Models used in Decision Making

Models used in Decision Making
Models used in Decision Making

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Models used in Decision Making

Introduction

This paper intends to examine models used in decision making. Models of decision making are terms used to refer to processes employed when formulating conclusions about decisions that an organization should follow through and the available alternatives to decisions. To achieve examination, the paper will look at organizational structures, which are viewed as vibrant.

Models used in decision-making

There are a number of models used in decision making within different organizations. However, this paper will focus on two models. Furthermore, the spotlight will be on the ability of two models in supporting the needs of IT in a business. The first model is rational-actor model, while the second model is organizational-process model. A rational-actor model is used when explaining decisions taken by large organizations which are centrally controlled (Kuwashima, 2014). The assumption of the model is that there is rationality in the business institution being considered (Courtney, 2013). Moreover, the model is used to show consistency within an organization and value maximization of specific constraints.

Therefore, the model shows how an organization makes rational choices. On the other hand, organizational-process model is used in examining the activities carried out by all departments of an organization. Moreover, organization-process model considers all activities an organization is involved in, as output from combined subsystems (Kuwashima, 2014). In a business there is a number of IT needs to be met.  Among the needs are email communication, software for accounting, storage of files, a system for telephone communication, a reliable internet connection, as well as, a system to be used by the support team.

Consequently, a rational-actor model may not efficiently support the needs of IT in a business. Notably, rational-actor model views actions taken by an organization, as influenced by choices made by a universal rational maker of decisions (Kuwashima, 2014). The assumption by rational-actor model fails to consider that, organizations are always made of subsystems which are loosely connected. In addition, all subsystems within an organization act independently.

However, an organizational-process model may competently support the needs of IT in a business. Notably, an organizational-process model considers operations which are routinely carried out within subsystems of an organization (Kuwashima, 2014). Moreover, organizational-process model looks at the interaction between all subsystems of an organization. An organizational-process model is, therefore, more capable of making appropriate decisions on the needs of IT in a business, compared to rational-actor model (Boulesnane, & Bouzidi, 2013).

Hire-Jordan-Smith model for making decisions

I work for an organization known as Hire-Jordan Smith. At Hire-Jordan-Smith the model of making decisions used is an organizational process. The process is initiated by, the use of strategic management. Every level of organization of Hire-Jordan-Smith has a separate operations system, which is aimed at enhancing the integrity and improving communication. All operations systems have their assigned goals, which are used in the evaluation of performance (Boulesnane, & Bouzidi, 2013). At all operations systems within Hire-Jordan-Smith are managers along with supervisors. Using trust and integrity managers along with supervisors make crucial decisions within their assigned operations systems. One of the operation systems of Hire-Jordan-Smith is IT (Huang & Hutchinson, 2013).

Hire-Jordan-Smith supports its needs for business by having managers along with supervisors being responsible for differentiated operations systems in different ways.  First, there is efficiency in system functionality. Communication flows well while all systems are able to integrate. Secondly, knowledge processes can be traced. Division of work enables employees to specialize and gain experience hence becomes more productive (Boulesnane, & Bouzidi, 2013).

Thirdly, there is more satisfaction of stakeholders such as suppliers of Hire-Jordan-Smith products, customers, as well as, employees and team of management. Fourth, the cost incurred by Hire-Jordan-Smith is lower. The cost that would be expected to be incurred to train employees to work in all systems is reduced with specialization.

Moreover, Hire-Jordan-Smith gets a competitive advantage globally from the use of separate operations system. First, there is efficiency in the management of relationships held with customers. It is easier for Hire-Jordan-Smith to understand its customers’ behavior. Secondly, the chain of supply of Hire-Jordan-Smith is proficiently managed. Thirdly, Hire-Jordan-Smith keeps a portal system which helps in educating and communicating with employees and customers. Fourth, due to the sufficiency of information from both customers of Hire-Jordan-Smith and its employees, it becomes easy for the management team in collaboration with supervisors to make reliable and productive decisions.

Theories of organizational structures

There are a number of theories developed for vibrant organizational structures. Two among the theories are systems theory and contingency theory (Sun, & Jeyaraj, 2013). For most IT organizations, systems theory is used to describe how various parts or divisions within an organization are interrelated.  However, systems theory is also used to manage any form of change experienced by the organization (Cricelli, Grimaldi, & Hanandi, 2014).

In systems theory, any change experienced by one department of the organization leads to changes within other departments of the organization. Notably, different systems of IT organizations are not sometimes linearly integrated. Therefore, if one part experiences a small change, then another part may be affected by large changes (Cricelli, Grimaldi, & Hanandi, 2014). In most cases, IT organizations experience changes in equilibrium due to the adaptation of the organizations to changes in the environment.

On the other hand, IT organizations may choose to employ contingency theory to manage changes within the organization. Contingency theory mainly addresses effective management of conflicts experienced by an organization (Conaldi, Lomi, & Tonellato, 2012). Through the use of software, organizations are able to address issues raised by changes from the environment. Effective adaptation and change depend on management’s team ability to come up with contingent decisions when the organization is facing changes.

