Stevens Institute of Technology
Howe School of Technology Management
Syllabus
EMT 635 Managerial Judgment and Decision Making
Spring 2014
James W. Smither, Ph.D.
908.642.2678 or 215.951.1797
jwsmither@msn.com
Saturdays 1:15 PM to 5:15 PM
Office Hours:
Before or after class
Overview
The objective is to acquaint students with the research and principles of judgment and
decision making. Most of the material covered is about understanding and improving
the judgment and decision making processes of managers and other professionals.
Understanding decision making involves examining how decision makers think about
difficult problems and characterizing the limitations of human decision making ability.
By understanding how decisions are made, we can provide guidelines and techniques
for overcoming limitations and improving the quality of decision making. This includes
understanding statistically-based decision making, the psychological aspects of decision
making and rational approaches to decision making. The goal is to provide insights and
tools that will enable students to support and improve their own decision making as
well as to understand the decision making of others.
Learning Goals
After taking this course, the student will be able to:
1.
2.
3.
4.
Understand explain major approaches to judgment and decision making
Analyze decisions from a statistical and rational model perspective
Understand how bounded rationality and satisficing affect managerial decisions
Understand how interpersonal and cognitive processes affect decisions and
judgments.
5. Apply models to make decisions under uncertainty and crisis
6. Understand and apply principles of conflict and negotiation
Pedagogy
The course will employ lectures, class discussions, and in-class exercises. A series of
exercises are used to illustrate principles of judgment and decision making. Exercises
include the taxi problem (an illustration of Bayesian reasoning), a group decisionmaking exercise, the prisoner’s dilemma, a two-person negotiation exercise, and a
variety of case examples.
Students must complete two papers. The first requires analyzing the decision-making
failures (as well as other factors) that led to the airline disaster at Tenerife and the 1996
Mt. Everest disaster. The second requires analyzing the decision-making processes
during the Cuban missile crisis.
The final project requires developing an original case study of a decision, including the
context, background, decision, and aftermath. Students must use decision-making
concepts from the course to describe and analyze the case. Each student will make a
formal presentation of the case and will answer questions from the class and professor.
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Required Text
Text: Bazerman, M.H., & Moore, D.A. (2009). Judgment in Managerial Decision Making, 7th
ed., Wiley.
Readings
1. Belkin, L. (2002). The odds of that. The New York Times Magazine, August 11.
2. * Bikhchandani, S., Hirshleifer, D., & Welch, I. (1998). Learning from the behavior
of others: Conformity, fads, and informational cascades. The Journal of Economic
Perspectives, 12, 151-170.
3. Bruck, C. (2009). Angelo’s ashes. The New Yorker, June 29.
4. Dana, J., & Dawes, R.M. (2004). The superiority of simple alternatives to
regression for social science predictions. Journal of Educational and Behavioral
Statistics, 29, 317-331.
5. * Eden, D., & Shani, A. B. (1982). Pygmalion goes to boot camp: Expectancy,
leadership, and trainee performance. Journal of Applied Psychology, 67(2), 194-199.
6. * Folger, R., & Konovsky, M.A. (1989). Effects of procedural and distributive
justice on reactions to pay raise decisions. Academy of Management Journal, 32,
115-130.
7. * Frederick, S. (2005). Cognitive reflection and decision making. Journal of
Economic Perspectives, 19, 25-42.
8. * Galotti, K. M. (2007). Decision structuring in important real-life choices.
Psychological Science, 18, 320-325.
9. Gawande, A. (2007). The checklist. The New Yorker.
10. * Gilovich, T., Vallone, R., & Tversky, A. (1985). The hot hand in basketball: On
the misperception of random sequences. Cognitive Psychology, 17, 295-314.
11. Gladwell, M. (2009, July 27). Cocksure: Dept. of finance. The New Yorker, 85(22),
24.
12. * Gladwell, M. (2008). The ethnic theory of plane crashes. In M. Gladwell
(author), Outliers: The story of success (pp. 177-223). New York: Little, Brown, and
Company.
13. Gladwell, M. (2004). Personality plus. The New Yorker, September 20.
14. Gladwell, M. (2002). Blowing Up. The New Yorker. April 22 and 29, 162-173.
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15. Groopman, J. (2007). What’s the trouble? The New Yorker, January 29.
