Decision Making

Many executive decision-making systems are based on the rational optimizing model: that people determine the need for a decision, recognize the decision criteria, and allocate weights to the criteria, develop the alternatives, appraise the alternatives, and then select the best alternative in a rational, fact-based approach.  As early as the 1950s, the strength of this principle was challenge by March and Simon, who saw that many decisions were in fact based on unreasonable processes and building. Intuitively, we know that very few people are completely rational in their decisions-we make a lot of choices based on emotion, on avoid risk, on not losing face, and so on-so it is hardly surprising to discover that similar, non coherent elements enter into decision making in the workplace. Some elements that we will look at in this segment include: heuristics, selective discernment, increasing commitment, misunderstanding of probability, anchor, and framing.