CSM Problem Solving & Decision Making 3 — Questions and Answers
Question 1: Which problem-solving model follows the sequence: Define, Measure, Analyze, Improve, Control?
- PDCA Cycle
- DMAIC (Correct answer)
- OODA Loop
- Design Thinking
Correct answer: DMAIC
DMAIC is a data-driven Six Sigma improvement cycle used to optimize and stabilize business processes.
Question 2: A strategic manager uses a Pareto analysis when prioritizing problems. The underlying principle is that:
- All problems contribute equally to outcomes
- 20% of causes typically drive 80% of effects (Correct answer)
- Problems should be solved in the order they appear
- Qualitative factors outweigh quantitative ones
Correct answer: 20% of causes typically drive 80% of effects
Pareto analysis applies the 80/20 rule to identify the vital few causes responsible for the majority of problems.
Question 3: Groupthink most commonly occurs in organizational decision making when:
- Teams include members with diverse expertise
- Cohesive groups prioritize harmony over critical evaluation (Correct answer)
- Leaders actively solicit dissenting opinions
- Decisions are made under time pressure alone
Correct answer: Cohesive groups prioritize harmony over critical evaluation
Groupthink develops in highly cohesive teams where the desire for consensus suppresses individual critical thinking and dissent.
Question 4: The nominal group technique (NGT) differs from standard brainstorming primarily because it:
- Encourages free verbal idea sharing
- Structures individual idea generation before group discussion and voting (Correct answer)
- Requires external facilitation
- Focuses exclusively on financial problems
Correct answer: Structures individual idea generation before group discussion and voting
NGT separates individual silent idea generation from group discussion, then uses structured voting to rank ideas and reduce dominant-voice bias.
Question 5: A manager applies multi-criteria decision analysis (MCDA) to a vendor selection problem. The primary advantage of MCDA over simple cost comparison is:
- It eliminates subjectivity entirely
- It simultaneously weighs multiple quantitative and qualitative criteria (Correct answer)
- It requires less data
- It always produces a single clear winner
Correct answer: It simultaneously weighs multiple quantitative and qualitative criteria
MCDA enables structured evaluation across financial, operational, and qualitative criteria, producing a comprehensive comparison rather than a single-metric ranking.
Question 6: In the context of strategic decision making, 'escalation of commitment' refers to:
- Increasing team size to solve complex problems
- Continuing to invest in a failing course of action due to prior investments (Correct answer)
- Escalating a decision to senior leadership
- Expanding the scope of a successful project
Correct answer: Continuing to invest in a failing course of action due to prior investments
Escalation of commitment (sunk cost fallacy) occurs when managers continue investing in failing strategies to justify past expenditures.
Question 7: Which approach best describes 'evidence-based decision making' in strategic management?
- Relying on executive intuition and experience
- Systematically integrating best available data, analytics, and research into decisions (Correct answer)
- Following industry best practices without analysis
- Using historical precedent as the primary guide
Correct answer: Systematically integrating best available data, analytics, and research into decisions
Evidence-based decision making prioritizes rigorous data analysis, relevant research, and empirical evidence over intuition or tradition.
CSM Problem Solving & Decision Making 3
Which problem-solving model follows the sequence: Define, Measure, Analyze, Improve, Control?