Decision making in the organization 2600-MSMz2PDO

The lecture informs the students about the process of decision-making at the individual, group, organizational, and societal level.
The methods and conditions of decision-making are described. Both the explanatory and the normative research traditions are covered.
Specific issues include:
1. The subject and method of decision-making theory and research, language of the discipline, explanatory and descriptive approaches; levels of analysis.
2. Anatomy of the decision-making process: the idea of rational choice, values, preferences, goals, multigoal choice, multiattribute choice, logic of consequences vs logic of appropriateness. Decision-making models.
3. Factors affecting the decision-making process: decision-maker attention as a resource; optimal decision, satisfactory decision. Dealing with cognitive barriers. Irreversibility of the decision vs the cognitive dissonance. Decision-making under certainty.
4. Individual decision-making under risk: expected value, subjective expected value, expected utility, perspective theory, risk management. Heurstics and biases in decision making.
5. Individual decision-making under uncertainity: maximin, Hurwicz criterion, Savage’s criterion.
6. Decision-making in groups: advantages and disadvantages in group decision-making. Groupthink syndrom, shifting of the accepted risk threshold.
7. Decision-making in groups: methods of making decision involving multiple actors.
8. Multiple decions-makers in organizations: conflicts and politics. Social bases of divergent interests. Building interests’ alignment.
9. Methods for multiattribute decision-making: Simple Multi-Attribute Rating Technique (SMART).
10. Methods for decision-making under risk: Monte Carlo simulation.
11. Artificial intelligence and decision-making.