Toshiba Rational Choice Model

The decision making process includes cognitive processes that eventually lead to a choice in action while taking into consideration the alternative possibilities (Allen, Dorozenko, & Roberts, 2016). Not all choices have to lead to an action. The values and preferences of the person making the choice also comes into play when making the final decision. Problem-solving to obtain a certain goal or satisfactory by a solution is the main reason people go through the decision making process (Stefaniak, & Tracey, 2014). This process has many factors that end with one final result or solution. The decisions made can be rational or irrational and can be determined by explicit or tacit knowledge (Qingyao, Dongyu, & Weihua, 2016). Since the decision making process can be very difficult at time, psychologists have viewed the process in different perspectives to get a better understanding (Rossi, Picchi, Di Stefano, Marongiu, & Scarsini, 2015). The different perspectives include; psychological, cognitive, and normative or communicative rationality.

A rational decision implies that a qualitative and considered thought process was undertaken in order to reach an optimal outcome. Although there are defined rules that add structure to the rational decision making process (Tripathi & PNP 2007; Williams, & McWilliams 2013), according to contingency theory and with respect to the rationality paradigm, there are limits to which an optimal outcome is realised (Morgan 1986, p. 167; Schoonhoven 1981, p. 352). External factors such as government, customers, competitors and suppliers all impose their constraints that influence the final decision. Contingency theory suggests that the final decision is ultimately determined by the organisation’s overall objectives coupled with real world limitations, and consequently all rational decisions take the form of bounded rationality and therefore should be considered suboptimal (Todd & Gigerenzer 2003, p. 144; March & Simon 1958, p. 269). However, there is another view that considers rational decisions made independently and unbounded will become optimal, or more accurately stated, maximising the expected utility (Von Neumann & Morgenstern 1944).

Rational decision is a state of being agreeable to reasons. The correct decision is not just reasoned but it is also optimal for solving a problem. Mr Weekes, the operation manager, employed series of analytical steps to review possible outcomes for problems by discussing it with managers to come up withdevise particular courses of action.

Rational decision making Rational decision making provides a structured and sequenced approach to decision making (Bazerman and Moore, 2013). Using such an approach can help to ensure discipline and consistency is built into decision making process. As the word rational suggests, this approach brings logic and order to decision making, comprising a set of steps which include generating multiple options as part of the process (Fig 2). It is thought to be the ideal way to make the correct decision, however this is difficult to achieve in real

The rational choice theory states that people make decisions in a rational but also in a self- interested manner (Class Notes 4/4/2017). Bounded rationality is the theory that when individuals make decisions, their rationality is limited by the information they have as well as the time available to make the decision. The time constraints and lack of full information are what differentiates bounded rationality and the rational choice theory. However, the garbage can model is said to represent most real life organizational decisions as they are random and unsystematic (Class Notes 4/4/2017). This model of organizational decision making is a collection of problems and solutions. The problems look

The concept of ‘rationality’ has been talked through the centuries. According to Grey (2013), rationality is a big question because of this proposition which has the meaning and difficulties seem to be defining of a whole set of issues which have resonated through both organisation theory and practice ever since. And rationality is the basis of a decision, rational decision makers are objective and logical, they reach the goal that maximises the value. Not only rationality is important to organisations, and also it can be identified in various kinds of management theories. This essay will introduce the different aspects of the concept of ‘rationality’ and make explanations that how these are recognised in different management theories.

In 2015, The Japanese company owned Toshiba Corporation’s scandal lead to the CEO, Hisao Tanaka’s resignation after an independent financial audit revealed accounting discrepancies totaling 58.9 million dollars. Well known for various home electronics (TV, VCRs, etc.) and household appliances (dishwasher, washing machines, etc.) the Toshiba Corporation has been operating since 1875. An analysis of what happened to Toshiba demonstrate a lack of ethical standards in leadership, transparency, and finance.

Decision making is the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs. The ultimate principle of the rational choice paradigm is to choose the alternative with the highest subjective expected utility. And we can use the rational choice decision making process that there’s six

Many methods have been developed to simplify the decision making process. In this paper, the rational model of decision making will be discussed first. Then, some of the factors that cause deviation in the rational

Rational decision making reduces a risk as compared to gut feeling. Because we think rationally and after that we make a sound decision that helps any organization to achieve desired objectives and goals.

Rational decision-making process and the bounded rationality theories can easily be compared and contrast. They both are applying to the decision-making process and have the same purpose: giving a framework to solve a problem. However, these two models have many differences.

The textbook states that the “rational choice paradigm selects the choice with the highest utility through the calculation of subjective expected utility” (McShane, S., Steen, S. & Tasa, K. (2015) In other words it is the probability of utility every time there is an alternative. First, the problem must be identified before choosing the right method to execute the problem. From that point, you develop and evaluate solutions choosing the right way to solve the problem. The decision of replacing Kurt Devine’s position as a chief operating officer (COO) in with Tom O’Grady; they did not really involve in being a part of the rational decision-making process. There is no rational decision to why Rohretech’s Board of Directors made a choice of taking Kevin Devine’s out of his spot. In the beginning Trivac Industries was on the verge of running out of business so they tried to be as independent. “When investments fail to meet initial expectations, decision makers face a liquidation dilemma: they may favor continuing to finance the project to retain the option of improvement or they may decide to terminate” (Devigne, D., Manigart, S (2016). They told Kurt Devine that he needed to have better incorporation with Trivac and

A combination of pressure CEO and culture Toshiba that cannot be emend error management judge, make Toshiba lose their confidence. Because Toshiba have done betrayal confidence to everyone .The problem, a company that there has been one since 140 years ago has been do overstated on their financial report. Scandal that owned by Toshiba is not small cases .Toshiba have done overstated very large namely 151,8 billion YUAN or 1.2 billion USD .This scandal not done a little while, Toshiba out of it began from 2008 April and new revealed in 2015 which is about 8 years Toshiba have out of this. Deviation this revealed by independent investigation committee led by Koichi Ueda. Scandal that do by Toshiba not only involving managers Toshiba but also

Effective decision-making is very important on how probability can be applied therefore effective decision-making must be rational. As mentioned before, people who are deciding rationally are attempting to reach goals in a systematic way. They make sure

Sometimes I tend to make decisions in a hurry when I am left with no time to think. At these situations, I take decisions either based on limited information that is available to me or listening to my friends. For instance, I choose to buy a blazer listening to my friends who walked into the store along with me. When salesperson offered me a better bargain, I still turned it down. This kind of decision making comes under one of the descriptive decision making i.e.., “Bounded rationality”.