organizational psychology

decision making - m1-c1

Decision-making is a crucial part of life and work. It is the process of choosing the best option
from several alternatives to achieve a goal. Effective decision-making is especially important
in organizations to avoid wasting time, effort, or resources.

Definition of Decision Making

Decision-making is defined as the process of selecting the best option among alternatives to
achieve a specific goal.

Phases in Decision-Making

Herbert A. Simon explained decision-making as having three main phases: intelligence,

design, and choice. These phases help ensure good decisions are made.

1. Intelligence Phase

Definition: This is about identifying the problem and collecting information to

understand it.
Example: A manager notices employees are unhappy and missing deadlines. They gather
information by talking to employees and reviewing work reports to figure out why this is
happening.

2. Design Phase

Definition: This phase involves coming up with possible solutions and evaluating them.
Example: The manager considers options like giving employees flexible work hours, hiring
more staff, or organizing team-building activities. Each option is reviewed for how it might
improve the situation.

3. Choice Phase

Definition: This is when the best solution is chosen and put into action.
Example: The manager decides to implement flexible work hours because it seems most
practical and likely to make employees happier. They set up the new schedule and
monitor the results.

Mintzberg’s Phases of Decision-Making in Organizations

Henry Mintzberg introduced another model that focuses on how decisions are actually made
in organizations. It has three phases: identification, development, and selection.

1. Identification Phase
 Definition: This is when the problem is recognized and understood.
Example: A company realizes that sales are dropping. They investigate and find that
customers are unhappy with long delivery times.

2. Development Phase

Definition: During this phase, solutions are explored and developed.

Example: The company looks at options such as improving delivery processes, hiring
more delivery staff, or partnering with a faster courier serv ice.

3. Selection Phase

Definition:This is when the best solution is chosen.

Judgment: A leader makes a quick decision based on experience.
Analysis: The team carefully compares options and chooses the most logical one.
Bargaining: Different groups in the company discuss and agree on the best option.
Example: The company decides to hire more delivery staff because it’s affordable and
will improve delivery times the fastest. They announce the decision and start hiring.

Conclusion

Decision-making involves identifying problems, exploring solutions, and choosing the best
one. Whether using Simon’s or Mintzberg’s model, these steps help organizations make better
choices and address challenges effectively.

Decision-Making in Organizational Psychology

In organizational psychology, decisions are influenced by how complex the problem is and
how certain the outcomes are. Based on these two factors, decisions can be grouped into
four types: mechanistic, analytical, judgmental, and adaptive. Here's a clear explanation of
each, with examples to make them easy to understand.

Mechanistic Decisions

These are decisions that are predictable, repetitive, and often straightforward. They are like
following a checklist: there is little room for uncertainty because the alternatives and their
outcomes are well known. For instance, think about scheduling shifts for employees or
designing a routine onboarding process for new hires. These tasks don’t require deep analysis
or creativity; they follow a set pattern and are handled smoothly by applying existing
procedures.

Example: A company needs to schedule employee training. The HR manager uses the
training calendar and assigns employees to time slots based on availability.

Analytical Decisions
These decisions are based on detailed analysis and the processing of a lot of information.
When there are many options to choose from, managers rely on tools like data analysis or
models to predict the outcomes of their choices. This type of decision-making is about
finding the best solution using logic and evidence.

Example: An HR team conducts an employee engagement survey. Based on the data

collected, they analyze which factors—like workload or recognition—are causing
dissatisfaction and create an action plan to improve morale.

Judgmental Decisions

Judgmental decisions are made when there are only a few alternatives, but the outcomes of
these alternatives are not clear. In such cases, a manager relies on their experience, intuition,
and good judgment. These decisions are often about personal or leadership matters where
emotions and uncertainties play a big role.

Example: A manager must decide which employee to promote to a leadership role. While
there are only a few candidates, it’s hard to predict how they will perform in the new
position. The manager uses their experience and insight to make the best choice.

Adaptive Decisions

These decisions occur in highly complex and uncertain situations. There are many possible
options, and the outcomes of each are unknown. Adaptive decision-making requires flexibility
and teamwork, as the situation might keep changing. This is often used during crises or when
organizations face new challenges.

