decision making in organization essay

Decision Making Essay

Introduction.

Decision-making is undoubtedly a fundamental practice the management of corporations. It denotes the progression of choosing and executing options, which are in tandem with an aspiration. It also connotes a string of actions commencing with a broad objective, trickling down to generating, appraising, choosing and executing favourable options.

Decisions made in organizations may have in-depth upshots on the firm and its employees. Such judgements in organizations are distinctive in terms of the risks involved, reservations managers have on them, their importance and contribution to the attainment of the firm’s broader objectives.

Some are tricky and requires insight thought, and may include setting of new policies, reorienting firm’s purposes and objectives, and large-scale ventures with a potential to impact on the economy of the firm. On the other hand, routine decisions also form part of a firm (Martin & Fellenz 2010, p. 227).

Rational model is a conventional representation of making decisions, and it leans on realistic financial hypothesis where the concerned members think of what constitutes best way of arriving at a judgement. Managements regularly use this model to make fiscally sensible decisions, which are capable of contributing to organization’s financial growth.

The model helps delineate how managers should make decisions. In addition, it presents guidelines, which enable decision maker to reach a favourable panacea for organizational development. The mould also negates the decision makers from applying their personal interests while searching for favourable outcomes.

It is highly applicable on decisions characterised by assurances and possibilities since suitable information is accessible. Furthermore, the model exposes opportunities to computations. For instance, usage of Information Technology to automate programmed decisions such as airline companies apply it is seat bookings, flight routes, and services pricing.

It is worth noting that decision-making techniques relying on quantitative information benefit processed in computers enable the model to gain usage. The model; however, has assumptions including decision makers’ ability to fulfil goals already agreed on and setbacks critically prepared and definite.

The decision makers also aim to attain certainty and collect relevant data, options and prospective outcomes computed. Procedure for evaluating options is clear and those able to optimize fiscal returns chosen. Finally, it assumes that the decision maker is logical and can use judgment to choose options, which will optimize economic gains.

The model describes the six stages of decision making as identifying a dilemma or opportunity. Daft and Marcic note that organizations face problems when they underperform and opportunities when administrators realize potentials of improving performance past existing echelon. This becomes the initial step in decision-making and warrants company’s inner and external forces surveillance (Daft & Marcic 2010, p. 188).

The managers utilize internal fiscal reports to forecast on possible threats and openings. Information gathering is another crucial stage that follows. This normally guarantees the manager an opportunity to analyze the possible causes of problems identified. This is tenable when decision makers, through creativity, develop questions reading the problem and opportunity state (Griffin, & Moorhead 2010, p. 198)

. The third stage is to develop alternatives, which seeks to generate potential optional answers to react to the requirements of the condition and give feedback on the basic reasons. It is easy to discover realistic options within the firm’s regulations since the decision-making is based on certainties and threats.

The identified options are deemed to ease the disparities regarding current state of affairs against conditions considered necessary.

Selection of desired options becomes the fourth step, which seeks to select among the options, the most realistic alternative that can best respond to the firms broad objectives. It is imperative to assert that the best attainable option must be requiring minimal resources to attain the needed outcomes. Furthermore, decision maker selects an option with the lowest quantity of uncertainties and threats.

This would aid in avoiding errors in the process. The fifth step is implementing the selected option, which requires corporation from the organization’s stakeholders. The managers, administrators and other staff work together to implement the option.

The ultimate step is to evaluate and present feedback on the status of implementation. Decision makers collect data on the effectiveness of the option in responding to the objectives. This final step is important since decision-making is an uninterrupted cycle. Therefore, the provision of feedback forms the benchmark for future decision-making.

There are factors, which influence decision-making course thus leading to a deviation from the rational form discussed above. Individuality personality and values is one of the leading parameter that affects the process. Different attributes of people manipulate decision-making choices. It is normal to discover that various individuals become nervous, worried, and agitated while in the crucial stages of decision-making.

Such attributes normally leads to fallacious interpretation in the process. It is crucial to declare that being nervous compromises reasoning; therefore, a manager may fail to arrive at the best decision. The attitudinal traits also interfere with decision in an organization. Some managers have fixed thoughts concerning what happens at the organization.

They believe that specific employees or figures must be present whenever there is a crucial matter to make decision. This implies that they have preset minds that such individuals are the best decision makers. This normally prompts the organization to believe such people contribute, regardless of the impacts they present on the organization.

Various managers possess different personalities. Some possess elevated self-esteem, which is motivational in during decision-making. Managers with strong personalities normally dominate the discussion during the process. This may flaw the process since their juniors may fear to contribute. This offers fewer options on the best way of solving organizational problems. This is incoherent with the rational model.

Preconceived fears about the consequences of the decisions would have on the organization normally send chills in the managers, and other concerned parties. This refers to emotional attributes of an individual. Griffin and Moorhead outline that perceived impacts, as well as post resolution effects may impair decision-making.

Furthermore, cognitive ideals such as outright biases have an effect on decision-making (Griffin, & Moorhead 2010, p. 202). Values that an individual embrace also influence decision making, and many counter the rational model. It is factual that managers espouse divergent principles and would attempt to maintain them in every situation. People would always propose what they like regardless of what impact it has on others.

Group relationship is another important parameter that influences decision making to a greater deal. The success of making decisions in groups is subject to the extent of understanding among members forming the team. Martin and Fellenz, posit that the group must have the right intensity of diversity thus enabling them to iron their differences.

Group decision making is highly applicable in organizations where it intricate issues, which can only be managed by a team with varied knowledge backgrounds (Martin & Fellenz 2010, p. 284). Group polarization connotes the way people react to situations of decision-making. People normally arrive at decision-making meetings with different views; however, they tone down to borrow the ideas of their fellows.

Therefore, a group that comprises of people with deep understanding of the dynamics that exists normally makes rational decision. Nonetheless, some groups might not arrive at a decision easily owing to the divergent notions members possess. This may be due to the everlasting differences that exist amongst members.

The level and kind of relationship within a group normally dictates how people make decisions. Superior relationship may prompt others to seek support from their fellows; however, this may flaw the process thus leading to irrationality. Group decision-making in organizations enable extra people to sustain influential contributions during the process than they would achieve individually.

Another issue is group thinking, which happens a when a decision making team is greatly involved in a discussion and the motivation to evaluate options is cancel out by their unanimity. This fails to support the rational model of decision-making since it thwarts other possible options that are crucial in the process.

Rational model upholds that divergent group may arrive at better conclusion than a group that has similar interest. Therefore, a divergent group, where people have good relation, but varied interest, would offer beat avenue of exploring many options.

The peak management makes tactical decisions within the organization. Varied aspects of power and its availability in any firm, coupled with inter personality conditions give rise to the relationships (Venkatachalam & Sellappan 2011, p. 97). Managers can influence decision making as they comment on what qualifies for discussions.

Power relations contribute to decision making through the engagement of organization staff on involvement in undertaking activities. Managers merely comply with the already set standards while leading other people. Whenever this takes place, the managers hold discussions with the relevant people to make decisions collectively on work aimed at meeting company goals (Venkatachalam & Sellappan 2011, p. 97).

Power leads to conflict in the organization, which needs adequate deliberation to decide on the best move. Different echelons of power requires transmitting information from pinnacle to bottom, which may cause damaged communication due to structural circumstances of those involved. Decisions making is necessary to solve the predicaments resulting from such conflicts.

Furthermore, power denotes leadership, which requires excellent qualities including superior decision-making ability. Managers must be able to identify threats and solutions to problems when options, facts, and goals are unclear. Managers ought to encourage shared decision-making. This is a way of empowering subordinates to be able to take part in an advice-giving decision making processes.

Power ought to organize the team members involved in decisions making. However, managers sometimes misuse their powers while engaging employees on making decisions about certain issues.

Decision choice less is the situation of managers seeking the opinion of the junior employees on vital organizational development agendas. The employees provide their information, which the manager discards and cannot include as one of the options for improving conditions in the organization (Shapira 2002, p. 145)

Political behaviour refers to as actions displayed by people in organizations; moreover, it depicts the requirements in such organizations. Political issues among some decision makers are an important aspect of decision-making. The politics include how managers use power to influence decision-making or the behaviour of employees while agitating for better remunerations.

It concentrates on designing and utilizing power in firm to ensure people who lack power get it to organizational level. The impact of political behaviour on managers includes the possibility of drawing up new policies for an organization upon learning the prevailing political happenings (Robbins, Judge, Odendaal & Roodt 2009, p. 358).

The managers take advantage of political unrest in an organization to destroy critical documents, which might be relevant for decision-making. People view political behaviour as a way of democratic decision-making, communicating demands for performance.

However, political behaviour in firms also presents dark side including intentionally telling lies, and intimidation. Political behaviours within an organization may thus impair decision following the divides it creates. Every political move has adverse impact in the process thus thwarting the rational model.

In conclusion, decision-making refer to a progression of choosing and executing options that are consistent with one’s inspirations. Rational model has contributed immensely to the decision-making in various organizations since it tend to eliminate all external forces that may hinder the course.

It is notable that myriads of parameters may influence the process. Personage personality and values normally may affect decision within the organization. Some managers hold particular values that they may not sacrifice in the process of decision-making. Self-esteem and other emotional attributes also affect decision. Anger, aggression and being overjoyed may compromise reasoning since they interfere with the psychology.

Making decision under such pressures may hinder the process, but soberness may lead to appropriate decision-making. Group relationship is another parameter that hinders decision since it influences individual thinking. Power relationship in an organization influences decision, as employees view high cadre to dominate during the process. This would allow them to offer options and easily convince people to consider their ideas.

The politics within corporations normally hinders decision-making, as it may lead to intergroup formations with competing attitudes. Decision-making should thus occur in a rational setting, which allows for adequate and rational consideration of every option.

List of references

Daft, R. & Marcic, D. (2010) Understanding Management , 7 th Ed. Ohio, OH. Cengage Learning.

Griffin, R. & Moorhead, G. (2010) Organizational Behavior: Managing People and Organizations, 9 th Ed. Ohio OH. Cengage Learning.

Martin, J. & Fellenz, M. (2010) Organizational Behaviour & Management . Ohio, OH. Cengage Learning.

Robbins, P. Judge, T. Odendaal, A. & Roodt, G. (2009) Organizational Behaviour: Global and Southern African Perspectives , 2 nd Ed. Cape Town.Pearson South Africa.

Shapira, Z. (2002) Organizational Decision Making . New York, NY. Cambridge University Press.

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IvyPanda. (2019, May 7). Decision Making. https://ivypanda.com/essays/decision-making-essay/

"Decision Making." IvyPanda , 7 May 2019, ivypanda.com/essays/decision-making-essay/.

IvyPanda . (2019) 'Decision Making'. 7 May.

IvyPanda . 2019. "Decision Making." May 7, 2019. https://ivypanda.com/essays/decision-making-essay/.

1. IvyPanda . "Decision Making." May 7, 2019. https://ivypanda.com/essays/decision-making-essay/.

Bibliography

IvyPanda . "Decision Making." May 7, 2019. https://ivypanda.com/essays/decision-making-essay/.

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Decision Making Within an Organization

Decision making is described as the process of choosing which action to take when there are a number of alternatives to consider. Wise decisions should always be made so as to achieve best results from the decisions made (Van & Schein, 1979). However, it should be noted that an individual may find it easier than a group of people to make decisions. Members of a group should always consult with one another before making any final decision and in some cases this process may take longer than expected. Group decision making processes sometimes become difficult when some group members do not agree with others on what should be done. Even though there are some challenges that may be experienced in decision making, sound decision making is very important for individuals or groups in organizations (Sternberg, Forsythe & Hedlund, 2000).

Decision making process in an organization is usually affected by a number of factors but the most common factors that affect decision making in many organizations are politics and power. If an individual can tell another person or a group of people to perform a certain task and the task is performed as directed, then the individual is said to have powers (Luen, & Al-Hawamdeh, 2001). Members of most organizations do not have the same powers because the top management team members are considered more powerful than other members in the lower ranks. In a well managed organization all workers are expected to respect and take orders from their supervisors. In such a situation, the supervisor can control the behaviors of other workers and thus has more powers in the organization that also can be used in influencing the decision making process (Luen, & Al-Hawamdeh, 2001). For example, a supervisor who has a formal training in a certain field may greatly influence a decision making process within an organization because the junior staff members believe their senior has more knowledge of what is supposed to be done. This type of power is known as expert power that makes most people to follow decisions made by their supervisors who are experts in relevant fields (Taormina, 1997).

