Linear thinking style is characterized by a

persons preference for using external data and

facts and processing this information through
rational, logical thinking to guide decisions and
actions.
Non-Linear thinking style is characterized by a
preference for internal sources of information
(feelings and intuition) and processing this
information with internal insights, feelings, and
hunches to guide decisions and actions.

1.

2.

Overconfidence bias when decision makers

tend to think they know more than they do
or hold unrealistically positive views of
themselves and their performance.
Immediate gratification bias describes
decision makers who tend to want
immediate reward and to avoid immediate
costs.

3. Anchoring effect describes the situation

when decision maker fixate on initial
information as a starting point and then, once
set, fail to adequately adjust for subsequent
information.
4. Selective perception bias when decision
makers selectively organize and interpret
events based on their biased perception.
5. Confirmation bias decision makers who
seek out information that reaffirms their past
choices and discount information that
contradicts past judgements.

6. Framing bias decision makers select and

highlight certain aspects of a situation while
excluding others.
7. Availability bias causes decision makers to
tend to remember events that are the most
recent and vivid in their memory.
8. Representation bias when decision makers
assess the likelihood of an events based on how
closely it resembles other events or sets of
events.

9. Randomness bias when decision makers try

to create meaning out if random events.
10. Sunk costs error decision makers forget
that current choices cant correct the past.
11. Self-serving bias decision makers who are
quick to take credit for their successes and to
blame failure in outside factors.
12. Hindsight bias is the tendency for decision
makers to falsely believe, after that outcome is
actually known, that they could have accurately
predicted the outcome of an event.

Types of Problems and

Decisions
Well structured
programmed
Unstructured
nonprogrammed

Decision-Making
Conditions
Certainty
Risk
Uncertainty

Decision-Making
Approach
Rationality
Bounded rationality
Intuition

DecisionMaking
Errors and
biases

DecisionMaking
Process

Decision Makers Style

Linear thinking style
Nonlinear thinking
style

Decision
Choosing best
alternative
Maximizing
Satisficing
Implementing
Evaluating

Understand cultural differences.

Know when its time to call it quits.
Use an effective decision-making process.
Six characteristics of effective decision making
process:
- It focuses on whats important;
- Its logical and consistent;
- It acknowledges both subjective and objective
thinking and blends analytical with intuitive
thinking;
- It requires only as much information and analysis
as is necessary to resolve a particular dilemma;

It encourages and guides the gathering of

relevant information and informed opinion;
Its straight forward, reliable, easy to use, and
flexible.
Build an organization that can spot the
unexpected and quickly adapt to the changed
environment.
This suggestion come from Karl Weick
He is an organizational psychologist, who has
made a career of studying organizations and
how people work.

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He call such organizations Highly reliable

organizations (HROs) and says they share five
habits:
Theyre not tricked by their success.
They defer to the experts on the frontline.
They let unexpected circumstances provide
the solution.
They embrace complexity.
They anticipate but also recognize their
limits.