The University of Southampton
Courses

MANG6134 Risk Taking and Decision Making

Module Overview

The module seeks to familiarise you with a range of decision-making processes and models, to provide you with the knowledge necessary to know how and when to apply them and to increase your awareness of the factors influencing risk taking behaviour. In addition, the module will introduce an inter-disciplinary approach to decision-making and will explore how to structure decisions and how to explicitly account for (i) uncertainty in the decision environment and (ii) behavioural aspects of risk.

Aims and Objectives

Module Aims

This module aims to develop your decision making and risk taking capabilities. The module seeks to familiarise you with a range of decision-making processes and models, to provide you with the knowledge necessary to know how and when to apply them and to increase your awareness of the factors influencing risk taking behaviour. In addition, the module aims to encourage you to adopt an inter-disciplinary approach to decision-making, to instill in you an appreciation of how to structure decisions and how to explicitly account for (i) uncertainty in the decision environment and (ii) behavioural aspects of risk.

Learning Outcomes

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

  • Appreciate the central role of decision making and risk taking in effective management;
  • Understand the importance of underlying assumptions in decision models and the importance of individual differences in risk taking behaviour;
  • Appreciate the relative strengths of decision models and be able to apply them in a systematic manner;
  • Appreciate the importance and relative advantages of both objective and subjective information;
  • Appreciate the factors influencing individual differences in risk taking and the nature of risk taking behaviour in groups.
Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

  • Critically evaluate the relative strengths of a variety of decision making techniques;
  • Generate appropriate subjective probability estimates.
  • Analyse decision problems using a systematic and inter-disciplinary approach and justify this approach;
  • Apply appropriate decision making models in order to select optimal strategies in situations involving uncertainty;
  • Critically evaluate the role of information in improving managerial decisions;
  • Be capable of communicating issues and difficulties of applying decision models;
  • Structure a decision coherently and effectively;
  • Interpret the results of a decision analysis;
  • Apply appropriate decision models in competitive situations;
  • Identify, characterise and reduce the impact of biases in decision-making caused by Heuristics;
Transferable and Generic Skills

Having successfully completed this module you will be able to:

  • Make effective decisions.

Syllabus

- The nature of decision-making and decision modelling - Structuring a decision - Decision models to handle uncertainty - Decision models to handle risk - Risk attitude and utility - Individual differences in risk taking - Group risk taking - Subjective judgments, heuristics and biases - Subjective probability elicitation - The role and value of information in improving decisions - Decision making in a competitive environment

Learning and Teaching

Teaching and learning methods

The module is taught via a series of 2 hour lectures. These will be interactive sessions with students expected to engage via a series of class and group-based exercises, providing students with the opportunity of practising the techniques introduced. Performance in these tasks will also provide a form of formative feedback to help students know their areas of strength and weakness on the module materials. Students will be expected to read the core text and practice examples provided in this text. In addition, each student will be provided with a workbook, which will provide a summary of the lecture material and will contain a number of exercises for the students to attempt. This will help them practice the techniques discussed in lectures. Solutions to these exercises will be provided to enable students to identify areas of the module in which they are strong and those where they need to undertake more study. Students will be provided with a list of articles and chapters from text books to read for each topic studied on the module.

TypeHours
Independent Study126
Teaching24
Total study time150

Resources & Reading list

G. Salaman (2002). Decision Making for Business. 

A. Kelly (2002). Decision Making using Game Theory: An Introduction for Managers. 

M. Bazerman (2005). Judgement in Managerial Decision Making. 

P. Goodwin & G. Wright (2009). Decision Analysis for Management Judgement. 

S.Cooke and N.Slack (1991). Making Management Decisions. 

Assessment

Formative

Class Exercise

Summative

MethodPercentage contribution
Examination  (2.25 hours) 100%

Repeat

MethodPercentage contribution
Examination  (2.25 hours) 100%

Referral

MethodPercentage contribution
Examination  (2.25 hours) 100%

Repeat Information

Repeat type: Internal & External

Costs

Costs associated with this module

Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.

In addition to this, students registered for this module typically also have to pay for:

Textbooks

Recommended texts for this module may be available in limited supply in the University Library and students may wish to purchase the core/recommended text as appropriate.

Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at www.calendar.soton.ac.uk.

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