CHAPTER 6 Decision Making SPORTS AND ENTERTAINMENT MANAGEMENT 4/25/2018 CHAPTER 6 Decision Making 6.1 How Managers Make Decisions 6.2 Group Decision Making 6.3 Knowledge Management CHAPTER 6 CHAPTER 6

LESSON 6.1 HOW MANAGERS MAKE DECISIONS GOALS Discuss the types of decisions made by managers. Describe the conditions faced by a manager when making a decision. CHAPTER 6

IS IT DECISION MAKING OR PROBLEM SOLVING? Decision making is the process of creating and choosing alternatives to reach a goal or objective. Problem solving is the process of choosing actions to combat or resolve a problem. All problem solving involves decision making. However, not all decision making involves problem solving. CHAPTER 6

IS IT DECISION MAKING OR PROBLEM SOLVING? Managers must learn how to effectively separate decision making from problem solving. Decision making is a learned skill that managers practice. Problem solving can be delegated to employees. If employees solve problems, decision making is easier for the manager. CHAPTER 6

DECISIONS—PROGRAMMED OR NONPROGRAMMED Programmed decisions Carefully thought out 9 out of 10 decisions made are programmed decisions (automatic response) CHAPTER 6

DECISIONS—PROGRAMMED OR NONPROGRAMMED Nonprogrammed decisions Often called creative decision making or judgment decision making More difficult and risky CHAPTER 6

DECISIONS—PROGRAMMED OR NONPROGRAMMED Intuitive approach Based on guesses, hunches or intuition. (Ex: females can’t play sports) Poorest method. Optimizing approach Time-tested methods, weigh decision criteria (Ex: salaries based on productivity) Scientific approached, considered the best Satisficing approach Managers set a minimum standard of acceptance. (Ex: You pick a movie based on not waiting long) CHAPTER 6

DECISION-MAKING STYLES Autocratic decision making Manager makes decisions alone without consulting anyone. Consultative decision making Shares problems and opportunities with employees. Group-oriented decision making Group is called upon to make decisions for the organization. (Employees, consultants, managers) CHAPTER 6

CONDITIONS IMPACT DECISION MAKING Degrees of certainty If the manager does not know exactly what will happen, then the decision is being made in a state of uncertainty. This happens when they do not have good information. Risk Most managers seek to reduce or eliminate risk. Individual differences Information overload occurs when managers receive so much information that they become confused, or reluctant to make a decision. CHAPTER 6

CONDITIONS IMPACT DECISION MAKING Shortcuts Rules of thumb What mangers think Managers “frame” decisions. Each manager defines a decision in a particular way. Personal feelings impact decisions. Barriers Does the organization stimulate decision making? Do they reward quick decisions? Are managers afraid to make decisions due to consequences? CHAPTER 6

LESSON 6.2 GROUP DECISION MAKING GOALS Explain the advantages and disadvantages of group decision making. Identify techniques for improving group decision making. CHAPTER 6

TWO HEADS ARE BETTER THAN ONE Group – two or more persons who interact for a specific purpose. A group is generally cohesive—something attracts its members. Being in a group is not easy. You must be willing to sacrifice beyond your personal needs. Managing sports teams and events is a complex process and decisions are rarely made by just one individual. CHAPTER 6

TWO HEADS ARE BETTER THAN ONE Group performance is generally superior to individual performances. Groups tend to generate more ways to solve problems. Every manager needs to know when group decision making is called for and when it is not. CHAPTER 6

ADVANTAGES OF GROUP DECISION MAKING Different perspectives More knowledge Group ownership of and responsibility for the decision Better understanding of decision (Ex: McDonald’s and X-games) CHAPTER 6

DISADVANTAGES OF GROUP DECISION MAKING Bossy individual(s) tries to dominate Pressure to conform even if you disagree Self promotion of his/her own ideas Groupthink Happens when members try so hard to agree with one another that they ignore an individual member’s point of view. Group decisions take longer to make. CHAPTER 6

GOOD GROUP DECISION MAKING RESULTS IN GOOD TEAMS A team defines the roles of members with respect to expectations and positions. CHAPTER 6

TECHNIQUES FOR IMPROVING GROUP DECISION MAKING Brainstorming – exposes a group of people to a problem and then allows them to generate ideas for solution. All ideas are considered. Nominal group technique – group members work separately in the early phases to solve the problem. They share discoveries at the end . Group member then vote on the best solution. CHAPTER 6

TECHNIQUES FOR IMPROVING GROUP DECISION MAKING Delphi technique – Similar to nominal but does not include voting. Members answer a questionnaire and then reach a consensus. Brainwriting – Review a problem and write a solution. Trade papers within the group and build on the ideas. Synectics method – “makes the familiar strange and the strange familiar”. Most creative method. CHAPTER 6

LESSON 6.3 KNOWLEDGE MANAGEMENT GOALS Describe the concept of knowledge management. Explain how knowledge communities can benefit sports and entertainment managers. CHAPTER 6

WHAT IS KNOWLEDGE MANAGEMENT? Knowledge management is the ability of a manager to understand what is known in his or her organization and to use that knowledge effectively. CHAPTER 6

WHAT KNOWLEDGE DOES AN ORGANIZATION HAVE? Tangible knowledge Resources can be licenses, contracts, brands, team name or event name. Intangible knowledge Resources might be employee experiences, traditions, or brainstorming results. The reason to collect knowledge is to make decisions or take action. CHAPTER 6

KNOWLEDGE CAN BE GENERATED Bought Ex: Faith Hill hires a songwriter. Rented Ex: consultant hired for short-term project Designated Ex: R&D (Research and Development dept) CHAPTER 6

KNOWLEDGE CAN BE GENERATED Meld one part of the business with another (Ex: Pixar puts computer animators with story development) Growing and changing Form knowledge communities with Internet and computer technologies. CHAPTER 6

KNOWLEDGE COMMUNITIES Knowledge communities create, capture, share, and maximize the use of knowledge about a particular subject. Can be informal like hallway or water-cooler conversation. Can be formal groups or networks on the Internet. CHAPTER 6

KEY TO SUCCESSFUL KNOWLEDGE TRANSMISSION The organization includes an internal and external information system. The system provides appropriate tools for acquiring knowledge. The organization’s senior managers believe in knowledge acquisition and knowledge management. The organization has an enlightened view toward gathering and sharing knowledge. It supports the idea that “two heads are better than one.” CHAPTER 6

KEY TO SUCCESSFUL KNOWLEDGE TRANSMISSION Continued KEY TO SUCCESSFUL KNOWLEDGE TRANSMISSION The organization believes in change and pursues it by creating links between knowledge and the overall organizational mission. The organization encourages opportunities for learning and gaining knowledge. Employees constantly are challenged to learn new things. CHAPTER 6