1. Decision-Making Process
E. FRANK HARRISON
Fifth Edition
The Managerial
Decision-Making Process

2. The Managerial Decision-Making Process Fifth Edition
Author: E. Frank Harrison, Ph.D.
Slides by Monique A. Pelletier, Ph.D.

3. Values for Decision Making
Chapter 4
Values for Decision Making

4. The Basics Properties of Values
Values are acquired early in life.
Values are like attitudes, but are more ingrained and permanent.
Values differ among individuals.
Values govern our perceptions and our behavior.
Values facilitate the process of self-evaluation.

5. The Basics Properties of Values (cont’d)
Values comprise a guidance system for decision making.
Values permeate the entire process of choice.

6. Rokeach’s Typology of Human Values
Terminal Values
l Personal values
l Social values
Instrumental Values
l Competence values
l Moral values
Managerial Values
l Competence values
l Personal values

7. Figure 4.1 A Typology of Human Values
Terminal values
Instrumental
values
Personal
values
Social
values
Competence
values I II
Moral
values
III IV

8. England’s Study of Managerial Values, No. 1
Operating values
l values of greater importance
Non operating values
l values of lesser importance

9. England’s Study of Managerial Values, No. 2
Goals of business organizations
Personal goals of individuals
Groups of people
Ideas associated with people
Ideas about general topics

10. Table 4.1 Ranking of Managerial Values by Category
Ideas Ideas about
Goals of Business Personal Goals Associated General
Organizations of Individuals Groups of People with People Topics
Organizational efficiency* Achievement* My company* Ability* Change*
High productivity* Success* Customers* Ambition* Competition*
Profit maximization* Creativity* Managers* Skill* Authority
Organizational growth* Job satisfaction* My boss* Cooperation* Caution
Industrial leadership* Individuality My subordinates* Aggressiveness Compromise
Organizational stability* Money Technical employees* Loyalty Conflict
Employee welfare Influence Employees* Trust Conservatism
Social welfare Prestige Me* Honor Emotions
Autonomy My coworkers* Tolerance Equality
Dignity Craftsmen* Prejudice Force
Security Owners* Obedience Liberalism
Power Stockholders* Compassion Property
Leisure White-collar employees* Conformity Rationality
Blue-collar workers Religion
Government Risk
Laborers
Labor unions
*Operating values of high importance

11. A Conceptualization of Managerial Values
Individual values
Organizational values
Organizational/Individual values = Managerial values
Managerial values are a composite of diminishing individual values and overlapping organizational values

12. Figure 4.2 Profile of Managerial Values
Organizational
Values
Managerial
Values
Individual
Values

13. Ethical Behavior
Ethics constitute the normative standards for management decision making.
In reality, ethics change to fit the attitude of the decision maker and the specific variables in the decision at hand.

14. Ethical Behavior (cont’d)
Therefore, ethics comprise a transitional phenomenon in managerial decision making.
Although declaredly normative, ethics are highly subjective and ephemeral.
It is tenuous to judge a managerial decision on its ethical merits.

15. Value Conflicts
Value conflicts between the individual and the organization
Value conflicts between the organization and society
Value conflicts are inevitable at all levels.

16. Value Conflicts (cont’d)
Value conflicts may have favorable or unfavorable consequences.
Higher levels of management tend to have fewer value conflicts because they personify the values of the organization.

17. Value Judgments
The term judgment is not synonymous with the term decision.
Judgment involves evaluation and categorization.
Decision involves commitment and action.

18. Value Judgments (cont’d)
A value judgment is a special type of evaluation or categorization applied to a decision-making situation.
Value judgments provide a basis for making and implementing decisions, but they are not a surrogate for any part of the decision-making process.