16. Hardman, D. & Harries, C. (2002). How rational are we? The Psychologist, 15(2),
76-79.
17. Hyashi, A.M, (2001, February). When to trust your gut. Harvard Business Review,
59-65.
18. * Kruger, J., Savitsky, K., & Gilovich, T. (1999). Superstition and the regression
effect. Skeptical Inquirer, 23, 24-29.
19. Lehrer, J. (2008, July 28). The eureka hunt. The New Yorker, 40-45.
20. * Lovallo, D., Viguerie, P., Uhlaner, R., & Horn, J. (2007, December). Deals
without delusions. Harvard Business Review, 92-99.
21. * Milkman, K.L., Chugh, D., & Bazerman, M.H. (2009). How can decision making
be improved? Perspectives on Psychological Science, 4, 379-383.
22. * Milkman, K.L., Rogers, T., & Bazerman, M.H. (2008) Harnessing our inner
angels and demons: What we have learned about want/should conflicts and
how that knowledge can help us reduce short-sighted decision making.
Perspectives on Psychological Science, 3, 324-338.
23. Mishlove, J. To err is human. In ‘The Roots of Consciousness.’
http://www.williamjames.com/Science/ERR.htm.
24. * Myers, D.G. (2002, November/December). The powers and perils of intuition.
Psychology Today, 42-52.
25. * Probst, G., Raisch, S. (2005). Organizational crisis: The logic of failure. Academy
of Management Executive, 19, 90-105.
26. Reilly, R.R. (2010). Introduction to probability for decision making.
27. Roberto, M.A., & Carioggia, G.M. (2003). Mount Everest – 1996. Harvard Business
School.
28. * Shih, M., Pittinsky, T. L., & Ambady, N. (1999). Stereotype susceptibility:
Identity salience and shifts in quantitative performance. Psychological Science, 10,
80-83.
29. * Staw, B.M., & Hoang, H. (1995). Sunk costs in the NBA: Why draft order affects
playing time and survival in professional basketball. Administrative Science
Quarterly, 40, 474-494.
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30. * Smithson, M. (2009). Psychology’s ambivalent view of uncertainty. In G.
Bammer & M. Smithson (Eds.), Uncertainty and risk: Multidisciplinary perspectives
(pp. 205-217). Earthscan Publications.
31. Surowiecki, J. (2007, November 19) Striking out. The New Yorker.
32. * Willis, J., & Todorov, A. (2006). First impressions: Making up your mind after a
100-ms exposure to a face. Psychological Science, 17, 592-598.
33. Begley, S. (2010, August 5). The limits of reason: Why evolution may favor
irrationality. Newsweek,
http://www.newsweek.com/search.html?q=The+limits+of+reason
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Assignments
The course will emphasize class discussion focused around the exercises and the
analysis of the text and other assigned readings. Students are expected to be prepared to
discuss the assigned readings as well as concepts and examples in the text. Two papers
(each analyzing decision making cases) are assigned plus an original final case study.
Class Participation
To enhance the learning experience for everyone, all students are expected to participate
in class discussions and team exercises. Attendance is an important component of this
grade. In addition, each student will prepare and deliver a brief presentation on one of
the assigned readings.
The assignments and their weights are as shown below:
Assignment
Grade
Percent
Case Study I
25%
Case Study II
25%
Final Presentation
35%
Article Presentation and Class Participation
15%
Total Grade
100%
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Ethical Conduct
The following statement applies to all students taking Stevens courses, on and off
campus.
Cheating during in-class tests or take-home examinations or homework is, of course,
illegal and immoral. A Graduate Academic Evaluation Board exists to investigate
academic improprieties, conduct hearings, and determine any necessary actions. The
term ‘academic impropriety’ is meant to include, but is not limited to, cheating on
homework, during in-class or take home examinations and plagiarism.
Consequences of academic impropriety are severe, ranging from receiving an ‘F’ in a
course, to a warning from the Dean of the Graduate School, which becomes a part of the
permanent student record, to expulsion.
