Decision Making Decision-Making Style Summary

Decision Making

Section One – Decision-making Style Summary

“Since Plato, philosophers have described the decision-making process as either rational or emotional: we carefully deliberate or we ‘blink’ and go with our gut” (Lehrer, 2009). In the rational decision-making model, the method “involve[s] a cognitive process where each step follows in a logical order from the one before” (McDermott, n.d.). McDermott (n.d.) suggests that “some people assume that decision making is equivalent to problem solving. Problem solving can also be described as “the process of analyzing the situation and developing a solution to bridge the gap” (Encyclopedia of management, 2012). It can be said that this approach is similar to the scientific method widely used in the physical sciences (Encyclopedia of management, 2012). They are analogous in the fact that “the purpose underlying the analytic process is to minimize the influence of the investigator’s personal biases, maximize the likelihood of an accurate result, and facilitate communication among affected parties” (Encyclopedia of management).

Bauer and Erdogan (2013) illustrates the rational decision making model into eight steps: identifying the problem, establishing decisions criteria, weighing decision criteria, generating alternatives, evaluating the alternatives, choosing the best alternative, implementing the decision, and evaluating the decision. In the basic problem-solving model the stages are as following: problem identification, problem verification, problem definition, root-cause analysis, alternative generation, evaluation of alternatives, implementation, postimplementation review, and institutionalization and control (Encyclopedia of management, 2012).

Problem identification is key in rational decision making because “a firm’s problem identification method should strive to present an accurate assessment of the problems and opportunities facing the firm” (Encyclopedia of management, 2012). In the next stage, problem verification is “essentially important when a manager is asked to step in and solve a problem that has been identified by someone else” (Encyclopedia of management, 2012). The following step “is to formally define the problem to be addressed….[which] is a negotiation between the individuals tasked with solving the problem and the individuals who oversee their work” (Encyclopedia of management, 2012). Next, “the ultimate goal is to uncover the root cause or causes of the problem” (Encyclopedia of management, 2012). The next stage of the problem-solving process is a creative one in which the problem-solver must generate alternative approaches to prevent, eliminate, or control the root causes of the problem (Encyclopedia of management, 2012). Afterward, the problem-solver “may want to consider both the tangible and intangible benefits and costs of each alternative” (Encyclopedia of management, 2012). Where most managers fail is during the implementation stage of the problem-solving process. Once a plan of action is produced, “it should continue to receive the necessary attention and support to achieve success” (Encyclopedia of management, 2012). It is also recommended to have a review of the previous course of action, which “may also provide valuable insights into the firm’s problem solving process itself” (Encyclopedia of management, 2012). Lastly, “the final step in problem solving is to institutionalize the results of the initiative….by amending policy manuals, establishing new control measures, or even rewriting job descriptions.” (Encyclopedia of management, 2012). The overall success of problem-solving or rational decision-making activities “is determined by the levels of anticipatory mechanisms and subsequent response measures set up by the management of the organizations” (Encyclopedia of management, 2012).