Rational persuasion power is another form of power exercised by leaders in organizations who want things to be done in certain ways. They have to explain why some actions should be performed and even go ahead to explain how certain outcomes can be achieved when the actions are performed (Taormina, 1997). When a leader can demonstrate adequately how actions should be performed by the subordinate members of staff, the leader is likely to be honored and thus build a personal power. A person who has built personal power and gained trust from other people can easily influence decision making process in a group because other group members can easily agree with what the person says especially after a relevant explanation of an action to be undertaken has been offered.

Rational persuasion power was being used by a supervisor in a certain non-governmental organization (NGO) that was involved in improving the living standards of people living in rural areas in our country. I was one of the staff members of the organization and I can recall how our supervisor was using rational persuasion power to influence the decision making processes within the organization. John was the supervisor of our group that was responsible for ensuring that the people in that particular rural area involved themselves in activities that could improve their lives both socially and economically. John had a bachelor’s degree in economics and a master’s degree in business management. He could explain economic scenarios more than any other person in the group and even though most of us in the group were experts in business, John was considered to have more knowledge of business more than us.

We started our project by educating the residents of the area on the need of starting micro businesses so as to improve their living standards. During the process of educating the residents, we realized that the residents were willing to start small business ventures but they had no funds for starting the businesses. In addition, they did not like to borrow loans from banks because they were claiming that the interest rates that banks charged were very high and in some cases when the businesses collapsed the banks were likely to auction their properties so as to recover the money that were borrowed. We could learn all these from the residents because after every teaching session, we were giving them chances to ask questions and even speak of the problems they were experiencing.

After two weeks the teaching stage was over, we converged to give reports before moving to the next stage. The stages were to be followed sequentially and every task was supposed to be completed within specified periods. This implied that if an extra stage was to be included, the project could take longer than expected and the allocated resources could not be adequate to complete the project. Therefore, it was necessary to have wide consultation before making any decision that could affect the duration of completing the project and the available resources for the project. After we presented our reports on the first stage of the project, John explained to us the importance of educating the residents how banks offer loans and charge interest rates. He also told us to encourage the residents to take loans and invest in viable businesses without much fear of risks because good business people must be ready to take risks but at the same time put in place proper risk management measures. John decided that we should not proceed to the next stage as earlier planned but we should embark on teaching the residents how to apply, acquire, and put loans in viable investments. From John’s explanations, we all accepted the decision by John and considered it worthwhile. The project proceeded well until completion even though the completion date was extended a little bit after John had negotiated with other stakeholders to extend the completion date. John used rational persuasion power to make the decisions. This case clearly shows that power can influence the decision making process in an organization.

Politics is also a major factor that influences decision making processes in most organizations. Politics in organizations simply mean that leaders in organizations use their powers to make decisions when there are more interests or opinions from other members of the organizations. Organizational politics also can be described as the management of influence by an individual or a group of individuals to make sure that certain things are done using the means that are not sanctioned by the organization. In addition, organizational politics can be described to mean a way of making appropriate decisions so as to ensure proper functioning of organizations after evaluating different self-interests of people within the organizations and coming up with collective interests (Van & Schein, 1979).

When members of an organization involve themselves in constructive organizational politics, the organization can easily achieve its objectives. Constructive politics mean that every individual is ready and willing to discuss issues with other members within the organization with open mind but not giving self-interest the first priority. This is the only way in which individuals can arrive at a collective interest. On the other hand, bad organizational politics can lead to making of wrong decisions in organizations (Van & Schein, 1979). When sound decisions are not made for management of an organization, it is obvious that the organization cannot achieve its objectives and instead more problems may be created in the organization. Politics and power are related and if a leader abuses power to influence the organizational politics, the decision making process can be negatively affected.

I was studying in a certain university where the chief executive officer was the vice chancellor. The position of a chancellor was a ceremonial one in the sense that the chancellor was out of the learning institution most of the time and most of the responsibilities were left to the vice chancellor. It was not that our chancellor was lazy or irresponsible but this was how universities were being managed in that country. Major decisions were being made by the university senate that included the vice chancellor. Some university senate members were not lecturers and they were not spending most of their times within the university. Therefore, before senate meetings took place E-mails were sent to all the senate members notifying them dates and agenda of meetings. In some cases the members were contacted using cell phones. After various decisions had been made, they were posted on the university website so as to be accessed by the students and the public. There were some links within the university website that could be could be accessed only by the university staff members and students using their respective passwords. This implied that there was the use of modern information technology to enhance communication within the university and hence facilitate decision making processes.

The vice chancellor at one point used wrong organizational politics to make a decision that was unsuccessful. The chancellor and a few members of the university management staff decided to shorten the semester without consulting the students and other university staff members. The students learned of the decision when it was posted on the university website. The students protested against the decision but the vice chancellor insisted that his decision was final. This led to a serious riot by the students which forced the university management to close up the university. The vice chancellor had given his self-interest the first priority and used bad politics to make the decision that was unsuccessful. The vice-chancellor’s decision was later reversed by the university senate before the students were recalled to the institution.

People usually make decisions on different issues depending on the information they have about the issues. Organizations should therefore make good use of modern information technologies to create channels of communication so as stakeholders can access relevant information before making sound decisions (Taormina, 1997). The riot could not have occurred in the university if there were good communication channels between the students and the university management. The cases described above clearly show that power and organizational politics are major factors that influence decision making in organizations.

Reference List

Luen, W. & Al-Hawamdeh, S. (2001). Knowledge management in the public sector: Principles and practices in police work. Journal of Information Science, 27(5):311–318.

Sternberg, L., Forsythe, B. & Hedlund, J. (2000). Practical Intelligence in Everyday Life . New York: Cambridge University Press.

Taormina, J. (1997). Organizational socialization: A multi-domain, continuous process model. International Journal of Selection and Assessment 5(1): 29–47.

Van, J. & Schein, E. (1979). Towards a theory of organizational socialization. Research in Organizational Behavior 1: 209–264.

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StudyCorgi. (2022, March 21). Decision Making Within an Organization. https://studycorgi.com/decision-making-within-an-organization/

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11.2 Understanding Decision Making

Learning objectives.

• Define decision making.
• Understand different types of decisions.

Decision making refers to making choices among alternative courses of action—which may also include inaction. While it can be argued that management is decision making, half of the decisions made by managers within organizations ultimately fail (Ireland & Miller, 2004; Nutt, 2002; Nutt, 1999). Therefore, increasing effectiveness in decision making is an important part of maximizing your effectiveness at work. This chapter will help you understand how to make decisions alone or in a group while avoiding common decision-making pitfalls.

Individuals throughout organizations use the information they gather to make a wide range of decisions. These decisions may affect the lives of others and change the course of an organization. For example, the decisions made by executives and consulting firms for Enron ultimately resulted in a $60 billion loss for investors, thousands of employees without jobs, and the loss of all employee retirement funds. But Sherron Watkins, a former Enron employee and now-famous whistleblower, uncovered the accounting problems and tried to enact change. Similarly, the decision made by firms to trade in mortgage-backed securities is having negative consequences for the entire economy in the United States. All parties involved in such outcomes made a decision, and everyone is now living with the consequences of those decisions.

Types of Decisions

Most discussions of decision making assume that only senior executives make decisions or that only senior executives’ decisions matter. This is a dangerous mistake.

Peter Drucker

Despite the far-reaching nature of the decisions in the previous example, not all decisions have major consequences or even require a lot of thought. For example, before you come to class, you make simple and habitual decisions such as what to wear, what to eat, and which route to take as you go to and from home and school. You probably do not spend much time on these mundane decisions. These types of straightforward decisions are termed programmed decisions , or decisions that occur frequently enough that we develop an automated response to them. The automated response we use to make these decisions is called the decision rule . For example, many restaurants face customer complaints as a routine part of doing business. Because complaints are a recurring problem, responding to them may become a programmed decision. The restaurant might enact a policy stating that every time they receive a valid customer complaint, the customer should receive a free dessert, which represents a decision rule.

Figure 11.3

In order to ensure consistency around the globe such as at this St. Petersburg, Russia, location, McDonald’s Corporation trains all restaurant managers at Hamburger University where they take the equivalent to 2 years of college courses and learn how to make decisions on the job. The curriculum is taught in 28 languages.

Wikimedia Commons – public domain.

On the other hand, unique and important decisions require conscious thinking, information gathering, and careful consideration of alternatives. These are called nonprogrammed decisions . For example, in 2005 McDonald’s Corporation became aware of the need to respond to growing customer concerns regarding the unhealthy aspects (high in fat and calories) of the food they sell. This is a nonprogrammed decision, because for several decades, customers of fast-food restaurants were more concerned with the taste and price of the food, rather than its healthiness. In response to this problem, McDonald’s decided to offer healthier alternatives such as the choice to substitute French fries in Happy Meals with apple slices and in 2007 they banned the use of trans fat at their restaurants.

A crisis situation also constitutes a nonprogrammed decision for companies. For example, the leadership of Nutrorim was facing a tough decision. They had recently introduced a new product, ChargeUp with Lipitrene, an improved version of their popular sports drink powder, ChargeUp. At some point, a phone call came from a state health department to inform them of 11 cases of gastrointestinal distress that might be related to their product, which led to a decision to recall ChargeUp. The decision was made without an investigation of the information. While this decision was conservative, it was made without a process that weighed the information. Two weeks later it became clear that the reported health problems were unrelated to Nutrorim’s product. In fact, all the cases were traced back to a contaminated health club juice bar. However, the damage to the brand and to the balance sheets was already done. This unfortunate decision caused Nutrorim to rethink the way decisions were made when under pressure. The company now gathers information to make informed choices even when time is of the essence (Garvin, 2006).

Decisions can be classified into three categories based on the level at which they occur. Strategic decisions set the course of an organization. Tactical decisions are decisions about how things will get done. Finally, operational decisions refer to decisions that employees make each day to make the organization run. For example, think about the restaurant that routinely offers a free dessert when a customer complaint is received. The owner of the restaurant made a strategic decision to have great customer service. The manager of the restaurant implemented the free dessert policy as a way to handle customer complaints, which is a tactical decision. Finally, the servers at the restaurant are making individual decisions each day by evaluating whether each customer complaint received is legitimate and warrants a free dessert.

Figure 11.4 Examples of Decisions Commonly Made Within Organizations

In this chapter we are going to discuss different decision-making models designed to understand and evaluate the effectiveness of nonprogrammed decisions. We will cover four decision-making approaches, starting with the rational decision-making model, moving to the bounded rationality decision-making model, the intuitive decision-making model, and ending with the creative decision-making model.

Making Rational Decisions

The rational decision-making model describes a series of steps that decision makers should consider if their goal is to maximize the quality of their outcomes. In other words, if you want to make sure that you make the best choice, going through the formal steps of the rational decision-making model may make sense.

Let’s imagine that your old, clunky car has broken down, and you have enough money saved for a substantial down payment on a new car. It will be the first major purchase of your life, and you want to make the right choice. The first step, therefore, has already been completed—we know that you want to buy a new car. Next, in step 2, you’ll need to decide which factors are important to you. How many passengers do you want to accommodate? How important is fuel economy to you? Is safety a major concern? You only have a certain amount of money saved, and you don’t want to take on too much debt, so price range is an important factor as well. If you know you want to have room for at least five adults, get at least 20 miles per gallon, drive a car with a strong safety rating, not spend more than $22,000 on the purchase, and like how it looks, you have identified the decision criteria . All the potential options for purchasing your car will be evaluated against these criteria. Before we can move too much further, you need to decide how important each factor is to your decision in step 3. If each is equally important, then there is no need to weigh them, but if you know that price and mpg are key factors, you might weigh them heavily and keep the other criteria with medium importance. Step 4 requires you to generate all alternatives about your options. Then, in step 5, you need to use this information to evaluate each alternative against the criteria you have established. You choose the best alternative (step 6), and then you would go out and buy your new car (step 7).

Of course, the outcome of this decision will influence the next decision made. That is where step 8 comes in. For example, if you purchase a car and have nothing but problems with it, you will be less likely to consider the same make and model when purchasing a car the next time.