Example: After a sudden wave of resignations, a company’s leadership team must figure
out how to redistribute work and retain remaining employees. They come up with
temporary fixes but must continuously adjust their approach as the situation evolves.

Comparison in a Visual Box

 Type Description Example in Organizational Psychology

Mechanistic Simple, routine decisions with Scheduling employee shifts or organizing

predictable outcomes. routine training sessions.

Analytical Data-driven decisions that require Analyzing employee survey data to

processing a lot of information. identify and address dissatisfaction

factors.

Judgmental Decisions with limited options but Choosing an employee for promotion to a

uncertain outcomes, relying on leadership position without clear

judgment. performance data.

Adaptive Complex, uncertain decisions needing Managing a crisis like mass resignations

flexibility and collaboration. or adapting to sudden changes in the

organization.

This explanation organizes decision types into relatable scenarios, showing how they are
applied in real workplace situations. Let me know if you’d like a deeper dive into any category!

Nature of Decision-Making
Decision-making involves choosing the best option from several alternatives to solve a
problem or achieve a goal. The process depends on how much information the decision-
maker has about the situation and the possible outcomes.

Types of Decision-Making with Simple Examples

1. Decision-Making Under Certainty

Definition: This happens when you know exactly what will happen for every choice
you make.
Example:
A manager knows that giving employees a specific type of bonus increases their
performance by 10%, as proven in past experiences. The manager confidently chooses
this bonus option because the outcome is guaranteed.
2. Decision-Making Under Risk
Definition: This occurs when there are multiple possible outcomes for a choice, but
the manager knows the chances (probabilities) of each outcome.
Example:
A company starts a team-building program. Based on surveys, they know there’s a
70% chance it will improve teamwork, but a 30% chance it may not work as planned.
They proceed with the program, aware of the risks.
3. Decision-Making Under Uncertainty
 Definition: This happens when the manager has no idea about the outcomes or their
probabilities because there’s no data or past experience to rely on.
Example:
A company shifts to a fully remote work model due to unexpected circumstances, like
a pandemic. They don’t know whether it will increase or decrease productivity
because it’s a completely new situation.

Certainty: You know exactly what will happen. Example: Proven bonus plans.
Risk: You know the possible outcomes and their chances. Example: Team-building
programs with some risks.
Uncertainty: You have no idea what will happen. Example: Trying new policies during
unexpected situations.

models of DM process
Models of Decision-Making

Decision-making models help explain how individuals or groups approach decisions in various
contexts, including organizational psychology. Below are the explanations and organizational
examples for Econologic Model and Bounded Rationality Model, incorporating all key points.

1. Econologic Model (Rational Decision-Making Model)

Found by: Based on classical economic theory, this model was explained in
detail by Harrison in 1999.

Key Assumptions:

Decision-makers are economically rational and aim to maximize outcomes.

They are aware of all possible alternatives and their potential outcomes.
Decisions follow a structured and logical process, aligned with classical economic
theory.

Steps:

1. Identify the Problem: Clearly define the issue that needs a decision.
2. Determine the Criteria: Establish standards to evaluate potential solutions.
3. Generate Alternatives: Create a comprehensive list of all possible solutions.
4. Evaluate Consequences: Assess the outcomes and risks associated with each alternative.
5. Select and Implement the Best Option: Choose the alternative that meets the criteria
and promises the best outcome.

Critique :
 This model assumes complete rationality, which is unrealistic due to time, cognitive, and
information-processing limitations.
Despite these flaws, advancements in technology, like data analytics, make achieving
economic rationality more feasible.

Example in Organizational Psychology:

A company wants to improve employee satisfaction.

Step 1: Identify the problem—high turnover due to low satisfaction.

Step 2: Determine criteria—survey results, work-life balance, and compensation.
Step 3: Generate alternatives—offer flexible work schedules, increase pay, or provide
training programs.
Step 4: Evaluate consequences—analyze costs and predicted outcomes for each option.
Step 5: Choose and implement—decide to implement flexible work schedules based on
positive feedback and lower costs.

