介绍决策作为定量方法的上下文

1Topic1-IntroductiontodecisionmakingasthecontextforquantitativemethodsLearningobjectivesAftercompletingthistopicyouwillbeableto:Understandtheimportanceofdecisionmaking.Knowthatdecisionmakingisaprocesswhichmayinvolvesolvingproblems.Appreciatetheimportanceofinformationtodecisionmaking.Appreciatethatquantitativemethodsmayaideindecisionmaking.Beabletoidentifyanddescribethestepsinvolvedindecisionmaking.2IntroductionThistopicintroducesthesubjectofquantitativemethodsasanimportantpartofthedecisionmakingprocessofexecutivesandmanagers.Theprocessofdecisionmakingispresentedtoprovidethecontextforquantitativemethodsinthefunctionsrequiredforrationaldecisionmaking.Thepurposeofthisbookisthenoutlined,inwhichthedistinctionbetweendecisionmakingandproblemsolvingismade.TheprocessofdecisionmakingMakingdecisionsisaprocess.AccordingtoHebertSimon(1960,p.1):“decisionmakingcomprisesthreeprincipalphases:findingoccasionsformakingadecision;findingpossiblecoursesofaction;andchoosingamongcoursesofaction”.Whentherearepossiblecoursesofactions(options)available,decisionsneedtobemade,eveniftheresultofmakingadecisionistocontinuewiththestatusquo.Mostdefinitionsofdecisionmakingconferthattheprocessinvolvestheperson/peoplemakingadecisionhavingseveralalternativestochoosefromandthatmakingachoiceinvolvesevaluatingthepotentialoutcomes.Theabilitytomaketherightdecisionsinatimelyfashionisthearguablymostdefiningcharacteristicofaneffectivemanagerandexecutive.Cornell(1980,p.13)arguesthat:“theactofmakingadecisioniswithoutequalimportance–thatistosaytheactofmakingtherightdecisionabouttherightproblemoropportunity”.Hecontinuestosaythatthisassertionisnottodowngradethemanyotherfunctionsthatamanagerhastoperformorskillsthathe/shemusthave,butratherthatdecisionmakingisimportantbecauseitisattheheartofallinterrelationshipsbetweenpeople,processesandproduction.Formanagersorexecutivestobeabletomake“therightdecisionabouttherightproblemoropportunity”(Cornell1980,p.13)theymustfirstbeabletoidentifytheexistenceofaproblemoranopportunity.Thisabilityisbasedontheknowledge,understandingandforesightofwheretheorganisationcurrentlyisandwheretheorganisationshouldbeheadingstrategically.Therefore,aproblemexistswhenthecurrentstateisundesirableandanalternativestateispreferred.Thisisthecaseevenifthedesiredstatecannotbediscerned(Bass1983).Theproblemmayrequireoneormoredecisionstosolve.Importantly,fordecisionstobemadetheremustbechoiceofpossiblesolutions,becausewithalackofchoicethereisnoneedfordecisions.3Whereasproblemsolvinginvolvesidentifyingthesolutions,decisionmakinginvolvesimplementingthechosensolution.Thereforeproblemsolvingisessentiallyabstractwhiledecisionmakingrequiresactionandcommitmenttochange.Althoughwemayliketothinkthatmanagersandexecutiveswillmaketherightdecisions,thisisnotalwaysthecase.Whatweneedtoconsiderhereiswhatistherightdecision.Isitsimplythebestchoicegivenasetofalternatives?Suchaviewignoresthefactthatchoiceshaveconsequences(outcomes)andthatthesecanbebothgoodandbad.Furthermorethisquestionassumesthatonecandeterminethebestchoicefromarangeofalternatives,whichisrarelythecase.MarchandSimon(1958,p.114)developedatypologythatdifferentiatesalternativesbasedonexpectedoutcomes.ThetypologycontainsthefirstfourcategoriesasshowninTable1.1andDrucker(1973)offersthefifthcategory.Table1.1AtypologyofdecisionalternativesbasedonoutcomesAlternativesExpectedoutcomeGoodalternativeLikelytoresultinapositivevaluedstate.BlandalternativeUnlikelytoproduceeitherapositiveoranegativevaluedstate.MixedalternativeIslikelytoresultinbothapositiveoranegativevaluedstatePooralternativeIslikelytoresultinanegativevaluedstateDonothingNochangeinstateObviouslythedecisionmakershouldnotselectpooralternativeswherethenegativevaluedstateisworsethannotchangingthestate.However,knowingtheactualoutcomeismostoftennotpossiblebeforecommitmenttoaction.Insuchcasestheoutcomesareestimatedbasedontheamountandtheuseofavailableinformationtopredictoutcomes.Basedontheanalysisofavailableinformation,thedecisionmakerhasthreepossiblestatestoworkwith.ThesearesummarisedinTable1.24Table1.2SummaryofstatesrelatedtodecisionmakingStateOutcomesCertaintyCompleteandaccurateknowledgeoftheconsequencesofeachalternative.UncertaintyCannotdefinetheconsequencesofeachalternative.RiskAssumptionthataccurateknowledgeexistsandthatprobabilitiesofoutcomescanbeassignedtoeachalternative.Asmentioned,thestateofcertaintyisveryuncommonasitassumesthatthedecisionmakerisfullyawareofallthepossibleoutcomes.Fordecisionmakerstobefullyawaretheymusthaveperfectinformation,whichincludesallpossibleinfluencesandconditionsonthesituationssurroundingthedecision.Similarlyitisalsouncommonforgenuineuncertaintytoexist.Thereforewithsomeinformationregardingthedecisioncontextandanalysisoftheinformationdecisionmakerscanassumethattheyaresomewhereinthestateofselectingalternativeswithsomeestimate(calculated)risks.Toestablishariskstateratherthananuncertaintystate,thedecisionmakermustadoptseveralfunctionsaspartofthedecisionmakingprocess.Thesefunctionsinclude:establishingobjectives;searchingforinformat