Vibrant Organizational structure of Hire-Jordan Smith

At Hire-Jordan-Smith, the structure of the organization is divided into eight parts. The first division is the general manager. Parts two and three are the first project manager, along with, the second project manager (Boulesnane, & Bouzidi, 2013). Part four refers to research and development team. Part five refers to the quality control team. Part six, on the other hand, is made up of the engineering team.

Part seven refers to the analysis team. The last part refers to the marketing team. Integration and cooperation of the eight teams lead to constant growth and profit generation of Hire-Jordan Smith. In a situation where changes are experienced in technology, two project managers are responsible for initiating projects to be used in developing up to date technology within Hire-Jordan Smith.

The general manager is responsible for approving any projects presented by either of the two project managers. The research and development team is mandated with carrying out informed and updated research on how to improve the existing technology of Hire-Jordan Smith. The quality control team checks whether the product presented for sale by the research team meets all the standards of Hire-Jordan Smith. After approval by the quality control team, the engineering team starts developing the proposed product (Boulesnane, & Bouzidi, 2013).

The analysis team then examines the product presented to them by the engineering team after development. One’s the product is analyzed fully, the marketing team introduces the product in the market, and pushes its sales through different methods of advertising.

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Connection between Models used in decision making and Vibrant Organizational structures

Models used in decision making have a close relationship with vibrant organizational structures. For instance, the organizational-process model is employed in investigating actions taken by the entire organization (van der Meer, Kurth-Nelson, & Redish, 2012). On the other hand, vibrant organizational structures are divided into different parts all aimed at achieving the same goal (Huang & Hutchinson, 2013). All parts, however, are given different roles. Notably, changes in an organization influence, the choice made for a model to be used in decision-making.

For instance, changes in the type of technology used in an organization may result in a change of choice of method to be used in decision-making by an organization, from a rational-actor model to an organizational-process model. Such a change may be necessary due to considerations made by the organizational-process model, on routine services carried out within an organization.

However, an appropriate combination of models used in decision making, with vibrant organizational structures positively impacts on an organization’s competitive advantage within the global market. Having an appropriate combination enables evaluation of the level of satisfaction for all stakeholders (Kuwashima, 2014). In addition, the functionality of the organization’s system is improved with a high reduction of cost.

For instance, at Hire-Jordan Smith, the structure of the organization is divided into eight parts. All the eight parts have different roles but rely on each other. The model used by Hire-Jordan-Smith is in most cases, the organizational-process model (Kuwashima, 2014). Whenever Hire-Jordan-Smith wants to launch any product or software an analysis of all the parts and the roles they will be involved in is made. Consequently, costs of production are reduced and communication improved, which boosts sales of any newly introduced Hire-Jordan-Smith product.

Conclusion

Through an examination of a rational-actor model, and the organizational-process model, this essay has shown that a rational-actor model explains decisions made by organizations, while the organizational-process model examines all process that is run within an organization. To analyze the process of making decisions the paper has looked at the case of Hire-Jordan Smith. It has come out clearly that, the models used in decision making are closely related to vibrant organizational structures. They both define connections maintained within organizations as they run their activities.

References

Boulesnane, S. & Bouzidi, L. (2013). The mediating role of information technology in the decision‐making context. Journal Of Ent Info Management, 26(4), 387-399. http://dx.doi.org/10.1108/jeim-01-2012-0001

Cricelli, L., Grimaldi, M., & Hanandi, M. (2014). Decision making in choosing information systems. VINE, 44(2), 162-184. http://dx.doi.org/10.1108/vine-04-2013-0022

Conaldi, G., Lomi, A., & Tonellato, M. (2012). Dynamic Models of Affiliation and the Network Structure of Problem Solving in an Open Source Software Project. Organizational Research Methods, 15(3), 385-412. http://dx.doi.org/10.1177/1094428111430541       

Courtney, M. (2013). When worlds combine [information technology]. Engineering & Technology, 8(5), 80-83. http://dx.doi.org/10.1049/et.2013.0513

Huang, Y. & Hutchinson, J. (2013). The roles of planning, learning, and mental models in repeated dynamic decision making. Organizational Behavior And Human Decision Processes, 122(2), 163-176. http://dx.doi.org/10.1016/j.obhdp.2013.07.001

Kuwashima, K. (2014). How to Use Models of Organizational Decision Making?. ABAS, 13(4), 215-230. http://dx.doi.org/10.7880/abas.13.215

Sun, Y. & Jeyaraj, A. (2013). Information technology adoption and continuance: A longitudinal study of individuals’ behavioral intentions. Information & Management, 50(7), 457-465. http://dx.doi.org/10.1016/j.im.2013.07.005

Van der Meer, M., Kurth-Nelson, Z., & Redish, A. (2012). Information Processing in Decision-Making Systems. The Neuroscientist, 18(4), 342-359. http://dx.doi.org/10.1177/1073858411435128

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