PRINCIPLES OF MANAGEMENT Topic 7 PDF

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Topic 7 Isabel, the owner of The Daily Dispatch , a small city newspaper, started her business two years ago, believing that there was still enough demand for her product. However, because people are busy and because so much news is now available online, she has seen the demand for her paper drop st...

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Topic 7 1. Isabel, the owner of The Daily Dispatch, a small city newspaper, started her business two years ago, believing that there was still enough demand for her product. However, because people are busy and because so much news is now available online, she has seen the demand for her paper drop steadily. Isabel made a decision to change the original direction of the company and focus more on an Internet news service. Isabel is relying on __________ by demonstrating that managers need to think and act as if their company is an unfinished prototype, and by seeing her business as outsiders do. Evidence-based decision making 2. Despite your best intentions, it’s hard to bring the best evidence to bear on your decisions. Why? There’s too much evidence, and there’s not enough good evidence and the side effects outweigh the cure 3. Party Supply uses time-series forecasts, such as past holiday sales and the strength of store sales this year, to predict future sales based on patterns of historical data. Party Supply is using Analytics 4. _________ is a data-mining technique used to predict future behavior and anticipate the consequences of change. Predictive modelling 5. Climax Medical Technology, a fast-growing global research firm, has accumulated so much client information that conventional database management systems cannot handle its customers’ needs. Therefore, Climax purchased very sophisticated analysis software and supercomputing-level hardware. Climax Medical Technology is tapping the power of Big data 6. Which of the following is NOT recognized as a key implementation principle of evidence-based management? Treat your organization as a closed system 7. A person’s ________ reflects the combination of how he or she perceives and responds to information. Decision-making style 8. ________ is the process of studying large amounts of data of a variety of types to uncover hidden patterns, unknown correlations, and other useful information. Big data analytics 9. Erin likes working in the banking industry because it has a lot of structure and certainty, and the daily work is routine. Erin probably Has a low tolenrance for ambiguity

10. Daniel loves sales because he responds well to the pressure he faces in the many new or uncertain situations he encounters as a salesperson. Like most successful salespeople, he is high in his tolerance for ambiguity, yet he struggles with making decisions quickly. Daniel likely has a(n) ________ decision-making style. Analytical 11. Nora is a small-business owner who loves to take risks. She also enjoys going out and meeting customers and potential clients—the social aspect of her job. Nora relies on intuition and discussions with others to acquire information. As an interior decorator, Nora utilizes her imaginative strengths, taking a broad perspective to problem solving, and she likes to consider many options and future possibilities. Nora’s decision-making style is best described as Conceptual 12. Uri, a server in a popular family restaurant, is the most popular employee with both customers and employees, and as a result, he usually earns the most in tips. He is always ready to lend a hand when asked, and with his warm personality and supportive nature, people confide in him. Uri does have a problem telling people no, and he has a tendency to avoid conflict because he is concerned about hurting others or getting people mad. Uri likely has a(n) _________ decision-making style. Behavioural 13. Bradley was recently promoted to the production manager of a busy shoe factory. He was chosen because prior to his promotion he had proven himself to be very efficient, and as a department manager he had a logical and practical approach to solving problems. Bradley has a reputation for being decisive and getting things done. Most of the factory’s employees like Bradley, but they feel he exercises too much control over them. Bradley has a(n) _________ style. Directive 14. Evan has a Bachelor’s degree in ethics and human resources, and he has extensive experience working with employees and managers regarding ethics, especially in the area of ethical dilemmas. In his current position he has assisted extensively in determining if the company’s decisions are both ethical and lawful. Which position in the company does Evan’s background make him ideally suited for? Ethics officer 15. A decision tree is A graph of decisions and their possible consequences 16. When confronted with a decision on an action, managers should utilize ________, which includes these four questions: “Is the proposed action legal? If yes, does the proposed action maximize shareholder value? If yes, is the proposed action ethical? If no, would it be ethical to take the proposed action?” Bagley’s ethical decision tree 17. Wendy, the CEO of an oil drilling company, and her top management team recently discovered that their facilities are damaging a beach in Asia and the local wildlife. They understand that they need to decide if temporarily closing or not closing the facility is unethical. To help them make their decision, they consider the following four

questions: “Is not temporarily closing the facility legal? If yes, does this proposed action maximize shareholder value? If yes, is not temporarily closing the facility ethical? If no, would it be ethical to take the proposed action?” Wendy and her top managers are using ____ to help them make their decision. Bagley’s ethical decision tree 18. When Sebastian wrote the contract with BP for over two billion dollars, he included targets for performance that had to be met before a payment would be released. Sebastian was trying to avoid ________bias. Escalation of commitment 19. Nikolai knows that what his boss has asked him to do is not in the best interest of the company. He also knows that if he does not do what he was asked to do, he will be written up and put on disciplinary action. He decides instead to do what his boss wants, just slower than his boss may have liked. Nikolai is using the principle of If all else fails, slow the spread of bad practice 20. When Ford was slow to recall vehicles to fix a possible carbon monoxide leak, it was most likely due to ________, because Ford was convinced that the modifications made by police departments were the cause of the problem, not the manufacturing of the vehicle. Overconfidence bias 21. Otis, the manager of a camera store, believes that his store may be closed by corporate in the near future, so he cannot sleep well at night and he is dealing with severe anxiety and irritability, and he has been ill several times this month. Several times Otis has missed important details in his job, and he almost got in an automobile accident this morning. The district manager is coming today to do his bimonthly evaluation of Otis’s store. Although Otis usually performs well, he is worried about this one. His district manager may be influenced by ________ bias. Availability 22. Bill is the new CEO at World’s Fair, a nationwide store that specializes in unique items from around the world. At his first managers meeting, he told them he likes to think of his management style as practical, efficient, logical, and systematic. Which style of decision maker is Bill? Directive style 23. Micah was talking with Aaron, his assistant manager, saying, “When I make a decision on which employees will do a project, I use three simple factors. I consider their attitude, knowledge, and how hard they work.” Micah uses ________ when making a decision. Heuristics 24. Readily available information may not present a complete picture of a situation due to Availability bias 25. When Damien, the sales manager, is deciding on who will train the new sales trainee, he tries not to look at just the recent sales numbers but also checks past sales