Reference:
The Graduate Student Handbook, Academic Year 2003-2004 Stevens
Institute of Technology, page 10.
Consistent with the above statements, all homework exercises, tests and exams that are
designated as individual assignments MUST contain the following signed statement
before they can be accepted for grading.
_______________________________________________________________________
I pledge on my honor that I have not given or received any unauthorized assistance on
this assignment/examination. I further pledge that I have not copied any material from
a book, article, the Internet or any other source except where I have expressly cited the
source.
Signature _______________________________________
Date: _____________
Please note that assignments in this class may be submitted to www.turnitin.com, a
web-based anti-plagiarism system, for an evaluation of their originality.
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Topic
Course
overview
Randomness
and statistical
models
Common biases
Course Schedule
Readings and other activities
Power Point slides
Readings: 1, 4, 10, 14, 26
Prisoner’s dilemma game
Questions for common biases and framing in decision
making
Power Point slides
Bazerman & Moore Chapters 1 and 2
Readings: 7, 8, 9, 15, 16, 18, 20, 23, 30
Framing and the Power Point slides
reversal of
Bazerman & Moore Chapter 4
preferences
Readings: 22, 29
Tenerife video
Non-rational
escalation of
commitment
Group decision Power Point slides
making
Readings: 12, 25, Mt. Everest case (27)
Leaderless group discussion
Winter survival exercise
Motivational
Power Point slides
and emotional
Bazerman & Moore Chapter 5
influences on
Readings: 2, 3, 5, 11, 13, 28, 32
decision making Tenerife and Mt. Everest paper due
Class exercise (handout)
Implicit association test (IAT)
https://implicit.harvard.edu/implicit/
Fairness and
Power Point slides
ethics in
Bazerman & Moore Chapter 7
decision making Readings: 6, 17, 19, 24, 31
Cuban missile crisis video
Intuition
Negotiations
Power Point slides
Bazerman & Moore Chapters 9 and 10
Papa Pagone’s negotiation
Arak-Barkan negotiation
Student case presentations
Improving
Power Point slides
decision making Bazerman & Moore Chapter 11
Readings: 21, 33
Student case presentations
Paper on Cuban missile crisis due
Session
Session 1
(1/18)
Session 2
(2/1)
Session 3
(2/8)
Session 4
(2/22)
Session 5
(3/8)
Session 6
(3/22)
Session 7
(4/5)
Session 8
(4/26)
(4/30)
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Presentations on Assigned Readings
Each week one or more readings will be assigned to one or two students. Prepare a 10to 15-minute presentation on each reading. Do not try to present all the details about the
article; only present sufficient information that we will all understand the key
findings/points.



Summarize the article
What are the essential points made by the author?
Discuss the implications of the article for decision making
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Cuban missile crisis
Write a report analyzing the decisions made in the Cuban Missile crisis. Your report
should utilize the concepts covered by Bazerman and the assigned readings to answer
the following questions. The report should be no longer than 5 double-spaced pages.
1. What were the major issues to be decided?
2. What were the major sources of uncertainty?
3. What were the key decisions made during the crisis?
4. How did framing affect the decision makers and the decision process?
5. To what extent did the decision makers generate alternatives?
6. Describe the decision-making process used by President Kennedy?
7. What were the key sources of influence on the ultimate decision?
8. In retrospect, could a better set of decisions have been made from the U.S.
perspective?
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Tenerife and Mt. Everest
After viewing the Tenerife video and reading the Mt. Everest – 1996 case, prepare a
report that describes …

The individual-level decision making biases that contributed to the disasters

The team-level factors (or processes) that contributed to the disasters

The systems-level factors that contributed to the disasters
Be sure to emphasize the similarities in individual-level, team-level, and systems-level
factors that contributed to both disasters.
The report should be no longer than 5 double-spaced pages.
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EMT 635 Spring 2014
Name:
Prefer to be called?
Your e-mail address?
Your work or home phone number (optional):
Your undergraduate major?
If you have another graduate degree, what was your major?
Years of full-time work experience?
Brief description of current job?
Have you or do you now supervise others? If yes, indicate number of years of
supervisory experience and number of people you supervised.
Career goal after graduation?
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