Question

Discussion #1 Describe how decision biases may impede effective decision making. What steps would you take to avoid them? Discussion #2 What is the difference between strategic management and operations management? What steps whould you take to ensure their alignment?

Answer 1

Discussion 1

1. Confirmation bias: this bias occurs when the decision is taken that confirms to pre-existing beliefs. This bias hinders effective decision making by discarding different conclusions that arise with the situation as the decision maker is contended with the decision that confirms his previous beliefs.

2. Anchoring bias: This bias occurs when the decision is taken prematurely after scanning initial information. The decision is based on the information that is generated initially thus preventing an effective decision making.

3. Halo effect: It refers to judging a situation based on a single characteristic. For example if the project completion time is shorter, it may be assumed as attractive without accounting costs and profits.

Discussion 2

Strategic management is concerned with long term planning for competitive advantage. Operations management is concerned with management of day to day activities.

Examples of strategic management involves management decisions related to mergers and acquisitions; examples of operations management include transportation, sequencing etc.

Strategic management decides the direction of a business; while operations management works to run the organization in that direction.

Alignment of strategic management and operations management is crucial for a successful business. To align strategic management with operational management, inputs from day to day operations must be used to develop a strategy. Similarly operations can be build around strategic management. This can be explained with an example: if the strategy is customer satisfaction, then the operations management must build its operations around satisfying customers like optimizing lead time.