The Rational Model Of Organizational Decision Making

2332 Words Mar 9th, 2016 10 Pages
CHAPTER TWO
PROJECT EXECUTION AND EXPERIENCE

2.1 Schedule of Activities of Students for the Project Work
2.2 Explanation of Theories Used
Organizational decision making is defined as the process of responding to a problem by searching for and selecting a solution or course of action that will create value for organizational stakeholders.
Decision making is a critical responsibility in leadership and the ability to make the right decisions is imperative to the success of every organization. Over the years, various models and theories have been developed to explain how organizations make decisions. This paper shall consider a few of the models and explain how these models and theories apply in the context of the topic of this research.
I. The Rational Model of Organizational Decision Making
This model is based on the logic of optimal choice: the choice that would maximize value for the organization. The manager is assumed to be an objective, totally informed person who would select the most efficient alternative, maximizing whatever amount and type of output s/he values. We can summarize the rational choice process as follows:
1. An individual is confronted with a number of known alternative courses of action.
2. Each alternative bears a set of possible consequences. These consequences are known and are quantifiable.
3. The individual has a system of preferences or utilities that permits him or her to rank the consequences and choose an alternative.
There is…
Open Document