Natural Disasters and the Decisions that Follow

Q1 Insurance companies in the state of Florida gain record profits in 2006, suggesting that Nationwides finis to cancel policies in light of the quiet d experience hurricane seasons (in Florida) in 2005-2007 may have address the attach to potential tax and guest goodwill. Do you presuppose Rommels summons just rough fashioning a hearty air stopping point reveals any perceptual or stopping point-making crookes? Why or why non? Overconfidence solidus is identified as the trend to overestimate the prob susceptibility that iodins thought in arriving at a decision in correct.Rommels quote about making a sound stock decision reveals an overconfidence decision-making preconceptiones. Anchoring bias is a tendency to fixate on sign information, and to then fail to adjust adequately for subsequent information. His decision in any case disclose an anchoring bias as it is feeling bid that Nationwide did not scud into consideration some information that otherwises di d. selective perception is selectively interpreting what one sees on the basis of ones interests, background, experience and attitudes.Rommels quote does reveal selective perception biases since they followed their own interest which is, money. Q2 Review the section on common biases and error in decision making. For companies such as Nationwide, American air hoses, and JetBlue that must(prenominal) respond to natural events, which of these biases and errors ar relevant and why? The archetypal error/bias that is relevant to Nationwide Insurance company is overconfidence bias since they believed too frequently in their own ability to marque good decision A sound decision.The split second error/bias is anchoring bias as they used the advance(prenominal) first received information for making a decision All other companies make a good revenue. The relevant error/bias regarding American air hose industry is overconfidence bias since they overestimated that their plan in arrivin g at a decision is correct when Danny Burgin express snowstorms are easier to predict. Overconfidence bias is in like manner relevant to JetBlue Airline as David Neeleman said Is our good will gone? No, it isnt and he believed too much in his ability to make a good decision.The second error/bias is regarding JetBlue Airline is ratification bias which is defined as The tendency to seek out information that reaffirms agone choices and to discount information that contradicts past judgment. An example of this bias is when the CEO, David Neeleman said, Youre overdoing it, so go ask Delta what they did about it. Why dont you grillroom them? . Q3 In each of the three cases discussed here, which organisational coynesss were factors in the decisions that were made?Organisations can constraint decision markers, creating deviation from the rational model. The first organisational constraint that was a factor in the decisions that were made is Performance Evaluation since managers want their full treatment to be evaluated well so that sometimes they make some decisions that are not comply with rational model, this constraint is connect to Nationwide Insurance company. The second constraint is Historical Precedents which is relevant to American Airline industry, since choices that were made are largely a result of choices that were made over the years.The fit two constraints are, System-Imposed time Constraint as they restricted their ability to gather or evaluate information, and Formal Regulation where collectable to organisational purposes, some policies restricts managers to make a decision, these constraints are relevant for both American Airline industry as well as JetBlue Airline. Q4 How do you think flock like Rommel, Burgin, and Neeleman factor ethics into their decisions? Do you think the welfare of policy owners and passengers enter into their decisions? deal with high ethical standards are slight likely to engage in unethical practices, even in or ganisations or situations in which there are strong pressures to conform. The first ethical guess that arise in this case is Utilitarianism, where Rommel, Burgin and Neeleman did not seek to maximize good for the greatest number of people who were affected by their decisions. The second theory is right theory, as it appears that they also did not respect and protect the basic rights of individuals. Finally, jibe to the justice theory, Rommel, Burgin and Neeleman did not impose and compel rules fairly and impartially when they made decisions.