Reference no: EM133242180

Rational decision-making model and heuristics

Consider the following decision scenario:

In making a hiring decision, supervisors often face difficult issues.

Your company is advertising for a new employee to work in your department. The person in this position will be important because the work directly affects the quality and quantity of your performance. One of your friends or colleagues from you're your MBA program needs a job and you think they may be qualified for the position. But you feel you could find better qualified and more experienced candidates if you keep looking.

What do you do? What might influence your decision? Would you tell your friend? How would you handle this sensitive situation? What are the ethical implications of your decision?

Since this is an open scenario, you are free to make assumptions and add necessary information (type of job, industry, location, etc). When making assumptions, clearly state your rational behind each assumption.

Question 1) Use the decision matrix to make a rational decision.
• Identify at least 5 decision criteria, define each criterion according to your preference and assign weight.
• Try your best to collect as much real-world data as possible and evaluate/rate each alternative across each criterion.
• Choose the option with the highest score.
Briefly explain and justify each step in your decision matrix.

Question 2) Due to variety of reasons (time pressure, bounded rationality, etc), it is hard to perfectly apply the rational decision-making model to decisions. Instead, the textbook talks about the four decision heuristics (decision shortcuts) people may use to make decisions: Availability, Representativeness, Confirmation and Affect heuristic.

For the same scenario in Question 1, discus how the decision making might use each heuristic and the potential benefits/problems of using each heuristic. Support your answers from research.