Part 4 - Organizationa L Constraints The Organization Itself Constrains

Part 4 Organizationa l Constraints The organization itself constrains
decision makers. They shape theirdecisions to reflect the organizations performance
evaluation andreward system and organizational ly imposed time constraints.Pr
evious organizational decisions also act as precedents to constraincurre nt decisions.
Performance Evaluation Decision maker are strongly influenced in their decision
making bythe criteria by which they are evaluated.[If a division manager
believes that the manufacturin g plants underhis responsibility are operating
best when he hears nothingnegati ve, we shouldnt be surprised to find that his
plant managersspen d a good part of their time ensuring that negative informationdo
esnt reach the division boss.][If a college dean believes that an instructor should never
fail morethan 10 percent of her students to fail more reflects on theinstructors ability to
teach we should expect that new instructor,wh o want to receive favorable
evaluations, will decide not to fail toomany students.] Reward System
What choices are preferable in terms of personal payoff?If the organization rewards risk
aversion, managers are likely tomake conservative decisions.[Ge neral Motors consistently
gave out promotions and bonuses tomanager who kept a low profile, avoided
controversy, and weregood team players. The result was that GM managers became
veryadept at dodging tough issues and passing controversial decisionson to committees]
SystemImposed Time Constraints Organizations impose deadlines on
decisions.A host of decisions have to be made quickly in order to stay aheadof
the competition and keep customers be made quickly in orders tostay ahead
of the competition and keep customers satisfied.
And almost all important decisions
come with explicit deadlines. Th ese conditions create time pressures on decision
makers andoften make it difficult, if not impossible, to gather all the
informationth ey might like before having to make a final choice. The rationalmodel
ignores the reality that, in organizations decision come withtime constraints
Historical Precedents Rational decision making takes an unrealistic and
insulatedpersp ective. It views decision as independent and discrete events.But
that isnt they way it I in the real world! Decisions arent madein a vacuum. They have a
context. In fact, individual decisions aremore accurately characterized
as points in a stream of decisions.Dec isions made in the past are ghost that continually
haunt currentchoice s.Its common knowledge that the largest determining
factor of thesize of any given years budget is last years budget.Choice s made today,
therefore, are largely a result of choices madeover the years. Cultural Differences
The rational model does not acknowledge cultural differences. But,we need
to recognize that the cultural background of the decisionmake r can have
significant influence on his or her selection of problems, depth of analysis, the
importance placed on logic andrationality , or whether organizational decisions
should be madeautocrati cally by an individual manger or collectively in groups.
(Like Japan Manager is more grouporiented. Before making an importantdeci
sion, they collect a large amount of information, which is thenused in consensus-
forming group decisions.)So me cultures emphasize solving problems;
others focus onaccepting situations as they are. Problemsolving decision
makerbelieve that they can and should change situations to their benefit.
Part 5 Ethics in
Decision MakingUtilita rian criterion Decisions are made solely on the basis of their
outcomes orconsequenc es. The goal of it is to provide the greatest good for the
greatestnumbe r. This view tends to dominate business decision making.(Effic
iency, productivity, and high profits)[+ A focus on utilitarianism promotes
efficiency and productivity.Ignoring he rights of some individuals particularly those
withminority representation in the organization.] Right criterion
This call on individuals to make decisions consistent withfundamen tal liberties
and privileges as set forth in documents suchas the Bill of Right.An emphasis on
rights in decision making means respecting andprotecting the basic rights of
individuals.(T he right to privacy, tofree speech, and to due process)[+ Protects
individuals from injury and is consistent with freedomand privacy-
Create an overly legalistic workplace that hinders productivity
andefficiency. ] Justice criterion This requires individual to impose and
enforce rules fairly andimpartiall y so there is an equitable distribution of benefits and
costs.[+ The interests of the underrepresen ted and less powerfulEncourage a
sense of entitlement that reduces risk taking,innovat ion, and productivity.

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Part 4 Organizationa l Constraints The organization itself constrains

decision makers. They shape theirdecisions to reflect the organizations performance

evaluation andreward system and organizational ly imposed time constraints.Pr

evious organizational decisions also act as precedents to constraincurre nt decisions.

Performance Evaluation Decision maker are strongly influenced in their decision

making bythe criteria by which they are evaluated.[If a division manager

believes that the manufacturin g plants underhis responsibility are operating

teach we should expect that new instructor,wh o want to receive favorable

evaluations, will decide not to fail toomany students.] Reward System

veryadept at dodging tough issues and passing controversial decisionson to committees]

SystemImposed Time Constraints Organizations impose deadlines on

decisions.A host of decisions have to be made quickly in order to stay aheadof

of the competition and keep customers satisfied.

And almost all important decisions

makers andoften make it difficult, if not impossible, to gather all the

ignores the reality that, in organizations decision come withtime constraints

Historical Precedents Rational decision making takes an unrealistic and

insulatedpersp ective. It views decision as independent and discrete events.But

context. In fact, individual decisions aremore accurately characterized

haunt currentchoice s.Its common knowledge that the largest determining

to recognize that the cultural background of the decisionmake r can have

significant influence on his or her selection of problems, depth of analysis, the

importance placed on logic andrationality , or whether organizational decisions

should be madeautocrati cally by an individual manger or collectively in groups.

(Like Japan Manager is more grouporiented. Before making an importantdeci

sion, they collect a large amount of information, which is thenused in consensus-

forming group decisions.)So me cultures emphasize solving problems;

others focus onaccepting situations as they are. Problemsolving decision

greatestnumbe r. This view tends to dominate business decision making.(Effic

iency, productivity, and high profits)[+ A focus on utilitarianism promotes

efficiency and productivity.Ignoring he rights of some individuals particularly those

withminority representation in the organization.] Right criterion

This call on individuals to make decisions consistent withfundamen tal liberties

rights in decision making means respecting andprotecting the basic rights of

individuals.(T he right to privacy, tofree speech, and to due process)[+ Protects

individuals from injury and is consistent with freedomand privacy-

Create an overly legalistic workplace that hinders productivity

andefficiency. ] Justice criterion This requires individual to impose and

enforce rules fairly andimpartiall y so there is an equitable distribution of benefits and

costs.[+ The interests of the underrepresen ted and less powerfulEncourage a

sense of entitlement that reduces risk taking,innovat ion, and productivity.

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