2. Bounded Rationality Model (Administrative Man)

Found by: This model was proposed by Herbert Simon in 1997.

Simon received the Nobel Prize in Economics in 1978 for his work on decision-making
processes.

Key Assumptions:

Decision-makers operate under constraints, such as limited time, cognitive capacity, and
information.
Instead of seeking the “best” solution, they aim for a “good enough” or satisfactory
outcome.
Uses heuristics (shortcuts or rules of thumb) to simplify decision-making.

Three Mechanisms:

1. Step-by-Step Selection: Alternatives are examined one by one. If one fails, it is discarded,
and another is considered until a satisfactory solution is found.
2. Heuristics: Shortcuts are used to focus on solutions with a high probability of success.
For example, relying on past experiences or well-performing patterns.
3. Satisficing: Once a solution meets minimum criteria, the search stops, even if it’s not
optimal.

Steps:

1. Define the problem to be solved.

2. Use heuristics to narrow down options quickly.
3. Identify a feasible alternative and assess its acceptability.
4. If the solution is satisfactory, implement it.
5. After implementation, evaluate its success and adjust future decision-making
expectations.
Example in Organizational Psychology:
A team leader is tasked with improving workplace productivity.

Step 1: Define the problem—low productivity in team members.

Step 2: Use heuristics—focus on strategies like regular feedback sessions that worked in
the past.
Step 3: Identify feasible alternatives—weekly meetings to review progress.
Step 4: Implement the solution—start weekly meetings and monitor results.
Step 5: Evaluate outcomes—productivity improves slightly, so the leader uses this
method for similar challenges in the future.

Critique:
This model is realistic as it reflects how decisions are often made in real-life organizational
settings. However, it risks missing better alternatives due to its satisficing approach.

Econologic Model Bounded Rationality Model

Assumes perfect decision-making is Accepts human limitations and focuses on

possible. simplicity.

Seeks the “best” solution. Settles for a “good enough” solution.

Follows a step-by-step and logical Uses shortcuts (heuristics) to make quick

process. decisions.

Unrealistic in most real-world situations. Reflects how decisions are actually made.

Implicit Favourite Model (Gamesman Model)

Proposed by: Soelberg in 1967

This model focuses on non-programmed decisions, which are new or unstructured (e.g.,
choosing your first job or hiring someone). Soelberg found that people often pick a favorite
option early and then justify it as if they made a logical choice.

Key Ideas

Decisions are intuitive, not purely rational.

The decision-maker picks an "implicit favorite" early in the process.
They evaluate other options (called "confirmation candidates") but often distort
information to favor their implicit choice.
 The process seems scientific but is largely emotional.

Steps in the Implicit Favourite Model

1. Pick the Implicit Favourite: Without realizing it, you choose the option you like the most.
Example: During job selection, a student might feel drawn to a particular company
because of its brand reputation.
2. Search for Alternatives: You consider other choices to compare and evaluate.
Example: The student attends interviews with other companies but compares
everything to their favorite choice.
3. Develop Decision Rules: You set criteria to evaluate the alternatives.
Example: You decide to rate companies based on salary, career growth, and work-life
balance.
4. Distort Information: You unconsciously highlight the strengths of your favorite choice
and downplay the strengths of others.
Example: You exaggerate how your favorite company offers growth opportunities
while ignoring its long work hours.
5. Make the Decision: You finalize the choice and present it as logical and rational.
Example: You accept the offer from your favorite company, justifying it by saying it
"scored the highest on your criteria."

Example in Organizational Psychology

A manager prefers one candidate during recruitment (implicit favorite) and evaluates others
only to confirm their initial choice. Despite interviewing multiple candidates, they eventually
hire their favorite while presenting the decision as logical.

Garbage Can Model

Proposed by: Cohen, March, and Olsen in 1972

This model explains that some decisions are made in a chaotic, unpredictable way, especially
in organizations where problems, solutions, and people interact randomly.

