BUAD 304 - Chpt 5 Case Incident 1 Natural Disasters and the Decisions that Follow

BUAD 304 - Chpt 5 Case Incident 1 Natural Disasters and the Decisions that Follow

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Ted Tao 09/15/08 Jody Tolan Mon. 2 pm – 4 pm 1). Rommel was given the tough choice of having to deal with an unpredictable natural disaster. He based his decision on an utilitarianism, where the most efficient business practices is valued. In following this thought Rommel was able to justify his action, by stating that it was for the best interest of the company to cancel the insurance policies of the homeowners, despite homeowner’s complaints. Furthermore this way of thinking also allows Rommel to rationalize his decision and not feel guilty for it. 2). Some common sense decision making biases for these firms include not being overconfident in their current emergency counteraction plan. This was seen in Jet Blue’s case when they believed the predictability of severe weather storms makes them easy to prepare for. However due to their overconfidence they did not have proper procedure set up to during these storms and they had to pay for it. A second base is that these companies should not focus on the availability bias. Although natural disasters occur,
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