Kleinmuntz 1990 shares this perspective he suggests

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: c judgements will deteriorate as the number of possible outcomes increases because of the limits on human information processing capabilities. Whereas he argues, systematic decomposition relaxes the information processing demands on the decision-maker reducing the amount of potential error in human judgement. Furthermore, since decompositional methods provide an “audit trail” it is possible to use them to produce a defensible rationale for choosing a particular option. Clearly this can be important when decisions have to be justified to senior staff, colleagues, outside agencies, partners, the general public, or even to oneself (Goodwin and Wright, 1991). Since its conception the role of decision analysis has changed. No longer is it seen as a method for producing optimal solutions to decision problems. As Keeney (1982) points out: “Decision analysis will not solve problems, nor is it intended to do so. Its purpose is to produce insight and promote creativity to help decision-makers make better decisions.” (Goodwin and Wright, 1991 p4) This changing perception of decision analysis is also emphasised by Phillips (1989): “…decision theory has now evolved from somewhat abstract mathematical discipline which when applied was used to help individual decision-makers arrive at optimal decisions, to a framework for thinking that enables different perspectives on a problem to be brought together with the result that new intuitions and higher level perspectives are generated.” (Goodwin and Wright, 1991 p4) However, whilst decision analysis does not produce an optimal solution to a problem, the results from the analysis can be regarded as “conditionally” prescriptive which means that the analysis will show the decision-maker what they should do, given the judgements that have been elicited from them during the course of the analysis. The fundamental assumption underlying this approach is that the decision-maker is 24 rational (Goodwin and Wright, 1991). When a decision-maker acts rationally it means that they calculate deliberately, choose consistently, and maximise, for example, their expected preference/utility. Consistent choice rules out vacillating and erratic behaviour. If it is assumed that managerial decision-makers want to maximise, for example, their personal preferences, and that they perceive that this will happen through maximising the organisation’s objectives, then it may also be assumed that such managers will pursue the maximisation of the organisation’s performance in meeting its objectives (Harrison, 1995 p81). More simply, if managers are rewarded based on the organisation’s performance and they behave rationally, they will try to maximise the outcome of their decisions for the organisation, to achieve the highest amount of personal utility. For many years it was believed, implicitly or explicitly, that such normative theories of decision-making not only represent the “ought” but also the “is”: the normative and descriptive facets were assumed to be one and the same (Keren, 1996). The unprecedented advancements in the phys...
View Full Document

This document was uploaded on 03/30/2014.

Ask a homework question - tutors are online