reports to determine who is the most productive salesperson. By using this method he is not affected by the _________ bias. Availability 26. Wes, the store manager, recently had to fire Andrea, an employee who graduated from Southern College. He felt that Andrea was not well trained at her school. So, when Zeke, also a graduate from Southern College, applied for Andrea’s old position, he did not want to consider hiring him, feeling Zeke also probably did not receive the proper training. Wes was affected by _____ bias. Representativeness 27. When people seek information to support their point of view and discount data that do not, they are subject to ______ bias. For example, Rick uses the fact that his commute is now shorter to confirm his belief that there are fewer cars on the road. However, Rick is not accounting for the fact that he recently took over the graveyard shift, and that traffic is always lighter at night and in the wee hours of the morning. Confirmation 28. Pablo and his managers spent a large sum of money on the new training program, and they feel that there has been little improvement as a result of the investment. The training is scheduled to continue for two more months, and Pablo feels that the company has already spent too much money on the training to simply abandon it. Pablo is experiencing Sunk-cost bias 29. Luke and Mia are selling their home. They listed their house three months ago at an extremely high selling price, a price they randomly chose. They do not want to reduce the price to reflect what the marketplace shows their home is really worth. Luke and Mia are participants in _____ bias. Anchoring and adjustment 30. ____ occurs when people’s subjective confidence in their decision-making is greater than their objective accuracy. For example, Penelope thinks she is a superb writer and editor, but her reports are always filled with typos, grammatical errors, and sentence fragments. Overconfidence bias 31. Republican advertisements about Representative Adam Johnson, the Democratic candidate, portray him as lazy, dishonest, and poor at his job. At the same time, the Democratic ads for Adam Johnson describe him as a caring, honest, hard worker. The sponsors of these advertisements know that ads can affect whom voters choose on Election Day. The tendency of decision makers (the voters in this example) to be influenced by how a situation or problem is presented to them is an example of Framing bias 32. Dale, the owner of a local real estate agency, is even more committed to making the used copier, which he recently purchased, work even though it keeps jamming, and his employees have been telling him about other problems they have been having with the copier. The ______ affects Dale’s decision making. Escalation of commitment bias

33. _____ causes people to view events as being more predictable than they really are. Hindsight bias 34. The advantages of _______ are having a greater pool of knowledge, gaining different perspectives, gaining intellectual stimulation, having a better understanding of decision rationale, and having a deeper commitment to the decision. Group decision making 35. Goal displacement, satisficing, and groupthink are The disadvantage of group decision making 36. Henry, Bekah, and Marcella are on the five-member Benefits Task Force that is researching options for the new benefits package. Over lunch, Henry suggests that going with the Members’ Choice HMO is the best course of action, and Bekah and Marcella agree with Henry for the sake of unanimity, without ever researching and accurately assessing the decision. Henry, Bekah, and Marcella are engaged in Groupthink 37. Satisficing is the tendency of A group to settle on a decision that is “good enough” 38. The Safety Committee at Washington Bakers was formed to help make the store a safer place, and some of the committee’s suggestions are going to be costly. During the committee meeting, the vice president of accounting announced that company profits were much lower than expected, and she suggested that profits are more important than safety. The profit goal is now outweighing the committee’s safety goal, which is an example of Goal displacement 39. In regard to decision making, which of the following statements reflects what research has found? Groups make better decisions than most individuals acting alone 40. With regard to decision making, it is accurate to say that groups Have higher decision-making accuracy when group members know a good deal about the relevant issues 41. Katia, the computer department manager at Tech Enterprises, is considering whether to use a group to develop a plan to help employees sell extended warranties on technology sales. Katia should consider having the group make this decision if It will increase acceptance of the plan 42. ____ is a technique used to help groups generate multiple ideas and alternatives for solving problems. Brainstorming 43. Which of the following is NOT an advantage of group decision making? satisficing

44. Ashante was telling a friend about her new job. She commented, “We work in groups all the time and everyone is able to share ideas. I am so new I just listen, but if I wanted to, I know they would listen to me too. Ashante is suffering from Illusion of unanimity and peer pressure 45. Which of the following reasons makes it hard to be evidence-based? The evidence doesn’t quite apply 46. What is a sign that a group is suffering from groupthink? Peer pressure makes members agree with the ideas of the other people in the group 47. Which of the following is NOT a guideline that can lead to effective brainstorming? Eliminate ideas that will be too costly 48. What is the role of the devil’s advocate in the decision-making process? To be the critic 49. Charles believes in having his team members present conflicting proposals before choosing one. He feels that this leads to the best decision and saves time in the long run because all options are explored up front. Charles uses the ______ decision method. Dialectic 50. Tyree is starting a new project and wants an advisory board, as this project will affect many people and hearing the opinions of others will be beneficial. As he sits down to consider who should be on the board, he lists many organizations, both civic and private. He wants to be sure to include the institutions of higher education, so that they can be informed of the type of employees he will need in the future. Tyree wants to be careful to not forget private citizens, so that this project will not end up causing a political debate and being shut down before it even starts. When he looks at his list, he has over 40 people on it. He decides that is a good enough number and he is ready to start sending out the invitations to the first meeting. Tyree’s partner advises him with which of these following statements? In general, the larger the group, the lower the quality of their decisions...