Figure 11.5 Steps in the Rational Decision-Making Model

While decision makers can get off track during any of these steps, research shows that searching for alternatives in the fourth step can be the most challenging and often leads to failure. In fact, one researcher found that no alternative generation occurred in 85% of the decisions he studied (Nutt, 1994). Conversely, successful managers know what they want at the outset of the decision-making process, set objectives for others to respond to, carry out an unrestricted search for solutions, get key people to participate, and avoid using their power to push their perspective (Nutt, 1998).

The rational decision-making model has important lessons for decision makers. First, when making a decision, you may want to make sure that you establish your decision criteria before you search for alternatives. This would prevent you from liking one option too much and setting your criteria accordingly. For example, let’s say you started browsing cars online before you generated your decision criteria. You may come across a car that you feel reflects your sense of style and you develop an emotional bond with the car. Then, because of your love for the particular car, you may say to yourself that the fuel economy of the car and the innovative braking system are the most important criteria. After purchasing it, you may realize that the car is too small for your friends to ride in the back seat, which was something you should have thought about. Setting criteria before you search for alternatives may prevent you from making such mistakes. Another advantage of the rational model is that it urges decision makers to generate all alternatives instead of only a few. By generating a large number of alternatives that cover a wide range of possibilities, you are unlikely to make a more effective decision that does not require sacrificing one criterion for the sake of another.

Despite all its benefits, you may have noticed that this decision-making model involves a number of unrealistic assumptions as well. It assumes that people completely understand the decision to be made, that they know all their available choices, that they have no perceptual biases, and that they want to make optimal decisions. Nobel Prize winning economist Herbert Simon observed that while the rational decision-making model may be a helpful device in aiding decision makers when working through problems, it doesn’t represent how decisions are frequently made within organizations. In fact, Simon argued that it didn’t even come close.

Think about how you make important decisions in your life. It is likely that you rarely sit down and complete all 8 of the steps in the rational decision-making model. For example, this model proposed that we should search for all possible alternatives before making a decision, but that process is time consuming, and individuals are often under time pressure to make decisions. Moreover, even if we had access to all the information that was available, it could be challenging to compare the pros and cons of each alternative and rank them according to our preferences. Anyone who has recently purchased a new laptop computer or cell phone can attest to the challenge of sorting through the different strengths and limitations of each brand and model and arriving at the solution that best meets particular needs. In fact, the availability of too much information can lead to analysis paralysis , in which more and more time is spent on gathering information and thinking about it, but no decisions actually get made. A senior executive at Hewlett-Packard Development Company LP admits that his company suffered from this spiral of analyzing things for too long to the point where data gathering led to “not making decisions, instead of us making decisions” (Zell, Glassman, & Duron, 2007). Moreover, you may not always be interested in reaching an optimal decision. For example, if you are looking to purchase a house, you may be willing and able to invest a great deal of time and energy to find your dream house, but if you are only looking for an apartment to rent for the academic year, you may be willing to take the first one that meets your criteria of being clean, close to campus, and within your price range.

Making “Good Enough” Decisions

The bounded rationality model of decision making recognizes the limitations of our decision-making processes. According to this model, individuals knowingly limit their options to a manageable set and choose the first acceptable alternative without conducting an exhaustive search for alternatives. An important part of the bounded rationality approach is the tendency to satisfice (a term coined by Herbert Simon from satisfy and suffice ), which refers to accepting the first alternative that meets your minimum criteria. For example, many college graduates do not conduct a national or international search for potential job openings. Instead, they focus their search on a limited geographic area, and they tend to accept the first offer in their chosen area, even if it may not be the ideal job situation. Satisficing is similar to rational decision making. The main difference is that rather than choosing the best option and maximizing the potential outcome, the decision maker saves cognitive time and effort by accepting the first alternative that meets the minimum threshold.

Making Intuitive Decisions

The intuitive decision-making model has emerged as an alternative to other decision making processes. This model refers to arriving at decisions without conscious reasoning. A total of 89% of managers surveyed admitted to using intuition to make decisions at least sometimes and 59% said they used intuition often (Burke & Miller, 1999). Managers make decisions under challenging circumstances, including time pressures, constraints, a great deal of uncertainty, changing conditions, and highly visible and high-stakes outcomes. Thus, it makes sense that they would not have the time to use the rational decision-making model. Yet when CEOs, financial analysts, and health care workers are asked about the critical decisions they make, seldom do they attribute success to luck. To an outside observer, it may seem like they are making guesses as to the course of action to take, but it turns out that experts systematically make decisions using a different model than was earlier suspected. Research on life-or-death decisions made by fire chiefs, pilots, and nurses finds that experts do not choose among a list of well thought out alternatives. They don’t decide between two or three options and choose the best one. Instead, they consider only one option at a time. The intuitive decision-making model argues that in a given situation, experts making decisions scan the environment for cues to recognize patterns (Breen, 2000; Klein, 2003; Salas & Klein, 2001). Once a pattern is recognized, they can play a potential course of action through to its outcome based on their prior experience. Thanks to training, experience, and knowledge, these decision makers have an idea of how well a given solution may work. If they run through the mental model and find that the solution will not work, they alter the solution before setting it into action. If it still is not deemed a workable solution, it is discarded as an option, and a new idea is tested until a workable solution is found. Once a viable course of action is identified, the decision maker puts the solution into motion. The key point is that only one choice is considered at a time. Novices are not able to make effective decisions this way, because they do not have enough prior experience to draw upon.

Making Creative Decisions

In addition to the rational decision making, bounded rationality, and intuitive decision-making models, creative decision making is a vital part of being an effective decision maker. Creativity is the generation of new, imaginative ideas. With the flattening of organizations and intense competition among companies, individuals and organizations are driven to be creative in decisions ranging from cutting costs to generating new ways of doing business. Please note that, while creativity is the first step in the innovation process, creativity and innovation are not the same thing. Innovation begins with creative ideas, but it also involves realistic planning and follow-through. Innovations such as 3M’s Clearview Window Tinting grow out of a creative decision-making process about what may or may not work to solve real-world problems.

The five steps to creative decision making are similar to the previous decision-making models in some keys ways. All the models include problem identification, which is the step in which the need for problem solving becomes apparent. If you do not recognize that you have a problem, it is impossible to solve it. Immersion is the step in which the decision maker consciously thinks about the problem and gathers information. A key to success in creative decision making is having or acquiring expertise in the area being studied. Then, incubation occurs. During incubation, the individual sets the problem aside and does not think about it for a while. At this time, the brain is actually working on the problem unconsciously. Then comes illumination, or the insight moment when the solution to the problem becomes apparent to the person, sometimes when it is least expected. This sudden insight is the “eureka” moment, similar to what happened to the ancient Greek inventor Archimedes, who found a solution to the problem he was working on while taking a bath. Finally, the verification and application stage happens when the decision maker consciously verifies the feasibility of the solution and implements the decision.

Figure 11.6 The Creative Decision-Making Process

A NASA scientist describes his decision-making process leading to a creative outcome as follows: He had been trying to figure out a better way to de-ice planes to make the process faster and safer. After recognizing the problem, he immersed himself in the literature to understand all the options, and he worked on the problem for months trying to figure out a solution. It was not until he was sitting outside a McDonald’s restaurant with his grandchildren that it dawned on him. The golden arches of the M of the McDonald’s logo inspired his solution—he would design the de-icer as a series of Ms. [1] This represented the illumination stage. After he tested and verified his creative solution, he was done with that problem, except to reflect on the outcome and process.

How Do You Know If Your Decision-Making Process Is Creative?

Researchers focus on three factors to evaluate the level of creativity in the decision-making process. Fluency refers to the number of ideas a person is able to generate. Flexibility refers to how different the ideas are from one another. If you are able to generate several distinct solutions to a problem, your decision-making process is high on flexibility. Originality refers to how unique a person’s ideas are. You might say that Reed Hastings, founder and CEO of Netflix Inc. is a pretty creative person. His decision-making process shows at least two elements of creativity. We do not know exactly how many ideas he had over the course of his career, but his ideas are fairly different from each other. After teaching math in Africa with the Peace Corps, Hastings was accepted at Stanford, where he earned a master’s degree in computer science. Soon after starting work at a software company, he invented a successful debugging tool, which led to his founding of the computer troubleshooting company Pure Software LLC in 1991. After a merger and the subsequent sale of the resulting company in 1997, Hastings founded Netflix, which revolutionized the DVD rental business with online rentals delivered through the mail with no late fees. In 2007, Hastings was elected to Microsoft’s board of directors. As you can see, his ideas are high in originality and flexibility (Conlin, 2007).

Figure 11.7 Dimensions of Creativity

Some experts have proposed that creativity occurs as an interaction among three factors: people’s personality traits (openness to experience, risk taking), their attributes (expertise, imagination, motivation), and the situational context (encouragement from others, time pressure, physical structures) (Amabile, 1988; Amabile et al., 1996; Ford & Gioia, 2000; Tierney, Farmer, & Graen, 1999; Woodman, Sawyer, & Griffin, 1993). For example, research shows that individuals who are open to experience, less conscientious, more self-accepting, and more impulsive tend to be more creative (Feist, 1998).

OB Toolbox: Ideas for Enhancing Organizational Creativity

Team Composition

• Diversify your team to give them more inputs to build on and more opportunities to create functional conflict while avoiding personal conflict.
• Change group membership to stimulate new ideas and new interaction patterns.
• Leaderless teams can allow teams freedom to create without trying to please anyone up front.

Team Process

• Engage in brainstorming to generate ideas. Remember to set a high goal for the number of ideas the group should come up with, encourage wild ideas, and take brainwriting breaks.
• Use the nominal group technique (see Tools and Techniques for Making Better Decisions below) in person or electronically to avoid some common group process pitfalls. Consider anonymous feedback as well.
• Use analogies to envision problems and solutions.
• Challenge teams so that they are engaged but not overwhelmed.
• Let people decide how to achieve goals , rather than telling them what goals to achieve.
• Support and celebrate creativity even when it leads to a mistake. Be sure to set up processes to learn from mistakes as well.
• Role model creative behavior.
• Institute organizational memory so that individuals do not spend time on routine tasks.
• Build a physical space conducive to creativity that is playful and humorous—this is a place where ideas can thrive.
• Incorporate creative behavior into the performance appraisal process.

Sources: Adapted from ideas in Amabile, T. M. (1998). How to kill creativity. Harvard Business Review , 76 , 76–87; Gundry, L. K., Kickul, J. R., & Prather, C. W. (1994). Building the creative organization. Organizational Dynamics , 22 , 22–37; Keith, N., & Frese, M. (2008). Effectiveness of error management training: A meta-analysis. Journal of Applied Psychology , 93 , 59–69. Pearsall, M. J., Ellis, A. P. J., & Evans, J. M. (2008). Unlocking the effects of gender faultlines on team creativity: Is activation the key? Journal of Applied Psychology , 93 , 225–234. Thompson, L. (2003). Improving the creativity of organizational work groups. Academy of Management Executive , 17 , 96–109.

There are many techniques available that enhance and improve creativity. Linus Pauling, the Nobel Prize winner who popularized the idea that vitamin C could help strengthen the immune system, said, “The best way to have a good idea is to have a lot of ideas.” [2] One popular method of generating ideas is to use brainstorming. Brainstorming is a group process of generating ideas that follow a set of guidelines, including no criticism of ideas during the brainstorming process, the idea that no suggestion is too crazy, and building on other ideas (piggybacking). Research shows that the quantity of ideas actually leads to better idea quality in the end, so setting high idea quotas , in which the group must reach a set number of ideas before they are done, is recommended to avoid process loss and maximize the effectiveness of brainstorming. Another unique aspect of brainstorming is that since the variety of backgrounds and approaches give the group more to draw upon, the more people are included in the process, the better the decision outcome will be. A variation of brainstorming is wildstorming , in which the group focuses on ideas that are impossible and then imagines what would need to happen to make them possible (Scott, Leritz, & Mumford, 2004).

Figure 11.8

Which decision-making model should I use?

Key Takeaway

Decision making is choosing among alternative courses of action, including inaction. There are different types of decisions ranging from automatic, programmed decisions to more intensive nonprogrammed decisions. Structured decision-making processes include rational, bounded rationality, intuitive, and creative decision making. Each of these can be useful, depending on the circumstances and the problem that needs to be solved.

