Decision Making Theory & Process

In the early1970s, scientific approaches to decisionmaking were introduced, as tools with which organizational leaders could (1) minimize the effects of risk and uncer tainty in the development and implementation of strategy, and (2) optimize outcomes in the conduct of operations.1 While not yet commonplace as some other managerial tools, the various manifestations of scientific decisionmaking are well established.2

Decisionmaking in organizations has been described as a process of behavior with the economic model (or total ration ality) at one extreme, and with the social model (or complete irrationality) at the other extreme. This description implies

1R. S. Clark, "The Strategic Planner's Toolbox," CA Magazine, 120, July 1987, 28.

that only irrational decisionmaking accords human values precedence over economic values.3 In the organizational environments of the early1990s, leaders must find some middle ground between these extremes, for it is evident that neither set of values can be ignored. In many organizations, administrators and managers have been confronted with the tasks of making severe, undesirable, and unpleasant cuts of personnel and services in a hasty manner, because, in part, the

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_____ 10D. J. White, "Real Applications of Markov Decision Processes," Interfaces, 15 (NovemberDecember 1985): 7383. 7 The Delphi Technique A second important decisionmaking approach is the Delphi Technique, which focuses on the reaching of a consensus in terms of goals, priorities, and objectives. The Delphi Technique requires extensive use of feedback. Thus, the use of the computer facilitates the decisionmaking process. Project Control DecisionMaking In the mid1950s, the concept of a construction project as a network of interrelated and coordinated activities began to emerge. The four specific characteristics which a construction project must possess to effectively employ the network concept in scheduling and control are (1) a clearly recognizable endpoint or a clearly recognizable objective, (2) a series of events, (3) a specific time for each event, and (4) a specific starting point. In the context of a clearly recognizable end point or objective, the network concept has greater applicability in construction management than it does in manufacturing management. Although the events in a series must be interrelated, they must also be separate and clearly definable. If events cannot be effectively
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Approximate Word count = 3509
Approximate Pages = 14 (250 words per page)

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