Stevens Institute of Technology
Howe School of Technology Management
MGT 635
Managerial Judgment & Decision Making
Semester: 2014
Peter G. Dominick, Ph.D.
[email protected] or
[email protected]
Office Hours:
Before or after class and by appointment
This course acquaints you 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.
Course Objectives
The course’s goal is to provide insights and tools that will enable you to support and
improve your own decision making, to understand the decision making of others, and to
enhance the decision quality of team and groups that you lead.
Additional AACSB learning objectives supported in this course include:
 Communications skills: Students develop and present original case studies of
major decisions in class which incorporate some of the major issues covered in
the course and demonstrate their understanding of the principles of judgment
and decision making. The course incorporates a written assignment which is
assessed by faculty from the College of Arts & letters (CAL) using Learning Goal 1,
Rubric 1.
 Collaborate and Lead Teams: Students analyze and practice decision making
using realistic case studies and role playing exercises. The cases and exercises
allow students to demonstrate understanding of influences on judgment and
EMT 635 Managerial Judgment &
decision-making, examine how effective decisions are made by individuals and
groups and learn the role that leadership plays in helping teams make effective
Ethics: The course covers fairness in decision making, drawing the distinctions
among distributive, procedural, and interactional justice (using compensation
decisions as an example). Second, it includes discussion on bounded ethicality,
which is the idea that many unethical decisions can arise due to biases that are
outside of our conscious awareness. To reinforce this concept, students
complete an implicit association test, which reveals biases that are the
‘thumbprint of our culture’ despite our explicit desire to avoid such biases.
ASSESSMENT: All students enrolled in MGT 635 take an ethics quiz.
Learning Goals
After taking this course, the you will be able to:
Understand and 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
5. Apply models to make decisions under uncertainty and crisis
6. Understand and apply principles of conflict and negotiation
EMT 635 Managerial Judgment &
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 decision-making exercise, , a twoperson negotiation exercise, and a variety of case examples.
You 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, the 1996 Mt. Everest disaster
and the loss of the Space Shuttle Columbia. 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. You 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.
Required Text
Text: Bazerman, M.H., & Moore, D.A. (2013). Judgment in Managerial Decision Making, 8th ed.,
HBs Coursepack link:
Week 2
1. Belkin, L. (2002). The odds of that. The New York Times Magazine, August 11.
2. Gilovich, T., Vallone, R., & Tversky, A. (1985). The hot hand in basketball: On the
misperception of random sequences. Cognitive Psychology, 17, 295-314.
3. Gladwell, M. (2002). Blowing Up. The New Yorker. April 22 and 29, 162-173.
4. Reilly, R.R. (2010). Introduction to probability for decision making.
Week 3
5. Galotti, K. M. (2007). Decision structuring in important real-life choices. Psychological
Science, 18, 320-325.
6. Groopman, J. (2007). What’s the trouble? The New Yorker, January 29.
7. Hardman, D. & Harries, C. (2002). How rational are we? The Psychologist, 15(2), 76-79.
8. Kruger, J., Savitsky, K., & Gilovich, T. (1999). Superstition and the regression effect. Skeptical
Inquirer, 23, 24-29.
9. Mishlove, J. To err is human. In ‘The Roots of Consciousness.’
10. Stanovich, K.E. West, R.F., Toplak, M.E. (2013). My side bias, rational thinking & intelligence.
Current directions in psychological science. 22(4), 259-269.
Week 4
EMT 635 Managerial Judgment &
11. Bohmer, R.M., Edmondson, A.C., & Roberto, M.A. (2009). Columbia’s Final Mission
(Multimedia Case). HBS Publishing #305-032.
12. Gawande, A. (2007). The checklist. The New Yorker.
13. Probst, G., Raisch, S. (2005). Organizational crisis: The logic of failure. Academy of
Management Executive, 19, 90-105.
14. Rosenzweig, P. (2013). What makes strategic decisions different? Harvard Business Review,
November. 88-93.
15. Vaughan, D. (1997). The trickle-down effect: Policy decisions, risky work, and the Challenger
tragedy. California Management Review, 39(2), 80-102.
Week 5
16. 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
17. 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, 324338.
18. 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.
Week 6
19. Roberto, M.A. (2002). Lessons from everest: The interaction of cognitive bias, psychological
safety and system complexity. California Management Review, 45(1), 136-158, CMR245.
Week 7
20. Bruck, C. (2009). Angelo’s ashes. The New Yorker, June 29.
21. Eden, D., & Shani, A. B. (1982). Pygmalion goes to boot camp: Expectancy, leadership, and
trainee performance. Journal of Applied Psychology, 67(2), 194-199.
