Chapter 4: Managing Decision Making

Complete set of links to companies

Virtually every important decision made in today’s corporations is the result of a group decision-making process. Xerox is one company that has enthusiastically embraced participation in decision making. Examine Xerox’s web site, and then answer the following questions:

1. As compared to decision making by individuals, in what ways would you expect Xerox to benefit from group decision making?
2. As compared to decision making by individuals, what are some of the potential pitfalls of group decision making that Xerox might experience?

Internet Exercise

Aetna insurance company is the subject of the Chapter 4 closing case (found on page 118 of your text). Difficulties in decision making, including uncertain costs and legal problems, have been reducing Aetna’s earnings over the last several years. Go to Aetna’s Investor Information page, and find current news about the firm, including their most recent quarterly earnings report. Then answer the following questions:

1. Based on what you discovered from their web site, has Aetna’s decision-making situation improved since 1999?
2. Based on information from their web site, do you think Aetna’s performance is likely to improve in the future?
3. In your opinion, what would be required to turn Aetna’s decision making into an asset for the company? You should consider such factors as time, decision-making skills and experience, access to timely and accurate information, and more.

Explore Further

Aetna was once a diversified insurance firm, offering life, property, and other forms of insurance in addition to health. Compare Aetna’s situation with that of a close competitor, CIGNA, which remains diversified. In particular, look for CIGNA’s most recent quarterly earnings. On the two firms’ web sites, can you find any clues to explain performance differences?