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© 2008 The McGraw-Hill Companies, Inc. All rights reserved

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Chapter

McGraw-Hill/Irwin

Teams and

Creative

Problem Solving

and Decision

Making

13

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Introduction (1 of 2)

Effective decisions are consistently related

to:

Higher individual performance

Organizational productivity

Firm financial performance

Behavior and human relations vary with:

Centralized decision-making authority

Decentralized (participative) decision-making

authority

Joint decisions or influence sharing

Empowerment

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Introduction (2 of 2)

Reasons for failed decisions:

following bandwagon behavior

ignoring ethics

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Decisions are made to solve

problems and take advantage

of opportunities, which can

occur at the same time.

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Problem Solving and Decision Making

Problem – exists whenever

there is a difference between

what is actually happening

and what the individual or

group wants to be happening

Problem solving – the

process of taking corrective

action in order to meet

objectives

Decision making – the

process of selecting an

alternative course of action

that will solve a problem

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Decision-Making Styles

Reflexive Style

Reflective Style

Consistent Style

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Decision-Making Model

Step 1. Define the problem

Step 2. Set objectives and criteria

Step 3. Generate alternatives

Step 4. Analyze alternatives and select one

Step 5. Plan, implement the decision, and control

Exhibit 13.1

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Cost-Benefit Analysis

Technique for comparing the cost and benefit

of each alternative course of action

Costs are both financial and non-financial

Approach is popular in the nonprofit sector

Benefits are often difficult to determine in

quantified dollars

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Creativity

Creativity – the ability to develop unique

alternatives to solve problems

Creative process has four stages:

1. Preparation

2. Possible solutions

3. Incubation

4. Evaluation

How people respond to creative ideas affects

the group’s behavior

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Responses That Kill Creativity

It isn’t in the budget.

It costs too much.

We’ve never done it before.

Has anyone else ever tried it?

It won’t work in our company.

That’s not our problem.

We tried that before.

It can’t be done.

That’s beyond our

responsibility.

Its too radical a change.

We did all right without it.

We’re doing the best we can.

We don’t have the time.

That will make other equipment

obsolete.

We’re too small / big for it.

Why change it? It’s still working

OK.

We’re not ready for that.

Let’s form a committee.

Let’s get back to reality. Exhibit 13.3

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Techniques for

Generating Creative Alternatives: (1 of 2)

Brainstorming Process of suggesting many alternatives, without

evaluation, to solve a problem

Synetics Process of generating novel alternatives through

role-playing and fantasizing

Nominal Grouping Process of generating and evaluating alternatives

through a structured voting method

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Techniques for

Generating Creative Alternatives: (2 of 2)

Consensus

Mapping

Process of developing a group consensus solution to

a problem

Delphi Technique Polls a group through a series of anonymous

questionnaires

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Why Decisions Fail

Rush-to-judgment

Managers accept the first alternative to solve the

problem

Misuse of resources

Managers spend their time and money during

decision-making on the wrong things

Applying failure-prone tactics of power and

persuasion to make decisions

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Group Problem Solving and

Decision Making

Advantages

Better decisions

More alternatives

Acceptance

Morale

Disadvantages

Time

Domination

Conformity and

groupthink

Responsibility and

social loafing

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The Normative Leadership

Decision Making Model

Has a time-driven and developmental-driven

decision-tree

It enables the user to select one of five leadership styles appropriate for the situation

to maximize decisions

Normative model because it:

provides a sequential set of questions that are rules (norms)

to follow

to determine the best leadership style for the given situation

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Normative Model:

Leadership Participation Styles (1 of 2)

Decide

The leader makes the decision alone and announces it to the

followers

Consult Individually

The leader tells followers individually the problem, gets

information and suggestions, and then makes the decision

Consult Group

The leader holds a group meeting and tells followers the

problem, gets information and suggestions, and then makes

the decision

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Normative Model:

Leadership Participation Styles (2 of 2)

Facilitate

The leader holds a group meeting and acts as a facilitator to

define the problem and the limits within which a decision

must be made

Delegate

The leader lets the group diagnose the problem and make

the decision within stated limits

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Normative Model: Determine Appropriate Leadership Style (1 of 3)

1. Decision Significance

How important is the decision to the success of the project or

organization?

2. Importance of Commitment

How important is follower commitment to implement the

decision?

3. Leader Expertise

How much knowledge and expertise does the leader have

with this specific decision?

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Normative Model: Determine Appropriate Leadership Style (2 of 3)

4. Likelihood of Commitment

If the leader were to make the decision alone, is it highly (H)

certain that the followers would be committed to the decision

or low (L)?

5. Group Support for Objectives

Do followers have high (H) or low (L) support for the team or

organizational goals to be attained in solving the problem?

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Normative Model: Determine Appropriate Leadership Style (3 of 3)

6. Group Expertise

How much knowledge and expertise do the individual

followers have with this specific decision?

7. Team Competence

Is the ability of the individuals to work together as a team to

solve the problem high (H) or low (L)?

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Normative Model:

The Time-Driven Model

Focus: Concerned with making effective decisions with

minimum cost.

Time is costly.

Value: Value is placed on time.

No value is placed on follower development.

Orientation: Short-term horizon

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Normative Model:

The Development-Driven Model

Focus: Concerned with making effective decisions with

maximum development of followers.

Follower development is worth the cost.

Value: Value is placed on follower development.

No value is placed on time.

Orientation: Long-term horizon.

Development takes time.

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Normative Model: Computerized Model

Vroom has developed a computerized CD-

ROM model

More complex, more precise, and easier to use

Combines the time- and development-driven

models into one model

Includes 11 variables/questions

Has five variable measures

Guides users through the process of analyzing

the situation

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Does Decision Making Apply Globally? (1 of 2)

Decision making styles and the decision

making model are based on the U.S.

approach to decision making

People from different cultures do not necessarily

make decisions the same way

Decision making styles do vary with culture

based on time orientation

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Does Decision Making Apply Globally? (2 of 2)

High Power Distance Cultures

Autocratic decisions are made

Participation is not acceptable

Normative leadership decision model would not be used

Low Power Distance Cultures

Greater use of participation in decision making