• What do you see as the main difference between a successful and an unsuccessful decision? How much does luck versus skill have to do with it? How much time needs to pass to know if a decision is successful or not?
• Research has shown that over half of the decisions made within organizations fail. Does this surprise you? Why or why not?
• Have you used the rational decision-making model to make a decision? What was the context? How well did the model work?
• Share an example of a decision in which you used satisficing. Were you happy with the outcome? Why or why not? When would you be most likely to engage in satisficing?
• Do you think intuition is respected as a decision-making style? Do you think it should be? Why or why not?

Amabile, T. M. (1988). A model of creativity and innovation in organizations. In B. M. Staw & L. L. Cummings (Eds.), Research in organizational behavior, vol. 10 (pp. 123–167) Greenwich, CT: JAI Press.

Amabile, T. M., Conti, R., Coon, H., Lazenby, J., & Herron, M. (1996). Assessing the work environment for creativity. Academy of Management Journal , 39 , 1154–1184.

Breen, B. (2000, August). What’s your intuition? Fast Company , 290.

Burke, L. A., & Miller, M. K. (1999). Taking the mystery out of intuitive decision making. Academy of Management Executive , 13 , 91–98.

Conlin, M. (2007, September 14). Netflix: Recruiting and retaining the best talent. Business Week Online . Retrieved March 1, 2008, from http://www.businessweek.com/managing/content/sep2007/ca20070913_564868.htm?campaign_id=rss_null .

Feist, G. J. (1998). A meta-analysis of personality in scientific and artistic creativity. Personality and Social Psychology Review , 2 , 290–309.

Ford, C. M., & Gioia, D. A. (2000). Factors influencing creativity in the domain of managerial decision making. Journal of Management , 26 , 705–732.

Garvin, D. A. (2006, January). All the wrong moves. Harvard Business Review , 84 , 18–23.

Ireland, R. D., & Miller, C. C. (2004). Decision making and firm success. Academy of Management Executive , 18 , 8–12.

Klein, G. (2003). Intuition at work . New York: Doubleday.

Nutt, P. C. (1994). Types of organizational decision processes. Administrative Science Quarterly , 29 , 414–550.

Nutt, P. C. (1998). Surprising but true: Half the decisions in organizations fail. Academy of Management Executive , 13 , 75–90.

Nutt, P. C. (1999). Surprising but true: Half the decisions in organizations fail. Academy of Management Executive , 13 , 75–90.

Nutt, P. C. (2002). Why decisions fail . San Francisco: Berrett-Koehler.

Salas, E., & Klein, G. (2001). Linking expertise and naturalistic decision making . Mahwah, NJ: Lawrence Erlbaum Associates.

Scott, G., Leritz, L. E., & Mumford, M. D. (2004). The effectiveness of creativity training: A quantitative review. Creativity Research Journal , 16 , 361–388.

Tierney, P., Farmer, S. M., & Graen, G. B. (1999). An examination of leadership and employee creativity: The relevance of traits and relationships. Personnel Psychology , 52 , 591–620.

Woodman, R. W., Sawyer, J. E., & Griffin, R. W. (1993). Toward a theory of organizational creativity. Academy of Management Review , 18 , 293–321.

Zell, D. M., Glassman, A. M., & Duron, S. A. (2007). Strategic management in turbulent times: The short and glorious history of accelerated decision making at Hewlett-Packard. Organizational Dynamics , 36 , 93–104.

• In person interview conducted by author at Ames Research Center, Mountain View, CA, 1990. ↵
• Quote retrieved May 1, 2008, from http://www.whatquote.com/quotes/linus-pauling/250801-the-best-way-to-have.htm . ↵

Organizational Behavior Copyright © 2017 by University of Minnesota is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License , except where otherwise noted.

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Decision-making in the workforce is a process of responsibilities used by upper management to implement, enforce rules, regulations, and maintain a successful environment. Decision-making implemented more effectively by making a plan, thinking it through, accepting more than one opinion and determining what is best. However, decision-making often utilized more effectively by opening doors of opportunities for a suggestion, question, discussion, and feedback. Although, more involvement helps improve understanding, utilize behavior skills and present opportunities for better communication. Everyday life consists of decision-making, the right decision may not always be applied, but ensure room for improvement and opportunity. Individuals approached decision-making in many different ways. As stated by (Jones, Graham, & Bateman, 2006) decision making is a procedure used to recognize a problem, weigh the alternatives and evaluate a solution in which, certain situations will require different approaches to become effective.

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Essay on The Strategic Planning Process

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Today, new organizations are being formed continuously and, as a result, competition is fierce. It is key that organizations should use be able to make well-informed decision in order to be successful in business. However, most of these organizations are not able to make decisions effectively due to business data are not kept appropriately. Furthermore, if organizations do not provide strategic information for making decisions, the organizations will not gain competitive advantages, nor predict future outcomes. Thus, revenues and profits of organizations will be affected. Therefore, by considering this issue, it might be possible to offer solutions for organizations to develop effective decision making strategies.

Assignment 3 Creating Training Tools Paper

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The Process of Decision Making Essay

As stated by Prasad (2008), the managers should identify the different choices available in order to get most acceptable outcome of a decision. From searching different alternatives the managers can evade blocks in operations as choices are suitable if a particular idea goes wrong. Khanka (2000) expresses the view that selections can developed from in many ways such as can get from sources like experience, do training other organizations, and take others ideas and suggestions related in problems. Furthermore to improve alternatives solution the managers may investigation the signs of a problem for clues or fall back on intuition or result that stated by Griffin and Moorhead (2010). For an example in marketing department a non-programmed decision is compulsory the manager have to produce alternatives for raise market share. As McShane and Von Glinow (2000) pointed out that in a programmed decision is a standard operations is not to generate choice but can take out from the documented that already saved. Next an organizer should search the mission of a decision. In other words they need to define what is to be accomplished by it (Quick & Nelson, 2013). The decision criteria are important as mentioned by Dubrin (2002). The several criteria are consumers must aware of varies in quality of products, there not happen inflation, workers must consider the quality of improvements and lastly job satisfaction should not be reduce.

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Generating potential solutions, evaluating the solutions, deciding, checking the decisions and communicating and implementing the decisions were the six areas covered during the quiz (Mind Tools, 2014). Decisions made at the strategic, routine, project/non-routine, or operational levels have different impacts (CSU-Global, 2014) and consequences if not managed properly. This paper will address each of the six areas evaluated, discuss the four levels that decisions are made and show my improvement plan to improve this competency.

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The decision is to select an action among a number of actions that solves a given problem, that prevents a problem from happening, or that forces to apply new ideas for development. The need for understanding decision making process is increasing because the complexity of modern organizations is increasing, and because the modern organizations' effectiveness depends on the decisions made by the managers. The question is how to select the most appropriate action to solve the problem satisfying all stakeholders.

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Essay on Decision-Making in an Organisation

Read this essay to learn about Decision-Making in an Organisation. After reading this essay you will learn about:- 1. Meaning of Decision-Making 2. Features of Decision-Making 3. Process 4. Approaches 5. Environment 6. Techniques 7. Models.

• Essay on the Models of Decision-Making

Essay # 1. Meaning of Decision-Making :

Decision-making means selecting a course of action out of alternative courses to solve a problem. Unless there is a problem, there is no decision-making. Decision-making and problem- solving are inter-related. It is the process through which managers identify organisational problems and solve them.

Decisions may be major or minor, strategic or operational, long-term or short-term. They are made for each functional area at each level. The importance of decisions, however, varies at each level. Long-term, major and strategic decisions are taken at the top level and relatively short-term, minor and operational decisions are taken at lower levels.

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Decision-making precedes every managerial function. Decisions regarding what goals and ways to achieve them (decisions before planning), design of the organisation structure and span of management (decisions before organising), number and type of employees required, sources of recruitment, method of selection, training and development methods, best match between job description and job specification (decisions before staffing), incentive system, leadership styles and communication channel (decisions before directing) and techniques of control (decisions before controlling) are taken for smooth running and growth of business operations. Decision­ making is not easy.

All decisions are not based on past behaviour and practices (objective decision-making). Most of the decisions in the complex environment are subjective in nature. They are based on managers’ knowledge, value judgment, creativity and innovative abilities.

Managers do not make same decisions in same situations. It is situational in nature and depends upon managers’ psychology and perception of the situation. Decision-making is a modest attempt to match environmental opportunities with organisational strengths. It is based on forecasts and assumptions about environmental factors.

“A decision is a conscious choice to behave or to think in a particular way in a given set of circumstances. When a choice has been made, a decision has been made.” — J. W. Duncan

Decision-making is “the selection of a course of action from among alternatives; it is the core of planning”. — Koontz and Weihrich

Decision-making is “the process through which managers identify organisational problems and attempt to resolve them”. — Bartol and Martin

Essay # 2. Features of Decision-Making :

Decision-making has the following features:

1. Decision-making is goal-oriented. The purpose of decision is to achieve a goal; sectional, departmental and organisational.

2. It is required for every managerial function though it is closely related to planning. How good are the decisions determines how effective are the organisational plans.

3. It is a process of choice; choosing a course of action out of various courses to solve a specific problem.

4. Problem-solving is the basis for decision-making as decisions are made to solve problems. Unless there are problems, there will be no decision-making.

5. Decisions are made to solve organisational problems and exploit environmental opportunities. Both problems and opportunities, thus, need decision-making.

6. It is a pervasive process. Decisions are made in business and non-business organisations. In business organisations, they are made at all levels.

7. Decisions are made at all levels in the organisation; though nature and importance of decisions vary at different levels. However, organisational effectiveness is determined by the quality of decisions at all the levels.

8. It is required for every situation — certainty, risk or uncertainty.

9. It is situational in nature. Different situations (both internal and external to the organisation) require different decisions. Not to make a decision is also a decision in some situations.

10. It is a continuous process. Managers continuously evaluate organisational activities and find problems that require decision-making.

11. It is an intellectual process. Managers use judgment, knowledge and creativity to develop solutions to the problem.

12. A manager is oriented towards making decisions rather than performing the actions personally; actions are carried out by others.

Essay # 3. Process of Decision-Making:

Decision-making process involves the following steps:

(i) Identify the Problem:

Decisions help to solve problems. As a first step to decision-making, therefore, managers identify the problem. Problem is any deviation from a set of expectations. It is the gap between the present and the desired state. Managers scan the internal and external environment to see if organisational operations conform to environmental standards. If not, there is a problem.

If sales target is 10,000 units per annum but actual sales are 7,000 units, managers sense problem in the company. The problem is identified with the marketing department. Managers use their judgment, imagination and experience to identify the problem as wrong identification leads to wrong decisions.

It is not necessary that managers take decisions only when the problems arise. They should also find the problems by searching for areas where threats or opportunities can arise and decide how to prevent threats and exploit the opportunities when they occur.

Guth and Taiguri assert that probable areas where managers would look for decision-making are guided by their value judgments like:

(a) Economic values:

Managers search for problems in areas where profit can be maximised.

(b) Theoretical values:

More than profits, managers are guided by forces to achieve long-term goals of the organisation (wealth maximisation) within the framework of environmental forces.

(c) Political values:

Managers backed by political values aim to achieve their personal goals.

Alarming Situations for Decision-making :

According to William Pounds, situations that call for decision-making fall into four categories:

(a) Deviation from past:

If current year’s performance significantly differs from past year’s performance, it requires decision-making. For example, sales of the current year fall significantly short of last year’s sales. It signals a problem that requires decision-­making.

(b) Deviation from plans:

If actual performance is not in accordance with the planned performance, it requires decision-making. If actual sales are less than planned sales, managers should decide about how to increase the sales.

(c) Deviation noticed by others:

If quality of goods or standards of working hours are not adhered to, the matter may come to the notice of managers through customers or supervisors and, thus, needs decision-making.

(d) Perception about competitors:

If managers perceive that competitors are following a new strategy for creating customer loyalty or upgrading their technology to reduce cost of production, it requires immediate decision-making by managers. Decision-making is required not only to meet inter-organisational competition but also at the intra-organisation level.

Where a company has different plants or units, managers compare the performance of one unit with that of another and if there is deviation in performance of any unit, they decide about improving the performance of the unit not doing well.

(ii) Diagnose the Problem:

Diagnosis involves identifying the problem through its symptoms. Symptoms which indicate deviation from the standard objectives or actions indicate a problem that needs to be solved through the decision-making process.

Diagnosis involves identifying gap between the present and the future, identifying reasons why this gap has arisen and then going to the depth of the problem through decision-making. Managers collect facts and information to find cause of the problem. Diagnosis helps to define the problem; its causes, dimensions, degree of severity, magnitude and origin so that remedial action can be taken.

