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Margulan Abzalov
As outlined in M. Bazermans book Judgment in Managerial Decision Making, every agreement
one proposes must be clearly framed towards the audience and expected outcome should be
clear.
Numerous studies have proven the fact that in majorly we will select alternatives with highest
expected values. Despite all the circumstances most people will change their choices from risk
averse to risk-seeking once we manipulate with the description of outcomes.
This chapter also cover the interesting rational between your mental models when one will easily
accept paying a premium for commodity when you have to buy it at upscale hotel, vs resistance
to pay the same money for the same product in rundown gas station.
In Chapter 7 we drill in to other possible decision drivers when we are faced with series of
choices and cant commit to isolated decision. Case describes very relevant real world examples
where managers decisions are driven by previously made choice and commitments. In many
circumstances these blind choices are leading to major wreck, so it is important to learn where to
stop a pattern or where management must decide to swap a decision maker to stop a pattern.
The same trend of decision making is also observed shall our choices to be limited once we have
entered in to competitive escalation paradigm.
Another trap we quite often fall is called impression management, where our decision making are
driven by attempt to save a face and or appear consistent in choices to others.
Overall I found both chapters as very thoughtful and interesting reading, really looking forward to
read all chapters on any nearest opportunities.

Bad Blood article is very disturbing story about how things can turn out very sad shall companies
allow low ethical standards and poorly designed incentives to mix together. Coming from
developing country in to US, I was always feeling much secure here dealing with health
organizations assuming the top notch levels of controls installed to assure the safest treatment
environment possible up to highest industry standards. I also always supported all my employer
driven blood drives and have donated blood personally at every opportunity.
Case describes all major reckless violations from critical procedures which become a norm in
blood center. We are introduced to all of the realities of blood supply business and drivers behind
certain behaviors of front line employees and their supervisors. It is not an easy task to
implement internal controls on heavily labor involved processes where all readings can be
forged/faked.
The serious malfunction and poor ethical standards are hard to hide, and those will definitely
become public information, the only question then will be what is a potential for harm

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Margulan Abzalov
Chapter 10: Incentive Conflicts and Contracts describes various approaches to contracting.
Contract types reviewed are covering a wide range of relationships existing in our complex
business world in areas from HR, consulting, services and real-estates. Case provides a base
for understanding of a various value propositions promoted by each side of the contracting
parties and all rational behind it.
The case carefully analyses the rational around: Do the managers always contribute to the
success of the firm and what are those signs of incentives conflicts which may exist and lead to
diminishing performance? What is a difference between formal and implicit contracts which are
exists at workplace?