MHR 405 Chapter Notes - Chapter 7: Mental Model, Confirmation Bias, Satisficing
23 Apr 2014
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Decision making: the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs. Rational choice paradigm: the view in decision making that people should and typically do use logic and all available information to choose the alternative with the highest value. Subjective expected utility: the probability (expectation) of satisfaction (utility) resulting from choosing a specific alternative in a decision. Problem: deviation between the current and the desired situation. Opportunity: deviation between current expectations and a potentially better situation: choose the best decision process. Programmed decisions: follow standard operating procedures, optimal solution already been identified and documented based on previous events. Non-programmed decisions: requires all steps in the model because the problems are new or complex: discover/develop alternative solutions, choose the best alternative. Implement the selected alternative: evaluate decision outcomes. It"s logical, yet it is impossible to apply in reality.