Key Ideas

Organizations are like a “garbage can” where problems, solutions, people, and
opportunities mix together.
Decisions are made randomly, not logically.
A decision occurs when all the right elements (problem, solution, decision-makers, and
opportunity) accidentally align.
This model is common during crises or fast-paced situations.

Steps in the Garbage Can Model

1. Problems and Solutions Exist Separately: Problems and solutions float around without
direct connection.
 Example: A company has unresolved issues (e.g., declining sales) and unused ideas
(e.g., new marketing strategies).
2. Players and Opportunities: People (decision-makers) and opportunities appear
unpredictably.
Example: The marketing team meets a consultant who proposes an innovative
campaign.
3. Alignment of Factors: A decision is made when a problem, solution, people, and
opportunity align.
Example: During a sudden sales drop, the company adopts the consultant’s idea
because the problem and solution align at the right time.
4. Implement the Decision: The chosen solution is applied without much analysis or
deliberation.
Example: The marketing campaign is launched immediately, hoping it resolves the
sales issue.

Example in Organizational Psychology

During a data breach, an organization scrambles to address the problem. The IT team
suggests hiring an external cybersecurity firm, and the CEO approves the solution
immediately, not because it’s the best option but because it aligns with the crisis.

Comparison Table: Implicit Favourite vs. Garbage Can Model

 Feature Implicit Favourite Model Garbage Can Model

Proposed By Soelberg (1967) Cohen, March, and Olsen

(1972)

Decision Type Non-programmed Random and chaotic

decisions (new, decisions.
unstructured).

Process Intuitive early choice, Decisions occur when

justified later with logic. random factors align.

Key Concept Decision-makers pick a Problems, solutions, and

favorite early and confirm opportunities mix
it. randomly.

Rationality Appears rational but is Not rational; decisions are

primarily unpredictable.
emotional/intuitive.

Steps Clear sequence: Implicit No sequence; decisions are

choice → Search → Justify. made by chance.

Common Scenarios Job selection, hiring, or Crisis management, fast-

choosing between paced or complex
products. environments.

Example Manager hiring a favorite A company implementing a

candidate and justifying it. quick fix during a crisis.

Both models emphasize that decision-making isn’t always logical or structured, especially in
dynamic or personal situations. While the Implicit Favourite Model highlights emotional
preferences disguised as rational decisions, the Garbage Can Model shows how chaos and
randomness influence decisions in fast-paced environments.

TECHNIQUES USED IN DM
1. Brainstorming
Brainstorming is a group activity where people come together to think of as many ideas as
possible without judgment. It encourages creativity and builds on the belief that a free-
flowing, non-critical environment leads to innovative solutions.

How It Works:

A group is presented with a problem.

Members suggest ideas freely, no matter how unusual or impractical they seem.
All ideas are noted without criticism or evaluation.
Once the session ends, ideas are reviewed and refined.

Example:

A company wants to improve employee engagement. During a brainstorming session, team

members suggest ideas like:

Hosting weekly game nights.

Offering flexible work hours.
Starting recognition programs for high performers. The goal is to generate a large pool of
ideas to find the most effective ones.

Principles:

No judgment: Ideas are not criticized during the session.

Encourage creativity: Even "wild" ideas are welcome.
Quantity over quality: The more ideas, the better the chances of finding a good one.

2. Synectics

Synectics involves using creative thinking techniques to connect unrelated ideas and develop
unique solutions. It combines logical thinking with imagination, often using analogies or role-
play.

How It Works:

A group led by a facilitator uses techniques like role-playing, analogies, and metaphors to
explore problems from different angles.
Unlike brainstorming, ideas are evaluated during the session with the help of a technical
expert.

Example:

In a leadership training session, managers use the analogy of a beehive to improve teamwork.
They discuss how each bee’s specific role contributes to the hive’s success, then apply this to
creating more effective team structures.

Key Difference:

Brainstorming avoids evaluating ideas until later.

 Synectics evaluates ideas during the process to ensure practicality.

3. Nominal Group Technique (NGT)

This technique is structured and reduces group discussions to avoid domination by any single
individual. Members work individually first, then come together to share ideas.