Managers get to the core of the problem and isolate it in a separate category of operations called the problem-solving area. In the above example, managers search for reasons of low sales. It could be low quality, poor promotion, better product introduced by competitors etc. The exact reason is found so that problem is diagnosed.

(iii) Establish Objectives:

Objective is the end result that managers achieve through the decision­ making process. Establishing objectives means deciding to solve the problem. The resolution forms the objective of decision-making. If the reason for low sales is poor salesmanship, managers form the objective to improve the skills of salesmen to promote sales.

Henry Mintzberg, Duree Raisignhani and Andre Theoret explain three types of problems that require decision-making:

(a) Crisis:

It is a situation which requires immediate attention of managers and decisions to solve the problems. For example, if workers go on strike, management cannot sit back to think and take action. The problem needs to be immediately resolved.

(b) Non-crisis:

These problems do not require immediate attention as they can be resolved over a period of time. Most of the decisions relate to situations/problems which are non-crisis in nature. An employee who is regularly late for work represents a non-crisis problem. “A non-crisis problem is an issue that requires resolution but does not simultaneously have the importance and immediacy characteristic of a crisis.”

(c) Opportunity:

The situations of crisis and non-crisis reflect difficulties or problems that need to be solved but opportunities offer ideas which improve organisational efficiency. Managers reflected in take action immediately when opportunities are offered by the environmental forces to gain edge over competitors. Opportunities offer new ideas and directions to organisation’s operations. They provide profits to the organisation if timely decisions are made by managers.

(iv) Collect Information:

In order to generate alternatives to solve the problem, managers collect information from the internal and external environment. Information provides inputs for generating solutions. Information can be quantitative or qualitative. It should be reliable, adequate and timely so that right action can be taken at the right time.

(v) Generate Alternatives:

Alternatives means developing two or more ways of solving the problem. Managers develop as many solutions as possible to choose the best, creative and most applicable alternative to solve the problem. Alternatives are required as generally, there is more than one way to solve the problem. The decision-maker should collect information with respect to feasible solutions that can provide satisfactory solution to the problem.

Though the decision-maker attempts to generate maximum information on which he bases his decisions, it may not always be possible either because of his physical, mental or time constraints or because of environmental constraints (the complete information may not be available).

He should, thus, generate alternatives on the basis of principle of limiting factor, that is, factors which limit the generation of alternatives should not be part of the decision alternatives. For example, if the decision-maker is constrained by time factor as the decision relates to the situation of crisis, he cannot wait for information that takes long time to collect to generate decision alternatives. He will not consider options where collecting information is time-consuming.

Alternatives can be generated in the following ways:

(a) The decision-maker uses his past experience to deal with problem situations that have occurred before. Though past actions form the basis for future actions, it may not be possible in case of situations where present challenges are significantly different from the past challenges.

(b) He adopts the decision taken by other managers in the same or different companies if the outcome of that decision, in a similar situation, was positive. Changes are, however, made in the light of present circumstances which require decision-making.

(c) He can adopt scientific and creative techniques to solve problems.

A.F. Osborn identifies four principles which help to generate alternatives:

(a) Do not criticize ideas while generating possible solutions:

Managers should react positively to all the ideas. Criticism at the stage of generating solutions can limit the number of alternatives.

(b) Freewheel:

Even the remote solutions which may not be relevant to the problem should be taken into consideration. These may not be acceptable independently but may be useful in the overall decision-making process.

(c) Offer as many ideas as possible:

Managers should invite maximum ideas for framing solutions to the problem. Large number of ideas helps to arrive at effective solution to the problem.

(d) Combine and improve on ideas that have been offered:

Combination of all the ideas helps to arrive at the best solution.

(vi) Evaluate Alternatives:

The alternatives are weighed against each other with respect to their strengths and weaknesses. They are useful if they help to achieve the objective. Alternatives are evaluated in terms of acceptable criteria to analyse their impact on the problem.

Alternatives are evaluated against the following quantitative and qualitative criteria:

Alternatives should not be costly. Improving the skills of salesmen by firing the existing salesmen and hiring new ones may involve strain on financial resources. Such alternatives should be avoided.

The alternatives should fit into the organisation’s resource structure. They should be feasible with respect to budgets, policies and technological set up of the organisation.

Acceptable:

Alternatives should be acceptable to decision-makers and those who are affected by the decisions. If managers want to increase sales by spending more on advertisement but finance department refuses to accept the financial burden on advertisement, this alternative should be dropped.

Reversible:

A decision is reversible if it can be taken back and other measures can be adopted. In the above example, if decision to increase sales by increasing cost of advertisement is not acceptable to all in the organisation, it can be reversed but decision to invest in land and building cannot be easily reversed as huge amount of time, effort and money are involved in it. Reversibility of the decision is an important factor that helps to evaluate alternatives.

The evaluation of alternatives is, thus, based on the following criteria:

(a) Tangible factors like cost and resources are the quantitative factors that help in evaluation of alternatives, though, once the decision is implemented, actual cost and resource adjustment may be different from that predicted. This is because of the limitations or constraints under which managers make the decisions.

(b) Intangible factors like acceptability and reversibility are the qualitative factors that cannot be measured but have significant impact on evaluation of various decision alternatives. Both these factors help in evaluation of alternatives so that best and satisfactory alternative can be chosen that contributes to organisational objectives.

(vii) Select the Alternative:

After evaluating the alternatives against accepted criteria, managers screen the non-feasible alternatives and select the most appropriate alternative to achieve the desired objective. Though the chosen alternative may not be the best, it is the most satisfactory alternative in light of the decision criteria of tangible and intangible factors that will contribute to organisational objectives.

Alternative can be selected through the following approaches:

(a) Experience:

Past experience guides the future. Based on past experience, managers choose alternatives which they have chosen earlier to solve similar problems. Managers follow past actions, search for their successes and failures, analyse them in the context of future environment and select the most suitable alternative that suits the present situation.

(b) Experimentation:

An alternative to experience is experimentation where each alternative is put to practice and the most suitable alternative is selected. This method is costly as implementation of every alternative to the decision-making situation involves heavy time and capital expenditure.

Testing each alternative, therefore, is not feasible. This method is generally used in marketing where pre-launch helps in knowing acceptability of the product so that changes in product features can be made before launching the final product in the market.

(c) Research and analysis:

It helps to search and analyse the impact of future variables on the present situations, apply mathematical models and select the most suitable alternative. This method is more suitable and less costly, in terms of time and money, as compared to experimentation and experience.

(viii) Implement the Alternative:

Though decision-making process is complete once the decision alternative is selected, managers should ensure that the decision helps in achieving the desired objective. Therefore, it is important that implementation of the alternative and its monitoring (or feedback) form part of the decision-making process.

The selected alternative is accepted and implemented by the organisational members. Implementation must be planned. Those who will be affected by implementation should participate in the implementation process to make it effective and fruitful.

Implementation of the alternative ensures the following:

(a) The selected alternative is communicated to everyone in the organisation.

(b) Changes in the organisation structure because of implementation are communicated to everyone in the organisation.

(c) Authority and responsibility for implementation are specifically assigned.

(d) Resources are allocated to departments to carry out the decisions.

(e) Budgets, schedules, procedures and controls are established to ensure effective implementation.

(f) A committed workforce is promoted. Unless everyone is committed to the decision, the desired outcome will not be achieved.

(ix) Monitor the Implementation:

The implementation of decision is aimed to achieve the objective for which it is chosen. The outcome of decision indicates whether the right decision is chosen and implemented or not. The implementation process is monitored to know its acceptability amongst organisational members. The alternative is regularly monitored, through progress reports, to see whether the objective for which it was selected is achieved or not.

Through feedback received from the results or outcomes of decisions, managers take the follow-up action. If results deviate from the objectives, managers try to find out the reasons responsible for deviations and make corrections in the implementation process. It may even require review of the entire decision-making process.

A good decision, thus, requires that results of the decision should contribute to objectives of the decision and if required, changes should be made in the decisions in the light of changing circumstances. If results match the objectives, such alternative forms the basis for future decision-making.

Essay # 4. Approaches to Decision-Making :

Decisions can be taken in different ways.

Four main approaches to decision-making are discussed below:

(i) Centralised and Decentralised Approach:

In centralised approach to decision-making, maximum decisions are taken by top-level managers though some responsibility is delegated to middle-level managers. In the decentralised approach, decision-making authority is delegated to lower-level managers. In programmed decisions, decentralised approach is followed. Centralised approach is used to make non-programmed decisions.

(ii) Group and Individual Approach:

Managers take decisions with their employees/ subordinates in the group approach to decision-making. In the individual approach, decisions are taken by the manager alone. It is the one-manager decision-making approach.

The individual approach is appropriate when:

(1) There is urgency for taking decisions, i.e., decision ­maker has limited time to take a decision, and

(2) Resources are limited.

Cost of individual decision-making is less than group decision-making. Group decision-making, in most circumstances, is better than individual decision-making since decisions are based on extensive information. Group decisions are easier to implement as they involve moral commitment of the members to adhere to the decisions. This approach ensures better quality and greater accuracy of decisions. It also improves employees’ morale, job satisfaction, co-ordination and reduces labour turnover rate.

(iii) Participatory and Non-Participatory Approach:

In the participatory approach, managers seek opinion of those who are affected by the decisions. There is no formal gathering of superiors and subordinates, as in group decision-making. The decision-maker only seeks information and suggestions from subordinates and reserves the right of making decisions. There is increased participation of subordinates in achieving the decision objectives.

In the non-participatory approach, managers do not seek information from subordinates as the decisions do not directly affect them. They collect information, make decisions and communicate them to the organisational members.

(iv) Democratic and Consensus Approach :

In the democratic approach, decisions are based on voting by majority. In the consensus approach, participants discuss the matter and arrive at a general consensus. It is similar to group decision-making where many people are involved in the decision-making process.

However, in group decision-making, some people agree to others because of social or psychological pressures but in consensus decision-making, all members unanimously agree to the decision. Group decision-making reflects the opinion of a few and consensus decision-making reflects the opinion of all the group members.

Essay # 5. Environment of Decision-Making:

Environment of decision-making represents the known and unknown environmental variables in which decisions are made. Some decisions are taken in situations of complete certainty and others in the situation of complete/partial uncertainty.

Decision-making environment represents the situations in which decisions are made. Decision alternatives represent a course of action to be taken for future environmental conditions which vary along a continuum with perfect certainty at one end of the continuum and perfect certainty at the other.

Situations intermediate between the two extremes represent the conditions of risk, high or low, depending on their nearness towards uncertainty or certainty. The decision outcomes differ in different conditions.

The continuum representing the decision-making conditions can be represented as follows:

Managers will decide to sell in the Northern region in order to maximise monetary gain: Rs. 40 lakh. He chooses between 2 maximum gains: Rs. 40 lakh in Northern region and Rs. 25 lakh in Southern region. Possible losses and risk in achieving the target objectives are ignored.

(b) If the manager is pessimistic in nature, instead of maximising the maximum returns, he aims to maximise the minimum return. The least favourable return is aimed to be maximised. If in the above example, the demand for product in the Northern region is assessed in 3 different states : low, medium and higher as Rs. 10 lakh, Rs. 30 lakh, Rs. 40 lakh respectively, and in the Southern region as 5 lakh, Rs.20 lakh and Rs.25 lakh, the decision maker is prepared for the worst to happen.

Thus, he chooses between Rs.10 lakh in Northern region and Rs. 15 lakh in Southern region. Out of the two minimum pay offs, he maximises the pay off in the Southern region and, thus, selects to launch the product in the Southern region. This criterion of maximising the minimum value of the decision alternatives is called maximin criterion as its objective is to select the maximum value out of the minimum values of various decision alternatives. It maximises the minimum pay off.

(c) Though the manager predicts the demand for different situations for different decision alternatives, there is always the risk that if he selects the most favourable payoff, that payoff may not actually occur so that managers regret the decision. Thus, the manager wants to minimise his regret as he does not know whether the selected alternative may or may not happen. He, therefore, chooses an alternative which minimizes his regret.

