6 Stages of Rational Choice Decision Process
1. Identify the Problem or Opportunity. Defining the problem correctly is critical to arriving at an appropriate solution.
2. Choose the best decision process. Different problems require different approaches for arriving at a solution. In some cases, brainstorming is an appropriate process, for example, but not in all situations.
3. Develop alternative solutions. By putting various solutions "under consideration," more creative and appropriate solutions can be implemented.
4. Choose the best alternative. Select from the alternatives, or a combination of the alternatives using the criteria defined earlier.
5. Implement the selected alternative. This may include training staff on the solution, purchasing new equipment, or implementing new procedures.
6. Evaluate decision outcomes. The decision should be evaluated and modified as necessary to ensure that the desired outcomes are achieved.
Three Ways Emotions Influence the Selection of Alternatives
1. Emotional "markers" influence preferences before individuals are confronted with actual choices.
2. Moods and emotions can affect the decision process-people in good moods may be more "open" to various alternatives than people in bad moods.
3. During the decision making process itself, we "listen in" to our emotions and can be influenced by them. If an alternative is associated with negative emotions, that can "spill over" into the decision making process.
Four Causes of Escalation of Commitment
1. Self-justification. Decision makers continue to approve resources to projects in order to justify their original decision. This can occur regardless of the current evaluation of the project.
2. Prospect theory effect. Despite the poor performance of a project at a particular point, decision makers may believe that...