How It Works:

1. Group members are introduced to a problem.

2. Each person writes down their ideas privately (no group discussion).
3. Ideas are shared with the group and written on a board.
4. After discussion, members vote or rank ideas to decide which ones are most important.

Example:

A company is deciding on a new employee wellness program.

Each HR member writes down suggestions like gym memberships, mental health days, or
free healthy snacks.
The team ranks these ideas based on cost, feasibility, and employee preference.

Why It’s Useful:

This technique minimizes the influence of dominant personalities, ensuring every member’s
idea is considered equally.

4. Delphi Technique

The Delphi method gathers feedback from experts without requiring them to meet in person.
It’s a great technique for getting insights when people are located in different places or are
too busy to meet.

How It Works:

1. A central coordinator sends a questionnaire to experts on a topic.

2. Experts respond with their ideas or feedback.
3. The coordinator summarizes the responses and shares them with the group for further
input.
4. This process repeats until the group reaches a consensus.

Example:

An organization wants to implement a new training program for managers. Experts from
different fields (psychology, business, and education) are consulted via email. Each expert
shares their ideas, which are refined over several rounds until a clear plan emerges.

Why It’s Useful:

The Delphi technique allows organizations to make decisions based on input from a wide
range of experts without logistical issues like travel or scheduling conflicts.

Evaluation of Alternatives and Factors Affecting Them

After identifying possible options, the next step is to assess them to find the best solution.
Each option is evaluated based on its strengths, weaknesses, benefits, costs, and how well it
fits the goal.

Factors That Affect Evaluation

1. Clear Goals:
Having clear goals makes it easier to compare options.
Without clear goals, decisions can get delayed or be based on personal preferences.
Example: If a company doesn’t clearly decide whether it wants more profits or higher
customer satisfaction, it’s hard to pick the best strategy.
2. Information Availability:
To evaluate properly, you need accurate and complete information about the options.
Problems include:
Bias: Misinterpreting or ignoring key information.
Lack of knowledge: Being unaware of all options.
Example: When buying a camera, your decision depends on how much you know
about available brands and features.
3. Implicit Favorite:
Sometimes, we unconsciously favor one option and overlook others.
Example: A manager might prefer a job candidate they personally like, even if another
candidate is better qualified.
4. Satisficing:
Instead of finding the best option, decision-makers often settle for one that is “good
enough.”
Example: Choosing the first vendor who meets basic needs without comparing all
options.

Effective Evaluation of Alternatives

To improve decision-making, use structured approaches:

1. Systematic Evaluation:
Compare options step by step using clear criteria.
Example: When hiring someone:
1. List the important qualities (e.g., experience, skills).
2. Rate each candidate on these qualities.
3. Rank candidates based on their total scores.
2. Scenario Planning:
Think about possible future situations and how each option might work in those
scenarios.
 Example: A company might prepare different strategies for economic growth or a
downturn.

Selection of Alternatives

Once options are evaluated, choose the one most likely to meet the goals.

Key Points:

1. Balancing Goals:
Decisions often require trade-offs between things like cost, quality, or speed.
Example: A company might choose slower delivery to save money.
2. Resource Limits:
Choices depend on what’s available, like budget, time, or staff.
Example: Choosing a simpler marketing strategy because of budget restrictions.
3. Judgment and Experience:
Experienced decision-makers can balance different factors and make practical
choices.
Example: A project manager may pick a slightly expensive contractor if they know the
contractor is reliable.

In practice, selecting an option often requires compromise, but a systematic approach helps
make better decisions.

1. Problems in the Decision-Making Process

Definition:

Problems in decision-making refer to the challenges, biases, or errors that hinder effective
decision-making. These issues may arise due to incomplete information, cognitive biases, or
poor problem analysis.

