack of resources may stop the growth of the organization. 

Inability to Change

Every organization has its own unique culture which describes its working policies. However, some policies are not conducive to managers who are looking out for a change. The rigid mentality of top-level management and the subordinates are the biggest hurdle, wherein an individual cannot make positive amendments even if he wishes to do so. Every experience is a big teacher, and individuals should take a cue from their previous experiences, and learn to boost their decision-making capacity. Big businesses have benefited greatly from positive changes and results, which implies that a manager should first and foremost improve his ability to deal with risks to take a good decision.

IO G2A-DECISION MAKING RATIONAL VS. EMOTIONAL DECISION MAKING Rational decision making is a multi-step process for making choices between alternatives. The process of rational decision making favors logic, objectivity, and analysis over subjectivity and insight. The word ― rational‖ in this context does not mean sane or clear-headed as it does in the colloquial sense. The Rational Decision-Making Process The rational decision-making process involves careful, methodical steps. The more carefully and strictly these steps are followed, the more rational the process is. We‘ll look at each step in closer de...