22. Gladwell, M. (2004). Personality plus. The New Yorker, September 20.
23. Shih, M., Pittinsky, T. L., & Ambady, N. (1999). Stereotype susceptibility: Identity salience
and shifts in quantitative performance. Psychological Science, 10, 80-83.
Week 8
24. 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.
25. Zhang, S., Cornwell, J.F., & Higgins, E.T. (2013). Repeating the past: Prevention focus
motivates repetition, even for unethical decisions. Psychological Science, November.
Week 10
26. Hyashi, A.M, (2001, February). When to trust your gut. Harvard Business Review, 59-65.
27. Lehrer, J. (2008, July 28). The eureka hunt. The New Yorker, 40-45.
28. Myers, D.G. (2002, November/December). The powers and perils of intuition. Psychology
Today, 42-52.
29. Willis, J., & Todorov, A. (2006). First impressions: Making up your mind after a 100-ms
exposure to a face. Psychological Science, 17, 592-598.
Week 12
30. Begley, S. (2010, August 5). The limits of reason: Why evolution may favor irrationality.
31. Bhide, A. (2010). The Judgment deficit. Harvard Business Review. Sept. 44-53.
EMT 635 Managerial Judgment &
32. Milkman, K.L., Chugh, D., & Bazerman, M.H. (2009). How can decision making be improved?
Perspectives on Psychological Science, 4, 379-383.
EMT 635 Managerial Judgment &
The course will emphasize class discussion focused around the exercises and the analysis of the
text and other assigned readings. You 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, you 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
The assignments and their weights are as shown below:
Case Study I (see page 6)
Case Study II (see page 6)
Final Presentation (see page 6)
Article Presentation and Class Participation (see page 6)
Total Grade
EMT 635 Managerial Judgment &
Course Schedule
Readings and other activities
Course overview
Session 1
Randomness and statistical
Everyone read: 4 –Reilly, Introduction to
Probability for Decision-making
Short Presentation Readings Choices: 1-3
Common Biases & Framing
Everyone Read: Bazerman & Moore Chapters 1,2,4
Short Presentation Readings Choices: 5-10
System Complexity &
Everyone Read: 10 – Bohmer, et. al. Columbia’s
Decision Failures
Final Mission (DVD) ; 16-Vaughn, The Trickle Down
Short Presentation Readings Choices: 11-14
Non-rational escalation of
Everyone Read: Bazerman & Moore Chapter 7
Short Presentation Readings Choices: 16-18
Tenerife: The Deadliest Plane Crash - NOVA
Group decision making
Everyone Read: 20. Roberto, M.A. (2002). Lessons
from everest.
Everest Simulation in class
Motivational and emotional
Everyone Read: Bazerman & Moore Chapter 6
influences on decision making Short Presentation Readings Choices: 20-23
Session 2
Fairness and ethics in
decision making
Everyone Read: Bazerman & Moore Chapter 8
Short Presentation Readings Choices: 24-25
Session 8
Decision Dynamics
Tenerife, Columbia and Mt. Everest paper due
Session 9
Session 3
Session 4
Session 5
Session 6
Session 7
Cuban Missile Crisis video
Short Presentation Readings Choices: 26-29
Implicit association test (IAT)
Everyone Read: Bazerman & Moore Chapters 10
and 11
ARAK simulation
Improving decision making
Wrap-up and Catch up
discussions if needed
Everyone Read: Bazerman & Moore Chapter 12
Short Presentation Readings Choices: 30-32
Student Case Presentations
Student Case presentations (Continued)
Paper on Cuban missile crisis due
Intuitive judgment &
improvisational thinking
Decision making in
EMT 635 Managerial Judgment &
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 so that we will all understand the key
 Summarize the article
 What are the essential points made by the author?
 Discuss the implications of the article for decision making
Case Study 1: Columbia, Tenerife and Mt. Everest
After learning about the Columbia’s final mission, the air disaster at Tenerife , and the
events on Mt. Everest in 1996, prepare a report that compares and contrasts two of
these events.
 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 doublespaced pages.
Case Study 2: 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 35 of the following questions. The report should be no longer than 5 double-spaced
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.
Final Presentation
The final project requires developing an original case study of a decision, including the
context, background, decision, and aftermath. You must use decision-making concepts
from the course to describe and analyze the case (15-20 minutes). Each student will
make a formal presentation of the case and will answer questions from the class and
professor. This can be a team presentation.
EMT 635 Managerial Judgment &
Ethical Conduct
The following statement applies to all students taking Stevens courses, on and off
“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.
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
Signature _______________________________________ Date: _____________
Please note that assignments in this class may be submitted to, a
web-based anti-plagiarism system, for an evaluation of their originality.