Key Problems:

1. Evaluating Before Investigating:

Explanation: Jumping to conclusions before thoroughly analyzing a problem can lead
to poor decisions.
Example: A manager sees a decline in employee productivity and immediately
assumes laziness, without investigating possible causes like workplace stress or
inadequate tools.
Teaching Tip: Discuss how rushing to conclusions can worsen problems rather than
solving them.
2. Equating New and Old Experiences:
Explanation: Treating every new problem as if it's identical to past problems prevents
innovative solutions.
Example: If a previous marketing campaign succeeded in urban areas, a team might
replicate it for rural areas, ignoring cultural differences.
 Teaching Tip: Ask students to brainstorm how unique solutions could be developed
for different contexts.
3. Using Readily Available Solutions:
Explanation: Opting for the most convenient solution may bypass better alternatives.
Example: A company facing high attrition decides to increase salaries but ignores
addressing toxic workplace culture.
Teaching Tip: Highlight the importance of creativity and innovation in problem-
solving.
4. Confusing Symptoms with Root Problems:
Explanation: Focusing on surface-level symptoms rather than addressing the root
cause can lead to ineffective decisions.
Example: Treating frequent customer complaints about slow service by hiring more
staff without identifying process inefficiencies.
Teaching Tip: Use a root-cause analysis exercise to show how digging deeper can
reveal the actual problem.

2. Misunderstanding a Situation

Definition:

Misunderstanding a situation occurs when decision-makers misinterpret circumstances due

to biases, lack of information, or differing perceptions.

Key Factors:

1. Perceptual Biases:
Explanation: People see situations through their own perspectives, which can distort
reality.
Example: Two employees, one introverted and one extroverted, may perceive a
workplace as hostile or friendly based on their personal outlooks.
Teaching Tip: Conduct a classroom activity where students describe the same image
or event, highlighting how perceptions differ.
2. Incomplete Information:
Explanation: Making decisions with partial data often leads to errors.
Example: A company launching a product without studying competitors’ pricing might
face poor sales.
Teaching Tip: Use case studies where incomplete information caused failures (e.g.,
failed business ventures).
3. Emotional Influence:
Explanation: Strong emotions like anxiety or excitement can cloud judgment.
Example: A manager might prematurely approve a project due to excitement about its
potential, ignoring its feasibility.
Teaching Tip: Discuss how emotional intelligence helps in maintaining objectivity.

Examples of Misunderstanding Situations:

 Example 1: A teacher believes a student is inattentive due to laziness, but the student has
a learning disability.
Example 2: A leader misinterprets a drop in team performance as a lack of motivation,
not recognizing that unclear instructions are the real issue.

3. Rushing the Decision-Making Process

Definition:

Rushing decisions involves making choices without giving adequate time to evaluate options
or gather information.

Key Issues:

1. Reacting Without Thinking:

Explanation: Acting impulsively without careful thought often leads to mistakes.
Example: A CEO immediately cuts marketing budgets after a sales dip, only to realize
later that poor product quality was the issue.
Teaching Tip: Use examples of businesses that faced losses due to impulsive
decisions.
2. Ignoring Evaluation:
Explanation: Decisions made without reviewing alternatives or seeking feedback can
miss better opportunities.
Example: A team selects the first vendor they meet for a project without comparing
others, leading to higher costs.
Teaching Tip: Emphasize the importance of critical evaluation by introducing a step-
by-step decision-making process.
3. Underestimating Consequences:
Explanation: Hasty decisions often fail to consider long-term impacts.
Example: Introducing a new policy without assessing its impact on employee morale
might lead to dissatisfaction.
Teaching Tip: Encourage students to analyze short-term vs. long-term consequences
of sample scenarios.

Why Rushing Happens:

1. Time Pressure: When deadlines loom, individuals feel compelled to make quick decisions.
2. Overconfidence: Believing they can handle situations quickly, leaders may bypass
thorough analysis.
3. Groupthink: Pressure to conform in group settings can lead to hasty, unanimous
decisions.

Examples of Rushed Decisions:

Example 1: A team approves a merger based solely on financial metrics, ignoring cultural
compatibility, leading to integration issues later.
 Example 2: A product is launched without sufficient testing, causing customer backlash
due to defects.