In the decision alternatives, as discussed in the following example:

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• Decision Making and Organizational Change and Development Essay

Decision Making And Organizational Change And Development Essay

Notably, these differences are evident following the intentional introduction or development of new thinking patterns, new activities, and new ways of operating. Their consideration of organizational change and development as a process rather than a field or profession is influenced by the main objective of the process. In this case, the main objective of organizational change and development is to promote adaptation to the environment and/or contribute to better performance. Pieterse, Caniels & Homan (2012) concur with this definition and general aim of organizational change and development by reckoning that organizations are increasingly changing and adapting constantly in order to remain competitive (p.798). However, while organizations change and adapt to enhance their competitiveness, the change process is usually motivated or influenced by several strategic considerations. In addition to strategic considerations, the process of organizational change and development is also influenced by the need for more integrated means of working and the need to enhance business performance. These factors combine to generate structured change programs that are based on the belief that change management entails a series of interventions and practices. These interventions are considered to be objective, quantifiable, and linearly controllable programs or initiatives that can be accomplished within a short period of time relative to the desired objectives. The existing academic literature on organizational change and development has been characterized by many confusing and contradictory theories and research findings regarding the process of change management and its success. These contradictory and confusing theories emerge from the fact that existing academic literature is drawn from a broad range of theoretical perspectives and disciplines, which generates complexities (Barnard & Stoll, 2010). One of the most influential perspectives in current academic literature on the process of organizational change and development is Lewin's Theory, which proposes planned approaches to change. The theory suggests that organizational change and development comprises three major steps i.e. unfreezing existing behavior, transitioning to new behavior, and refreezing the new behavior. This three-step model has been adopted for several years, especially in academic literature, as the major framework for understanding organizational change and development. Following a review of Lewin's three-step model for understanding organizational change and development, other approaches have been developed. In attempts to make the stages of this process more specific, Bullock and Batten created a new approach i.e. a four-stage model where organizational change and development involves exploration, planning, action, and integration. The other approach to be developed is the emergent approach, which is considered as an alternative to planned approaches towards organizational change and development. Based on this approach, organizational change and development is rapid and unpredictable, which implies that it cannot be managed from the top down (Barnard & Stoll, 2010). The emergent approach suggests that organizational change and development should be viewed as a process of learning through which the organization effectively responds to internal and external changes in the environment. Therefore, this model does not provide specific pre-planned stages for understanding or explaining organizational change and development but is centered on readiness for change and facilitating change and development. Given the significance of organizational change and development in the modern business environment, resistance to change is an issue that has also attracted considerable attention from scholars. According to Pieterse, Caniels & Homan (2012), resistance to change is one of the major contributing factors to low success rates in organizational change and development programs (p.799). Actually, scholars agree that there is need for a more nuanced outlook of this issue in order to generate conclusive factors that generate it. The resistance to change, which partly hinders the success of organizational change and development programs, is attributed to issues related to employees (Pieterse, Caniels & Homan, 2012, p.799). Barnard & Stoll (2010), support these claims by contending that one of the fundamental elements in the success organizational change and development is acceptance of such programs by employees. This is primarily because humans undergo different stages of grief when faced with change or loss i.e. denial, anger, negotiation, depression, and acceptance. As employees undergo these stages, they are more likely to resist programs and initiatives focusing on organizational change and development, which lowers their success rates. Manuela & Clara (n.d.) divide the sources of resistance to organizational change and development into five groups i.e. distorted perception, low motivation, lack of creative response, political and cultural…

Sources Used in Documents:

References Barnard, M. & Stoll, N. (2010, October). Organizational Change Management: A Rapid Literature Review. Retrieved from Bristol Institute of Public Affairs website: http://www.bristol.ac.uk/media-library/sites/cubec/migrated/documents/pr1.pdf Choi, M. & Ruona, W.E.A. (2011, March). Individual Readiness for Organizational Change and Its Implications for Human Resource and Organization Development. Human Resource Development Review, 10(1), 46-73. Manuela, P.V. & Clara, M.F. (n.d.). Resistance to Change: A Literature Review and Empirical Study. Retrieved from University of Valencia website: http://www.uv.es/~pardoman/resistencias.PDF Mykkanen, M. & Vos, M. (2015). The Contribution of Public Relations to Organizational Decision Making: Insights from the Literature. Public Relations Journal, 9(2), 1-17. Sipp, C.M. & Carayannis, E.G. (2013). Literature Review. In Real options and strategic technology venturing: a new paradigm in decision making (chap. 2, pp. 15-38). Retrieved from http://www.springer.com/cda/content/document/cda_downloaddocument/9781461458135-c1.pdf?SGWID=0-0-45-1355417-p174672098

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Organizational Learning and Decision-Making

Reading article- “garvin, d.a 1993”, what is this article about.

This article discusses how learning organizations are built. This has been achieved by exploring the meaning of learning organizations, how they are managed and how the learning aspect is measured. It demonstrates some of the practical ways of advancing a learning organization based on some the common principles and philosophies. It brings out a clear picture of a learning organization and what it generally entails.

The article gives a comprehensive exposition of the topic on learning in organizations. It accounts for knowledge transfer, creation and acquisition of skills. It also illustrates behavior modifications in terms of learning among organizations.

What are the author’s argument / position?

The author explores some of the strategies that can be used of building successful learning organizations. He believes that organizations can be made better if the right approaches are adopted. Although he argues that the issue at hand is relatively transient, he is mainly out to demonstrate the steps which should be taken in organizational improvement programs. He posits that the whole process calls for commitment and carefulness. He takes the position of a problem solver who has mastered the challenges which face organizations. He argues that failure is likely to be inevitable if managers cling to grant philosophies and ignore the most practical ideas.

What three or four key points are made?

One of the major points made clear in the article is the definition of a learning organization. This has been done amidst lots of controversy. The reliability of the definition given in the article is therefore subject to scrutiny. A learning organization is explained as one which is equipped with the ability to create skills and transfer knowledge into actions of improvement. The other point which has been put across is the management of learning organizations. The third issue which comes out of the discussion is the process of monitoring learning in an organization. The three aspects have been put together to offer final solution towards strengthening the performance of organizations.

What 4- 5 questions does this article raise for our group?

The main activities of building an organization is one of the main questions raised in the article. Secondly, what are the strategic steps that can be taken in making decisions in a learning organization? Which is the best way to define an established learning organization? The issue of the nature of knowledge which needs to be kept in a learning organization has also surfaced in the article. The role of training in learning organizations is also an important question raised here.

Do these Questions relate to our work or personal lives?

The questions relate to both our work and personal lives. They seek to create a stable base for everyone in an organization to grow. Organizational growth is not achieved if all members fail to realize desirable changes in their lives. This entails behavioral modification which is usually inevitable. The answers to these questions call for change in the way managements in organizations undertake their roles.

How might this article useful for HR practitioners or Managers in thinking about organizational change?

The article gives managers and human resource practitioners the information they need. After understanding the nature of learning in their organizations, they will be able to formulate quality procedures of change. Training will be done on a basis of giving all employees skills which will help the organization at large. Since organizational change is associated with modification of human resources, it is easier to execute it in the case of a learning organization.

What other factors does Garvin believe are crucial for building a Learning Organization?

Garvin believes that successful programs are central in the process of building a learning organization. According to the author, it is important for organizations to emulate proven working principles from others. The latter is one way of making sure that organizations do not rely on inventing what may have complications. The author calls for an act of openness. This should be combined with transparency.

A learning organization is not a one man’s affair. It is a project to be run by the input of every department. In addition, attitude towards proven knowledge is a major determinant of the direction to be taken by an organization. Manager’s attitude towards learning is replicated in the whole organization. Garvin explains that knowledge transfer in an organization is necessary especially if prior planning and survey has been undertaken.

Comments on a difference between Senge (Senge, P. 1997 reading) and Garvin’s ideas about Learning Organizations

To begin with, Garvin’s idea revolves around exploring the impact of learning and management as pillars of building learning organizations. These are different from the ideas of Senge. The latter author presumes learning organizations as products of the choices made by leaders within the management team. He argues that managers of an organization take a pivotal role when it comes to the success of the organization.

The process of learning in building a learning organization is under the control of management. On the contrary, Garvin points out that in a learning organization, control of learning is a management function. Generally speaking, Senge views a learning organization as a product while Garvin’s idea is that the organization is a process. Garvin insists that an organization experiences processes which are geared towards making it better. These include constant informal and formal learning experiences. Informal learning occurs spontaneously while formal learning when is indeed structured and planned in advance.

While Senge focuses on explaining the positions taken by managers in creating learning organizations, Garvin gives steps to be followed when executing the process of learning in organizations. He gives the steps which are to be followed in building the organization. Senge notes that the success realized in a learning organization is a fruit of normal organizational development. He feels that organizations grow towards stability.

He depicts that learning takes place automatically as the organization pursues profitability. On the other hand, Garvin explains learning organizations as the final products of intentional and strategic actions. These include realizing the need for organizational learning. He views organizational change as one of the elements of organizational development. Senge argues that organizational design is attained as the system moves towards productivity. In addition, organizations are designed by the various resolutions adopted. Garvin illustrates the process of building and designing a learning organization.

Learning processes or practices in my work place – considering how they relate to Senge or on Garvin’s criteria for a Learning organization

In line with Senges’s criteria, learning how to operate in my organization was a strenuous task both to me and other leaders in my organization. I had to take an initiative to operate professionally in the organization. The managers in my department also noted that I needed to adapt to the new environment and hence, they were very helpful. Garvin points out the process of acquiring skills to be inevitable. As a result, I managed to attain new skills as time went by. Indeed, I kept on learning. This improved my performance on a daily basis.

After being accepted as one of the workers in the organization, I developed a great sense of belonging. This came with a feeling of acceptance. I understood that my presence was appreciated and was ready to exploit my potential for the benefit of the organization. There are times when work becomes extremely challenging. In most cases, this happens when I have tough decisions to make. I equally understand that it is my duty to seek assistance. Despite my efforts to remain focused on the delegated duties, I have never hesitated in coming up with new ways of making my job more interesting.

According to Garvin’s proposal, it is the duty of managers to anticipate such challenging moments so that they can come in and help subordinates to learn. The managerial team has a role of ensuring that knowledge is disseminated to everyone in the organization. This is meant to equip workers with the ability to be flexible at all times.

Informal and formal learning do take place in different aspects of my work. The social values in my organization have been integral in my working life. I have also developed a sense of enthusiasm which is highly advocated for in my organization. In line with Senge’s criteria, formal training sessions have been resourceful in relation to my technical skills.

Reading article by Argyris (1976)

It explores the function played by learning in the process of decision making. This has been done through the exposition of two types of learning. The article also elaborates two models of learning. These include double loop learning model and single loop learning model.

What are the Author’s argument / position?

The author seeks to demonstrate why feedback oriented learning is a crucial component in decision making for organizations. He demonstrates that effectiveness in decision making is achieved through learning processes since there are no absolute experts in that field. Although he leaves his data open for further research, the author of this article presents clear explanations. He takes the perspective of offering delivering inductive information. This has been achieved by adding extra information on models of learning.

Importance of learning, feedback and organized decision making as parts of achieving progress. In addition, learning should not be ignored in organizations.

Major questions for the group include the role of character in decision making, importance of incorporating acquired knowledge in decision making, and contributions of knowledge and the expected outcomes of balanced decision making. Decision making is portrayed as a crucial activity which cannot be done carelessly. On this note, my group benefits by evaluating the role played by knowledge. In this case, it is important to understand what is meant by knowledge. The type of knowledge that needs to be gathered and in what way it is to be applied. Decision making is inseparable with analysis of data. This calls for persons who have techniques of balancing different types of knowledge.

The questions relate to both work and personal lives of the members of any given organization. This is because decisions made both at workplace and other social settings have long term impacts. It is true that the ability to learn is closely linked with the attitude of the learner. In relation to this, learning occurs both intentionally and intentionally. The article illustrates the need for persons in any given managerial positions to be equipped with the right knowledge. If such leaders do not have appropriate skills to use in managing others, then it is perpetually impossible to achieve desired results. This aspect is evident in all areas of a worker’s life since decisions are made in every step an employee makes in his or her duties.

How might this article be useful for HR practitioners or Managers in thinking about organizational change?

It may assist them in getting understanding that learning occurs in any given set of conditions. They should be able to understand that extreme crises are not causes of faulty decisions. Compromised decision making is a result of manager’s inability to learn. Human resource practitioners and managers ought to understand the details of any problematic occurrence in organizations.

They should be able to analyze the factors behind instabilities. Besides, managers should make sure that they investigate all external and internal factors which have perpetrated activities in the organization. Due to the application of guidelines shown in the paper, managers are put in a position to evaluate the challenges facing an organization. These challenges may entail motives, intentions and even diverse desires of different workers.

