Decision process models
Decision process consist identify and define the essence of the decision situation, identification of alternative possibilities, the choice of the best of them and putting it into effect.
There are two basic models: classic and managerial decision-making process.
It is based on the belief in the possibility of optimizing the decision. It is believed that rational and systematic actions helps to find relevant solutions to the problems. Managers should try to get full information about the situation and create proper conditions to eliminate uncertainty.
In this model, managers should:
- gain complete and accurate information
- eliminate uncertainty,
- assess everything rationally and logically,
- make optimal decision
Classic decision-making model involves several basic steps of actions carried out in the correct order. The conditions assumed in the classic model, are in fact rare. In the activities of the managers there are mistakes, and information are usually incomplete. Managers do not always behave rationally and logically.
It is also known as behavioural or administrative model. It assumes that decision makers are characterized by limited rationality. This is the tendency to strive not only to optimize decision, but rather to gain satisfaction. This means that managers are limited by their values, skills, and unconscious reflexes. There are also limited by incomplete information and knowledge. You can say that although they are seeking for rationality, their rationality has distinct limits. On the other hand, it can be noted that taking decisions tend to self gratification, to choose the first option that meets a minimum standard of the expected sufficiency.
In this model, managers:
- use an incomplete and imperfect information
- are restricted in their rationality,
- tend settle for a first acceptable solution,
- take a decision which could serve the interest of the organization or not.
- Ramser, P. (1993). Review of Decision Making in Action: Models and Methods. American Psychological Association.