1. Improving the Decision-Making Process

Ways to Make Better Decisions:

Awareness of Cognitive Biases: Train people to notice and avoid thinking mistakes, like
assuming things are true without enough evidence.
Cognitive biases are ways our thinking can go wrong, like:
Anchoring: When we focus too much on the first thing we hear.
Overconfidence: When we think we know more than we really do.
Groupthink: When we just agree with the group instead of thinking for ourselves.
In the marketing manager example, they avoid being overconfident by looking for extra
information from other sources. This helps them make better decisions instead of just
trusting their first thoughts.
Example: A marketing manager checks outside opinions to make sure they’re not just
overestimating how well their campaign is doing.
Skill Development: Help people improve their problem-solving and thinking skills.
Example: Offer training on tools to analyze data for the finance team.
Using Structured Approaches: Follow proven models for decision-making:
Rational Model: Think logically and try to get the best outcome.
Bounded Rationality Model: Sometimes, due to limited time or resources, people
make good enough decisions instead of perfect ones.
Example: A startup uses a simple chart to compare costs and benefits of different
vendors.
Feedback Loops: Keep checking past decisions to see what worked and what didn’t to
improve future ones.
Example: A software company looks at past project successes to make improvements
for future releases.
Decision-Making Tools: Use tools like SWOT (strengths, weaknesses, opportunities,
threats) analysis, cost-benefit analysis, and decision trees to help make clear decisions.

2. Structured Group Decision-Making Process

What is it? It’s when groups of people use a planned method to make decisions together.

Different Ways Groups Make Decisions:

Consensus-Based Decision-Making: Everyone agrees before the decision is made.

Example: A design team agrees on new product features after discussing feedback.
Majority Voting: The decision is based on what most people choose.
Example: A school board votes on whether to adopt a new curriculum.
Minority Rule: A small group of experts makes the decision.
Example: A legal team decides on the best strategy for company compliance.
Authority Rule with Input: The leader makes the final decision after getting input from
the team.
Example: A CEO decides on company acquisitions after hearing from senior managers.
 Delphi Technique: Experts give their opinions anonymously, and those are combined to
make a decision.
Example: Gathering opinions from economists to predict industry trends.
Nominal Group Technique (NGT): Team members come up with ideas individually, then
discuss them together and vote on the best one.
Example: Solving project issues by brainstorming and voting on the best solution.

Steps in Group Decision-Making:

1. Problem Identification: Identify what the issue is.

Example: A company realizes that their product launches are always delayed.
2. Generating Alternatives: Think of different ways to solve the problem.
Example: Marketing team debates whether to use digital ads or traditional ones.
3. Evaluating Alternatives: Compare different options based on set criteria (cost, time,
impact).
Example: Doing a cost-benefit analysis to choose between suppliers.
4. Selecting Alternatives: Choose the best solution by voting or reaching a consensus.
Example: Picking a supplier after discussing with all departments.
5. Implementation: Put the solution into action, assigning tasks and deadlines.
Example: After agreeing on a new inventory system, the team starts using it.
6. Review and Feedback: After the decision is made, check if it worked and see how to
improve next time.
Example: Measuring sales after a marketing campaign to see if it was successful.

3. Challenges and Solutions

Common Problems:

Groupthink: Everyone just agrees with each other, even if it’s not the best decision.
Solution: Assign someone to challenge ideas and make sure all opinions are
considered.
Social Loafing: Some group members do less work because they feel others will pick up
the slack.
Solution: Assign clear responsibilities to each member.
Risky Shift: Groups sometimes make riskier decisions than individuals would.
Solution: Use clear guidelines to evaluate risks and avoid hasty decisions.

Case Studies and Examples:

Tata Steel’s Joint Decision-Making: Employees and managers work together to improve
safety and operations in the company.
Example: Employees give input on safety measures in the workplace.
Corporate Sustainability Decisions: Companies use tools to consider the impact of their
decisions on people and the environment.
Example: A company chooses between two renewable energy projects based on
feedback from the community.
Startup Agile Development: Startups often use short, structured meetings (called daily
stand-ups) to quickly identify and fix issues.
Example: A tech startup identifies and fixes a bug before launching their product.