From Argyris (1976) reading- What are single-loop and double loop learning?

Double loop learning involves seeking solutions to problems and all the underlying factors which propagate occurrence of the problematic issue. It also entails the functions of willingness, management of self and self awareness. This kind of learning also monitors occurrence of daily challenges.

Single loop learning is defined as the activity of adopting corrective measures which solve past errors while avoiding repetition of the same mistakes. It has a foundation of examining the technical aspect of mistakes. This makes it easy to investigate external factors which may culminate into the occurrence of a problem.

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Sophia Edelstein is the cofounder and co-chief executive officer of Pair Eyewear .

In today's rapidly evolving digital landscape, the imperative for organizations to cultivate a data-driven culture has never been more pronounced. Many CEOs and organizations talk about having a data-driven culture, but the specific semantics behind being “data-driven” often remain elusive.

Figuring out how data can tie into your business and your mission is a fundamental question founders and their teams should explore at all stages of building their business. According to a recent McKinsey study, “Companies that are using data-driven B2B sales-growth engines report above-market growth and EBITDA increases in the range of 15 to 25 percent.”

While being data-driven is obviously good for business, it is nearly impossible to build a data-driven culture overnight. There are key ways, however, that your team can point themselves in the right direction.

A data-driven culture starts at the top.

I've found that in order to truly create a data-driven culture, it has to come from the top down. As leaders embrace data as a cornerstone of decision-making and organizational strategy, they set a powerful precedent, signaling to employees the fundamental importance of data-driven insights in driving success.

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The leaders of the company need to be making data-centric decisions firsthand. While experience and intuition undoubtedly play a role for any CEO, when team members observe that decisions at the highest levels of the company are primarily informed by data, it fosters a culture that encourages a data-driven mindset across all departments.

Leaders who exemplify a “testing and iterating ” mindset could also spark a wider set of values organizationally, drive incremental improvements and catalyze a cultural shift toward continuous learning and innovation, positioning your company for sustained success in an ever-evolving data-centric landscape.

I recommend CEOs and executive teams also set a framework to track KPIs consistently on a daily, monthly and yearly basis, ensuring the broader organization is maintaining goals. A forward thinking data-driven culture should seamlessly align a focus on OKRs and KPIs within each department or team. This integration should help to drive performance through measurable objectives and foster a culture of accountability across the organization.

Recent data from the NIH affirms that curiosity is infectious , and I've found this to be particularly true within the workplace. Bearing this in mind, CEOs who exhibit a keen sense of curiosity and prioritize testing and learning not only set a precedent but also inspire their teams to adopt similar approaches. While it's not about exclusively relying on data for every decision, consistently showcasing a commitment to data-driven practices sends a powerful message to the team.

Moreover, simple yet intentional actions, such as emphasizing the significance of data-centric decisions during meetings and private discussions, as well as celebrating team successes stemming from this mindset, can result in a positive ripple effect.

Tailor your data infrastructure to your organization’s specific needs.

Another integral part of establishing a data-driven culture is to make sure your team has a strong data infrastructure in place to begin with. Essentially, what that means is that your company should have resources accessible to build the backbone of a centralized data source for all of the data of your company. Organizations can adopt different data strategies based on their needs, and these typically can be centralized, decentralized or hybrid. To hone in on the data infrastructure that's best for your organization, assess your organization’s specific and individual needs.

At Pair Eyewear, we chose to organize all of our data—from marketing data to customer experience data—using an infrastructure where all of these different data sources can come together into a single platform. Some of the questions we asked when picking our data technology partners were based on the ability to integrate the necessary sources and how the infrastructure could scale as our company and our needs grew over time.

When picking which third-party business intelligence (BI) tools your team will use, look at individual features and weigh what is most critical to your team. For example, triage the importance of things like deep-customization, user-friendliness or tools that have powerful data visualization. Some of the most popular business intelligence (BI) tools available on the market include Tableau and Looker (which my company uses).

Empower your internal data team.

An internal data team is crucial to the success of your company's data-driven culture. They manage everything from data analytics to user research. For data-centric cultures, this is really important because user research can be used with everything from testing out new UI on your company’s site to interviewing customers before expanding into a new region or territory.

A solid data team isn't just responsible for creating and maintaining the infrastructure and running analysis but also for educating fellow employees on the resources and tools they need to be data-focused. This can be especially important in helping to constantly source and provide materials for new individuals who join an organization who might not otherwise have a data-focused background.

In order to have your data team also spark data literacy for all members, they can run internal “clinics” or “office hours.” There are no fast and hard rules on the cadence to which organizations should do this, but I recommend you establish open channels of communication—both digitally and in person—for maintaining a data-rich culture.

Tap into the potential of data.

A recent survey conducted by the Harvard Business Review for Google Cloud, with more than 360 executives, revealed that “data and AI leaders outperformed their peers across a range of key business metrics, such as operational efficiency (81% vs. 58%), revenues (77% vs. 61%), customer loyalty and retention (77% vs. 45%), employee satisfaction (68% vs. 39%), and IT cost predictability (59% vs. 44%). ”

As the volume and complexity of data continue to evolve rapidly, it is crucial for CEOs and founders to empower their teams to tap into the unlimited potential of data as a key asset. Building a rich data-centric culture means more than just making more informed decisions: It is about refining your company's mission and values and encouraging open communication and innovative thinking.

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NPR suspends veteran editor as it grapples with his public criticism

David Folkenflik

NPR suspended senior editor Uri Berliner for five days without pay after he wrote an essay accusing the network of losing the public's trust and appeared on a podcast to explain his argument. Uri Berliner hide caption

NPR suspended senior editor Uri Berliner for five days without pay after he wrote an essay accusing the network of losing the public's trust and appeared on a podcast to explain his argument.

NPR has formally punished Uri Berliner, the senior editor who publicly argued a week ago that the network had "lost America's trust" by approaching news stories with a rigidly progressive mindset.

Berliner's five-day suspension without pay, which began last Friday, has not been previously reported.

Yet the public radio network is grappling in other ways with the fallout from Berliner's essay for the online news site The Free Press . It angered many of his colleagues, led NPR leaders to announce monthly internal reviews of the network's coverage, and gave fresh ammunition to conservative and partisan Republican critics of NPR, including former President Donald Trump.

Conservative activist Christopher Rufo is among those now targeting NPR's new chief executive, Katherine Maher, for messages she posted to social media years before joining the network. Among others, those posts include a 2020 tweet that called Trump racist and another that appeared to minimize rioting during social justice protests that year. Maher took the job at NPR last month — her first at a news organization .

In a statement Monday about the messages she had posted, Maher praised the integrity of NPR's journalists and underscored the independence of their reporting.

"In America everyone is entitled to free speech as a private citizen," she said. "What matters is NPR's work and my commitment as its CEO: public service, editorial independence, and the mission to serve all of the American public. NPR is independent, beholden to no party, and without commercial interests."

The network noted that "the CEO is not involved in editorial decisions."

In an interview with me later on Monday, Berliner said the social media posts demonstrated Maher was all but incapable of being the person best poised to direct the organization.

"We're looking for a leader right now who's going to be unifying and bring more people into the tent and have a broader perspective on, sort of, what America is all about," Berliner said. "And this seems to be the opposite of that."

Conservative critics of NPR are now targeting its new chief executive, Katherine Maher, for messages she posted to social media years before joining the public radio network last month. Stephen Voss/Stephen Voss hide caption

Conservative critics of NPR are now targeting its new chief executive, Katherine Maher, for messages she posted to social media years before joining the public radio network last month.

He said that he tried repeatedly to make his concerns over NPR's coverage known to news leaders and to Maher's predecessor as chief executive before publishing his essay.

Berliner has singled out coverage of several issues dominating the 2020s for criticism, including trans rights, the Israel-Hamas war and COVID. Berliner says he sees the same problems at other news organizations, but argues NPR, as a mission-driven institution, has a greater obligation to fairness.

"I love NPR and feel it's a national trust," Berliner says. "We have great journalists here. If they shed their opinions and did the great journalism they're capable of, this would be a much more interesting and fulfilling organization for our listeners."

A "final warning"

The circumstances surrounding the interview were singular.

Berliner provided me with a copy of the formal rebuke to review. NPR did not confirm or comment upon his suspension for this article.

In presenting Berliner's suspension Thursday afternoon, the organization told the editor he had failed to secure its approval for outside work for other news outlets, as is required of NPR journalists. It called the letter a "final warning," saying Berliner would be fired if he violated NPR's policy again. Berliner is a dues-paying member of NPR's newsroom union but says he is not appealing the punishment.

The Free Press is a site that has become a haven for journalists who believe that mainstream media outlets have become too liberal. In addition to his essay, Berliner appeared in an episode of its podcast Honestly with Bari Weiss.

A few hours after the essay appeared online, NPR chief business editor Pallavi Gogoi reminded Berliner of the requirement that he secure approval before appearing in outside press, according to a copy of the note provided by Berliner.

In its formal rebuke, NPR did not cite Berliner's appearance on Chris Cuomo's NewsNation program last Tuesday night, for which NPR gave him the green light. (NPR's chief communications officer told Berliner to focus on his own experience and not share proprietary information.) The NPR letter also did not cite his remarks to The New York Times , which ran its article mid-afternoon Thursday, shortly before the reprimand was sent. Berliner says he did not seek approval before talking with the Times .

NPR defends its journalism after senior editor says it has lost the public's trust

Berliner says he did not get permission from NPR to speak with me for this story but that he was not worried about the consequences: "Talking to an NPR journalist and being fired for that would be extraordinary, I think."

Berliner is a member of NPR's business desk, as am I, and he has helped to edit many of my stories. He had no involvement in the preparation of this article and did not see it before it was posted publicly.

In rebuking Berliner, NPR said he had also publicly released proprietary information about audience demographics, which it considers confidential. He said those figures "were essentially marketing material. If they had been really good, they probably would have distributed them and sent them out to the world."

Feelings of anger and betrayal inside the newsroom

His essay and subsequent public remarks stirred deep anger and dismay within NPR. Colleagues contend Berliner cherry-picked examples to fit his arguments and challenge the accuracy of his accounts. They also note he did not seek comment from the journalists involved in the work he cited.

Morning Edition host Michel Martin told me some colleagues at the network share Berliner's concerns that coverage is frequently presented through an ideological or idealistic prism that can alienate listeners.

"The way to address that is through training and mentorship," says Martin, herself a veteran of nearly two decades at the network who has also reported for The Wall Street Journal and ABC News. "It's not by blowing the place up, by trashing your colleagues, in full view of people who don't really care about it anyway."

Several NPR journalists told me they are no longer willing to work with Berliner as they no longer have confidence that he will keep private their internal musings about stories as they work through coverage.

"Newsrooms run on trust," NPR political correspondent Danielle Kurtzleben tweeted last week, without mentioning Berliner by name. "If you violate everyone's trust by going to another outlet and sh--ing on your colleagues (while doing a bad job journalistically, for that matter), I don't know how you do your job now."

Berliner rejected that critique, saying nothing in his essay or subsequent remarks betrayed private observations or arguments about coverage.

Other newsrooms are also grappling with questions over news judgment and confidentiality. On Monday, New York Times Executive Editor Joseph Kahn announced to his staff that the newspaper's inquiry into who leaked internal dissent over a planned episode of its podcast The Daily to another news outlet proved inconclusive. The episode was to focus on a December report on the use of sexual assault as part of the Hamas attack on Israel in October. Audio staffers aired doubts over how well the reporting stood up to scrutiny.

"We work together with trust and collegiality everyday on everything we produce, and I have every expectation that this incident will prove to be a singular exception to an important rule," Kahn wrote to Times staffers.

At NPR, some of Berliner's colleagues have weighed in online against his claim that the network has focused on diversifying its workforce without a concomitant commitment to diversity of viewpoint. Recently retired Chief Executive John Lansing has referred to this pursuit of diversity within NPR's workforce as its " North Star ," a moral imperative and chief business strategy.

In his essay, Berliner tagged the strategy as a failure, citing the drop in NPR's broadcast audiences and its struggle to attract more Black and Latino listeners in particular.

"During most of my tenure here, an open-minded, curious culture prevailed. We were nerdy, but not knee-jerk, activist, or scolding," Berliner writes. "In recent years, however, that has changed."

