1242.docx - and failings He cited the following constraints...

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and failings. He cited the following constraints faced by decision-makers when applying the rational model in their decision making process: Inadequate information about the nature of the problem and its possible solution; The lack of time or money to compile more complete information; Distorted perceptions of the information available; The inability of the human memory to retain large amounts of information; and The limits of their own intelligence to determine correctly which alternative is best The bounded rationality model recognizes the limitations of the individual's rationality. Due to constraints, the management's decision making is rarely optimal in the sense of the best solution being sought. In practice, the decision-maker does not maximize utility but rather satisfies. This means that the rational decision-maker searches for an acceptable choice, one that satisfies a minimal set of requirements. Instead of reviewing all possible
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