Decision Making

Introduction

As most observers have made conclusions, the most common difficulty in organizational decision making comes from the fact that the organization is not an individual, but a collection of individuals. In the standard theory of choice, the conflict of objectives is a serious problem in assessing tradeoffs. In classical theories of decision making, the organization is transformed into an individual, similar to how the market converts conflicting demands into prices. According to this view, decision makers are expected to impose their objectives on an organization in exchange for satisfactory wages for workers, the rent of capital and the final product that reaches the customers.

The decision-making process can be divided into two levels. On the first level, every person negotiates the optimal terms for reaching an agreement. On this  level, contracts must be well designed as they will appear and have to be executed on the second level.  . In the case when participants have conflicting objectives, we can speak about decision making marked by political ideas.

Such features of organizational decision making can be a result of modification of classical theories of decision making when decisions are treated as a product of an unresolved conflict. It is more difficult to agree on the fact that this description is closer to actual situations, than to approve a single function.  The behavioral study of decision making under conflict is more complicated since there is a tendency for  political perspectives of decision making to be perpetual.

Types of Conflict

There are three basic forms of motivational conflicts, namely approach-approach conflict, the avoidance-avoidance conflict and approach-avoidance conflict.

The first form, approach-approach conflict, comes from competing and attractive options that are positive and hence desirable alternatives. The avoidance-avoidance conflicts are produced by the decision between the options which are repulsive, but competing. The approach-avoidance conflicts are characterized by concurrent repulsion and attraction of options.  In this case, alternatives have both negative and positive valences. In approach-avoidance conflicts,  the magnitude of avoidance tends to be compared to that of approach (Hill, 1986).

Conflict Decision Making at the Top Management

When top managers resolve a conflict constructively, they serve as an optimal example for their juniors. By doing so, they are able to manage their strategic decision making. The study carried out by Stanford professor Eisenhardt was conducted among top managers of high-tech companies. The results  showed that, where there was a productive team, the conflicts in decision making were manageable and did not engage personal conflicts.

The top managers of less productive organizations were found to have a lot of difficulties connected with personal conflict.  The difference that was discovered between the two teams of decision makers was that the best teams resolved conflicts working together on the problem and generating multiple probable solutions. The best management controlled their team’s discussion without imposing their ideas on their organization or abdicating the leadership. In the case of conflict decision making, to come up with the final and optimal decision,  it is always necessary to apply the philosophy of consensus effectively. Most importantly, decision makers should attempt to reach a consensus and collaborative decision.

The most frequent indicators of conflicts in the decision-making process, either at individual or organizational level, are hesitation, uncertainty, vacillation, and emotional stress. These feelings will be experienced whenever decisions are to be made. The conflict in decision making aggravates whenever a decision maker becomes aware of the possible risk arising from his/ her course of action.

Need for Cognition

The perception of the need for cognition in conflict decision making is the tendency of a decision maker to engage in critical thinking and enjoy it.  It is the individual differences that control the willingness to participate in an effortful cognitive process. People with low need for cognition tend to avoid critical thinking, while those with high need of cognition tend to engage willingly in such effortful information seeking process (Wilson, 1980).