Decision making, Ethical behavior in international business.

Here we see two types of decisions; a program type is simply a decision that is already established for the manager to make, while a nonprogrammed kind is an entirely new decision which requires creativity, there are some models of decision making, the rational model which defines how persons should behave to optimize the outcome, the bounded rationality models that states some limits about how rational someone making the decisions can actually be, and there is also a garbage can model that suggests that the decisions within an organization are random.

Risk aversion: individuals who chose options with low risk, there are also risk takers who accept greater potential for loss. Escalation of commitment is “the tendency to commit resources to a failing course of action, this occurs due to optimism, personal pride and others.

Participative decision making is basically making choices in which persons that are affected by decision, influence the making of those choices, when it comes to making decisions is not fair to say that is better to do it individually than in a group, or vice versa, because for the most part this depends on what kind of task or problem you are up against.

Techniques for group decision making: ‘’Brainstorming’’: generate as many ideas as possible on a subject, ‘’Nominal Group Technique’’: generating alternatives and choosing one. ‘’Delphi technique ‘’ experts knowledge in decision making, ‘’devil’s advocacy’’ preventing group think. ‘’dialectical inquiry debate of opposing sets.

Ethics are norms and rules people belief to be the right things to do on the other hand morals could be seen as principals to determine what is right or wrong, ethical behavior is defined as ‘’acting in ways consistent with one’s personal values and the commonly held values of the organization and society, there are some ethical theories. One is the consequential theory that emphasizes the outcomes of behavior; another one is the ruled based theory which is more about the act and not the effects, and there is also the character theory about personal virtues of the person.

How can organizations effectively manage both risk taking and escalation of commitment in the decision-making behavior of employees?

Risk decision making and escalations commitment can be managed by training employees to identify the negative effects that can occur when they make a decision, also encourage them to notify the decisions they want to make so the managers can make a considerations of the risk, some risky moves can pay off in the future but this has to be well monitored to avoid a potential harm to the organization. Another way to manage this is by forming work groups to evaluate the decision making beforehand.

image retrieved  from: http://www.google.com/imageshl=es&xhr=t&q=decision+making&cp=13&um=1&ie=UTF8&source=og&sa=N&tab=wi&biw=1280&bih=595

image retrieved from: http://www.google.com/images?um=1&hl=es&biw=1280&bih=595&tbs=isch:1&sa=1&q=ethics&aq=f&aqi=g2&aql=&oq=
information retrieved from: http://interactiva.eafit.edu.co/ei/
information retrieved from: http://www.ehow.com/about_5438007_risk-management-decision-making.html