Berliner writes, "For NPR, which purports to consider all things, it's devastating both for its journalism and its business model."

NPR investigative reporter Chiara Eisner wrote in a comment for this story: "Minorities do not all think the same and do not report the same. Good reporters and editors should know that by now. It's embarrassing to me as a reporter at NPR that a senior editor here missed that point in 2024."

Some colleagues drafted a letter to Maher and NPR's chief news executive, Edith Chapin, seeking greater clarity on NPR's standards for its coverage and the behavior of its journalists — clearly pointed at Berliner.

A plan for "healthy discussion"

On Friday, CEO Maher stood up for the network's mission and the journalism, taking issue with Berliner's critique, though never mentioning him by name. Among her chief issues, she said Berliner's essay offered "a criticism of our people on the basis of who we are."

Berliner took great exception to that, saying she had denigrated him. He said that he supported diversifying NPR's workforce to look more like the U.S. population at large. She did not address that in a subsequent private exchange he shared with me for this story. (An NPR spokesperson declined further comment.)

Late Monday afternoon, Chapin announced to the newsroom that Executive Editor Eva Rodriguez would lead monthly meetings to review coverage.

"Among the questions we'll ask of ourselves each month: Did we capture the diversity of this country — racial, ethnic, religious, economic, political geographic, etc — in all of its complexity and in a way that helped listeners and readers recognize themselves and their communities?" Chapin wrote in the memo. "Did we offer coverage that helped them understand — even if just a bit better — those neighbors with whom they share little in common?"

Berliner said he welcomed the announcement but would withhold judgment until those meetings played out.

In a text for this story, Chapin said such sessions had been discussed since Lansing unified the news and programming divisions under her acting leadership last year.

"Now seemed [the] time to deliver if we were going to do it," Chapin said. "Healthy discussion is something we need more of."

Disclosure: This story was reported and written by NPR Media Correspondent David Folkenflik and edited by Deputy Business Editor Emily Kopp and Managing Editor Gerry Holmes. Under NPR's protocol for reporting on itself, no NPR corporate official or news executive reviewed this story before it was posted publicly.

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Democracy Dies Behind Paywalls

The case for making journalism free—at least during the 2024 election

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Produced by ElevenLabs and News Over Audio (NOA) using AI narration.

How many times has it happened? You’re on your computer, searching for a particular article, a hard-to-find fact, or a story you vaguely remember, and just when you seem to have discovered the exact right thing, a paywall descends. “$1 for Six Months.” “Save 40% on Year 1.” “Here’s Your Premium Digital Offer.” “Already a subscriber?” Hmm, no.

Now you’re faced with that old dilemma: to pay or not to pay. (Yes, you may face this very dilemma reading this story in The Atlantic .) And it’s not even that simple. It’s a monthly or yearly subscription—“Cancel at any time.” Is this article or story or fact important enough for you to pay?

Or do you tell yourself—as the overwhelming number of people do—that you’ll just keep searching and see if you can find it somewhere else for free?

According to the Reuters Institute for the Study of Journalism, more than 75 percent of America’s leading newspapers, magazines, and journals are behind online paywalls. And how do American news consumers react to that? Almost 80 percent of Americans steer around those paywalls and seek out a free option.

Paywalls create a two-tiered system: credible, fact-based information for people who are willing to pay for it, and murkier, less-reliable information for everyone else. Simply put, paywalls get in the way of informing the public, which is the mission of journalism. And they get in the way of the public being informed, which is the foundation  of democracy. It is a terrible time for the press to be failing at reaching people, during an election in which democracy is on the line. There’s a simple, temporary solution: Publications should suspend their paywalls for all 2024 election coverage and all information that is beneficial to voters. Democracy does not die in darkness—it dies behind paywalls.

The problem is not just that professionally produced news is behind a wall; the problem is that paywalls increase the proportion of free and easily available stories that are actually filled with misinformation and disinformation. Way back in 1995 (think America Online), the UCLA professor Eugene Volokh predicted that the rise of “cheap speech”—free internet content—would not only democratize mass media by allowing new voices, but also increase the proliferation of misinformation and conspiracy theories, which would then destabilize mass media.

Paul Barrett, the deputy director of the NYU Stern Center for Business and Human Rights and one of the premier scholars on mis- and disinformation, told me he knows of no research on the relationship between paywalls and misinformation. “But it stands to reason,” he said, “that if people seeking news are blocked by the paywalls that are increasingly common on serious professional journalism websites, many of those people are going to turn to less reliable sites where they’re more likely to encounter mis- and disinformation.”

In the pre-internet days, information wasn’t free—it just felt that way. Newsstands were everywhere, and you could buy a paper for a quarter. But that paper wasn’t just for you: After you read it at the coffee shop or on the train, you left it there for the next guy. The same was true for magazines. When I was the editor of Time , the publisher estimated that the “pass-along rate” of every issue was 10 to 15—that is, each magazine we sent out was read not only by the subscriber, but by 10 to 15 other people. In 1992, daily newspapers claimed a combined circulation of some 60 million; by 2022, while the nation had grown, that figure had fallen to 21 million. People want information to be free—and instantly available on their phone.

Barrett is aware that news organizations need revenue, and that almost a third of all U.S. newspapers have stopped publishing over the previous two decades. “It’s understandable that traditional news-gathering businesses are desperate for subscription revenue,” he told me, “but they may be inadvertently boosting the fortunes of fake news operations motivated by an appetite for clicks or an ideological agenda—or a combination of the two.”

Digital-news consumers can be divided into three categories: a small, elite group that pays hundreds to thousands of dollars a year for high-end subscriptions; a slightly larger group of people with one to three news subscriptions; and the roughly 80 percent of Americans who will not or cannot pay for information. Some significant percentage of this latter category are what scholars call “passive” news consumers—people who do not seek out information, but wait for it to come to them, whether from their social feeds, from friends, or from a TV in an airport. Putting reliable information behind paywalls increases the likelihood that passive news consumers will receive bad information.

In the short history of social media, the paywall was an early hurdle to getting good information; now there are newer and more perilous problems. The Wall Street Journal instituted a “hard paywall” in 1996. The Financial Times formally launched one in 2002. Other publications experimented with them, including The New York Times , which established its subscription plan and paywall in 2011. In 2000, I was the editor of Time.com, Time magazine’s website, when these experiments were going on. The axiom then was that “must have” publications like The Wall Street Journal could get away with charging for content, while “nice to have” publications like Time could not. Journalists were told that “information wants to be free.” But the truth was simpler: People wanted free information, and we gave it to them. And they got used to it.

Of course, publications need to cover their costs, and journalists need to be paid. Traditionally, publications had three lines of revenue: subscriptions, advertising, and newsstand sales. Newsstand sales have mostly disappeared. The internet should have been a virtual newsstand, but buying individual issues or articles is almost impossible. The failure to institute a frictionless mechanism for micropayments to purchase news was one of the greatest missteps in the early days of the web. Some publications would still be smart to try it.

I’d argue that paywalls are part of the reason Americans’ trust in media is at an all-time low. Less than a third of Americans in a recent Gallup poll say they have “a fair amount” or a “a great deal” of trust that the news is fair and accurate. A large percentage of these Americans see media as being biased. Well, part of the reason they think media are biased is that most fair, accurate, and unbiased news sits behind a wall. The free stuff needn’t be fair or accurate or unbiased. Disinformationists, conspiracy theorists, and Russian and Chinese troll farms don’t employ fact-checkers and libel lawyers and copy editors.

Part of the problem with the current, free news environment is that the platform companies, which are the largest distributors of free news, have deprioritized news. Meta has long had an uncomfortable relationship with news on Facebook. In the past year, according to CNN, Meta has changed its algorithm in a way that has cost some news outlets 30 to 40 percent of their traffic (and others more). Threads, Meta’s answer to X, is “not going to do anything to encourage” news and politics on the platform, says Adam Mosseri, the executive who oversees it. “My take is, from a platforms’ perspective, any incremental engagement or revenue [news] might drive is not at all worth the scrutiny, negativity (let’s be honest), or integrity risks that come along with them.” The platform companies are not in the news business; they are in the engagement business. News is less engaging than, say, dance shorts or chocolate-chip-cookie recipes—or eye-catching conspiracy theories.

As the platforms have diminished news, they have also weakened their integrity and content-moderation teams, which enforce community standards or terms of service. No major platform permits false advertising, child pornography, hate speech, or speech that leads to violence; the integrity and moderation teams take down such content. A recent paper from Barrett’s team at the NYU Stern Center for Business and Human Rights argues that the greatest tech-related threat in 2024 is not artificial intelligence or foreign election interference, but something more mundane: the retreat from content moderation and the hollowing-out of trust-and-safety units and election-integrity teams. The increase in bad information on the free web puts an even greater burden on fact-based news reporting.

Now AI-created clickbait is also a growing threat. Generative AI’s ability to model, scrape, and even plagiarize real news—and then tailor it to users—is extraordinary. AI clickbait mills, posing as legitimate journalistic organizations, are churning out content that rips off real news and reporting. These plagiarism mills are receiving funding because, well, they’re cheap and profitable. For now, Google’s rankings don’t appear to make a distinction between a news article written by a human being and one written by an AI chatbot. They can, and they should.

The best way to address these challenges is for newsrooms to remove or suspend their paywalls for stories related to the 2024 election. I am mindful of the irony of putting this plea behind The Atlantic ’s own paywall, but that’s exactly where the argument should be made. If you’re reading this, you’ve probably paid to support journalism that you think matters in the world. Don’t you want it to be available to others, too, especially those who would not otherwise get to see it?

Emergencies and natural disasters have long prompted papers to suspend their paywalls. When Hurricane Irene hit the New York metropolitan area in 2011, The New York Times made all storm-related coverage freely available. “We are aware of our obligations to our audience and to the public at large when there is a big story that directly impacts such a large portion of people,” a New York Times editor said at the time. In some ways, this creates a philosophical inconsistency. The paywall says, This content is valuable and you have to pay for it . Suspending the paywall in a crisis says, This content is so valuable that you don’t have to pay for it . Similarly, when the coronavirus hit, The Atlantic made its COVID coverage—and its COVID Tracking Project—freely available to all.

During the pandemic, some publications found that suspending their paywall had an effect they had not anticipated: It increased subscriptions. The Seattle Times , the paper of record in a city that was an early epicenter of coronavirus, put all of its COVID-related content outside the paywall and then saw, according to its senior vice president of marketing, Kati Erwert, “a very significant increase in digital subscriptions”—two to three times its previous daily averages. The Philadelphia Inquirer put its COVID content outside its paywall in the spring of 2020 as a public service. And then, according to the paper’s director of special projects, Evan Benn, it saw a “higher than usual number of digital subscription sign-ups.”

The Tampa Bay Times , The Denver Post , and The St. Paul Pioneer Press , in Minnesota, all experienced similar increases, as did papers operated by the Tribune Publishing Company, including the Chicago Tribune and the Hartford Courant . The new subscribers were readers who appreciated the content and the reporting and wanted to support the paper’s efforts, and to make the coverage free for others to read, too.

Good journalism isn’t cheap, but outlets can find creative ways to pay for their reporting on the election. They can enlist foundations or other sponsors to underwrite their work. They can turn to readers who are willing to subscribe, renew their subscriptions, or make added donations to subsidize important coverage during a crucial election. And they can take advantage of the broader audience that unpaywalled stories can reach, using it to generate more advertising revenue—and even more civic-minded subscribers.

The reason papers suspend their paywall in times of crisis is because they understand that the basic and primary mission of the press is to inform and educate the public. This idea goes back to the country’s Founders. The press was protected by the First Amendment so it could provide the information that voters need in a democracy. “Our liberty depends on the freedom of the press,” Thomas Jefferson wrote, “and that cannot be limited without being lost.” Every journalist understands this. There is no story with a larger impact than an election in which the survival of democracy is on the ballot.

I believe it was a mistake to give away journalism for free in the 1990s. Information is not and never has been free. I devoutly believe that news organizations need to survive and figure out a revenue model that allows them to do so. But the most important mission of a news organization is to provide the public with information that allows citizens to make the best decisions in a constitutional democracy. Our government derives its legitimacy from the consent of the governed, and that consent is arrived at through the free flow of information—reliable, fact-based information. To that end, news organizations should put their election content in front of their paywall. The Constitution protects the press so that the press can protect constitutional democracy. Now the press must fulfill its end of the bargain.