decison making Flashcards
(5 cards)
intro
there are 3 main ways to explain through observation the way decisons are made within an orginsation,
the rational model, the aministraive model and the political model.
providing training for managers on decion making techniques can enchance their ability to make decisions aswell as establishing clear objectives and criterias.
this essay looks at why it is so hard do make decisons within these 3 models.
the rational model
the rational model assumes that decion makers have all the information they need and can evaluate all possible opitons logically to choose the best one. and can also be known as programmed decion making refering to decions being made using established guidelines ect.
within the reational decion making model There are 7 steps in the decion making process,
reconise the probelm
set objectives
set and weight decion criteria
develop/idenifty alternitves,
compare and choose,
implement chosen alternitives,
evaluate effectiveness of solution.
which is an itritive process between these steps.
for example A company looking to reduce costs must have a specific cost-reduction goal in mind, such as cutting 10% from their annual expenses, before making a decision.
this means that there are clear objectives and goals for the orginsation, helps evaluate the best choice and the decion maker knows what they want to acheive
however this is not always the case and orginsations rarley have complete information, and the process of gathering can be consuming and costly and slow down the process making it harder for the orginsation to reach there goals
the administive model
offers a more realistic and practical approach, challanging as it relies on satisfing, meaning settiling for a ‘good enough’ option rather than the best one. also known as the non programmed decion based on not having a clear solution or guidelines.
this can lead to missed oppertunitie for optimal outcomes and may be less effecient or effective and potentially have a future impact. especially in rapidly changing enviroments where adapating to things is crucial, this can lead to a compromise on ideal outcome.
for example if setting up a new business you need to choose a new software system for managing in which the manager chose the softwear based on if it meets the basic criteria without searching for the ‘best option’
however bounded rationality a concept developed that suggests human decion making is limited by factors such as, conginitve limitations, time contstaints, ect. suggesting people cannot always make optimal decions so aim for a satisficing decion.
the political model
a framework that highlights how decions are made as a result of negotiation, comprising within a diverse group refering to intrests,values and objectives.
this can be challanging for orginsations as it involves varouis stakeholders with different intrests and power dynamics.
this can lead to power struggles and arguments within an orginsation leading to it being harder to agree on decions. some times decsoins are made to keep powerful groups happy instead of whats best for the business which can slow down the productivity of the business and lead to less effective outcomes
for example investing in a new equiment like a printer, the finacne deparment, managers will want a cost effective basic reliable printer, the employees and IT deparment will want a quick effeient printer that works well with their equiement already.
within the political model it is cruital to avoid group think as it can undermine the effectiveness of the decion making process, as group think is for when everyone keeps peace, however eithin the political model different veiws are important.
conclusion
in conclusion, decion making can be tough due to what these three models show, the rational model is limited by information making it harder for orginsations to make decsions.
administrive model relies on sacrificing making it harder to reach the best outcome,
political model involves different intrests making it difficult to reach a decsion.
