RATIONAL DECISION MAKING
Rational decision making is a decision making model that involves the logical selection among possible choices that is based on reasoning and facts. In a rational decision making process a business manager will often employ a series of analytical steps to review relevant facts observation and possible outcomes before choosing a particular course of action. Rational decision making can also be termed classical decision making.
Rational decision making is part of the normative or prescriptive decision theories where there is a preset way of making decisions, i.e. norms, standards, and policies already in place are used as a criterion or base line for making decisions.
Decision making models and approaches have revolved over time, researchers have identified the following key models and approaches:
- Rational Decision Making Model (classical Decision Making Theory) - Rational Decision Making is elaborated upon in the following section.
- Bounded Rationality Decision Making Models
Bounded Rationality Decision Making Models is a model that was developed by Herbert Simon. He brings forth an argument that says decision making can never be perfectly rational processes, but rather one that is has within it a number of constraints and limitations. These include information constraints i.e. it is likely that information gathered may not be sufficient to develop all possible alternatives. The second limitation is people’s ability to fully comprehend the complexity of the problem at hand. Thirdly when making a decision is being made time constraints are automatically imposed.
In view of these constraints it can than be said that cannot be based on perfect knowledge and analysis, but rather on the results of modified process known as satisficing.
“Satisficing” is a word that combines satisfying and sacrificing, it is a concept that says given these limitations one cannot choose the most satisfactory alternative but sacrifices have to be made. Therefore the solution selected will be acceptable solution, but not necessarily the best solution.
- Garbage Can Approach
“This approach works on the principle of chaos”
In this approach decision making is viewed as being haphazard and unpredictable. The term Garbage Can indicates something that contains problems, solutions, participants, and opportunities that float round. Once all these factors have been united a decision can be made. Timing in this approach is crucial since one can say that the right participant must find the right solution to the right problem at the right time.
- Political Approach
This approach suggests that the primary motivation of decision makers is to advance personal preferences, based on organisational goals. In each step the decision maker is perceived as using the opportunity to influence the final decision and hence promote their own personal preferences.
In his article, The Ethics of Decision Making; Kenneth E Boulding states that, “The ethical...