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    PPT SIMON

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    Simon model of decision making

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    PPT SIMON

    Uploaded by

    salonipatel0430
    10 views6 pages
    Simon model of decision making

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    Simon model of decision making

    Copyright:

    © All Rights Reserved
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    Download as pptx, pdf, or txt
    10 views6 pages

    PPT SIMON

    Uploaded by

    salonipatel0430
    Simon model of decision making

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
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    Principles of

    Management
    Unit II
    Pankaj Agarwal
    School of Management
    Graphic Era Hill University,
    Dehradun.

    1
    SIMON’S RATIONAL DECISION MAKING MODEL

    • Herbert A. Simon is an American economist and


    popular scientist who was known for his multiple
    contributions in the fields of psychology, statistics and
    mathematics.
    • He suggested that decisions were critical because if
    they weren’t taken on time, it’ll negatively impact an
    organization’s objective.
    • Implementing a decision is as important as making
    that decision.
    • Humans behave differently when there are risks and
    uncertainty involved i.e. based on bounded rationality.
    • One should make decisions that involve minimum risks
    and complications as opposed to focusing on
    maximizing profits.
    2
    3 Stages involved in decision
    Making
    1. Intelligence Activity Stage: At this stage, people identify the
    problems in an organization and the upper management analyzes
    the organizational environment to work toward a solution.

    2. Design Activity stage: In order to identify possible solutions to


    problems, the upper management looks for suitable strategies. They
    further analyze the merits and demerits to select a particular course
    of action.

    3. Choice Activity stage: After making a list of alternatives, the


    choice activity stage begins. It critically examines and evaluates the
    various consequences of all alternatives and the most suitable
    course of action is selected. This stage requires creativity, judgment
    and quantitative analysis skills.

    3
    Bias in decision-making
    • Self-serving bias
    • Authority bias
    • Confirmation bias
    • Framing bias
    • Overconfidence bias
    • Anchoring bias
    • Conformity bias
    • Feature positive effect
    4
    Contd..
    1. Self serving Bias: When you engage in a self-serving
    bias, you may unintentionally make decisions that benefit
    yourself over other employees, customers, clients, vendors
    or the organization and its goals.
    2. Authority Bias: Authority bias happens if you favor your
    authority input over others, despite there being
    information and opinions that are more sound and relevant
    to the problem you're attempting to solve.
    3. Confirmation Bias: It happens when you have existing
    beliefs and place more emphasis and value on information
    that supports those beliefs.
    4. Framing Bias: It happens when you make a decision
    based on how the presenter has shared the information
    because you, for example, may unintentionally assume
    that a well-designed presentation is more trustworthy than
    a simple email.

    5
    Contd.
    5. Overconfidence Bias: The overconfidence bias may occur
    if you're too confident in your intelligence, assumptions or
    ideas, frequently without the knowledge or experience to
    prove why your confidence is so high.
    6. Anchoring Bias: Anchoring biases are based on a person's
    natural tendency to gravitate toward the first piece of
    information they receive and allowing themselves to become
    influenced by it.
    7. Conformity Bias: when you make a decision based on
    what the majority decides.
    8. Feature positive effect: When you focus only on the
    positive benefits of your decisions.

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