(04) Organizational Decision Making, Power, and Politics Flashcards
In the article the writers talk about the perspective of organizational
decision-making theory. Explain this perspective.
Decisions of all types and magnitudes shape and form organizations, and in this sense, you can look at an organization as a locus for decision-making activity.
Herbert Simon identified and questioned the assumptions of the rational decision-making model. What were his points of critique?
- He pointed out that the rational model assumes that decision makers have knowledge of their alternatives and of the consequences of implementing those alternatives, but that real decision makers often possess incomplete and imperfect information about alternatives and consequences.
- Second, he suggested that the rational model ignores the internal politics of the organizational system. It assumes that there is a consistent preference ordering among decision makers (i.e., that everyone-agrees about the goals of the organization), and that decision rules are known and accepted by everyone concerned.
Real organizational decision makers often confront conflicting goals. Simon proposed that
attempts to be rational in organizations are limited by:
(1) imperfect and incomplete information;
(2) the complexity of problems;
(3) human information-processing capacity;
(4) the time available for decision-making processes;
(5) the conflicting preferences decision makers have for organizational goals.
Two implications of bounded rationality are particularly important from an
organization theory perspective. State these two implications and explain them.
- The first is that, in some situations, decision makers will have too little information to meet the demands of the rational model. (uncertainty) (lowered when new information is presented)
- The second implication of bounded rationality derives from an understanding of conflicting goals. (ambiguity) (gets higher when new information is presented)
Disagreement, as Simon points out, has several faces. The two that
decision-making theorists have focused the most attention on are:
(1) disagreements about goals to pursue or problems to solve (what direction to take)(ambiguity), and
(2) disagreements about what knowledge to bring to bear on the decision making process, in other words, about how the goals should be achieved (uncertainty, too little information)
In the article you can find a
“MATRIX SHOWING CONDITIONS FAVORING DIFFERENT DECISION MAKING PROCESSES”
State the dimensions of the matrix first, and then the four decisions making methods and when they should be used.
Dimensions:
- “Agree (A)/ disagree (DA) on methods” (Y-axis)
- “Agreement/disagreement on goals or problem definition” (X-axis)
Decisions making processes:
(1) Rational model (methods; A| goals/problem; A)
(2) Coalition method (methods; A| goals/problem; DA)
(3) Trail-and-error model (methods; DA| goals/problem; A)
(4) Garbage can model (methods; DA| goals/problem; DA)
Explain the trial and error decision making model.
Under these conditions, uncertainty (lack of information) is high, but ambiguity (multiple interpretations of what you are trying to accomplish) is not a critical factor. Here the decision-making process will most likely
take the form of trial-and-error learning.
Where decisions are of significant magnitude, it is common to find decision
makers in this set of conditions moving cautiously, engaging in a succession of
limited small decisions that can be fit together over time into a full solution or
plan of action. 6
The Coalitional Model
Organizational decision-making processes are sometimes shaped by a lack of agreement about the goals to be pursued or the issues to be addressed. This situation is the natural result of organizational realities such as multiple, conflicting goals, competition over scarce resources, interdependence, and other sources of conflict and contradiction (we will examine these in Chapter 10). Under these conditions, those with the most powerful positions tend to dominate the decision-making process. However, when decision makers are aware of this tendency, they can act to manage or manipulate the decision-making process by engaging in politics.
In cases that fit the conditions of the coalitional model of decision making, ambiguity is far more problematic than uncertainty. Under these conditions, decision makers do not focus primarily on a search for problem-solving information, but rather emphasize interest -accommodating alternatives.
The garbage Can Model
When agreement about goals (or issues) and the means to achieving them is absent, decision makers confront both uncertainty and ambiguity. Under these conditions the garbage can model seems to best describe the organizational decision-making process as it occurs in organizations.
In the garbage can model, problems, solutions, participants, and choice opportunities
are independent streams of events that flow into and through organizations, much like a random selection of waste gets mixed together in a garbage can.
The garbage can model contrasts sharply with the assumptions of the rational
model of decision making.
It proposes that decision making presents an arena within which organizational members act out their conflicts and differences. This view downplays the instrumentality of decision
making and presents it instead as an organizational drama within which decisions are social constructions of reality.
The rational model
The rational model, you will recall from Chapter 4, begins with the definition of a problem and the collection and analysis of relevant information that serves as a frame for the decision-making activity (1) . The next step is to generate and evaluate as many alternatives as possible (2), considering the likelihood of both positive and negative consequences for each option. This is followed by selection from among the alternatives (3) on the basis of criteria that have been worked out in advance and are related to the objectives of the firm. Finally, the selected alternative is implemented (4).
(1) Define the problem
(2) Generate and evaluate alternatives
(3) Select an alternative
(4) Implement the selected alternative
(5) Monitor results
Following up on his analysis of action versus decisional rationality, Brunsson makes several counter proposals to the rational model. He proposes, that, in making a decision, organizational decision makers should:
(1) analyze few alternatives, and of these it is best if only one has a good chance of being accepted (proposing unacceptable alternatives reinforces the decision to accept the preferred alternative with positive consequences for
expectations of success, motivation, and commitment);
(2) consider only the positive consequences of the favored alternative (this reduces doubt, bolsters expectations of success, and creates enthusiasm and commitment to the alternative);
(3) avoid formulating objectives in advance; instead reformulate the predicted consequences of the favored alternative as your decision-making criteria (this supports motivation and commitment to the selected alternative).
Brunsson does not completely abandon decisional rationality, but he restricts rational decision making to situations where:
“where the benefits to be gained from motivation and commitment are slight-for instance when the actions concerned are less significant, less complicated, and geared to the short term.”
In other words, Brunsson sees rational decision making as appropriate for small and insignificant, rather than large or important, decisions.
