1-8 of 8 Results

  • Keywords: decision making x
Clear all

Article

From Decision Making to Decision Support  

Frederic Adam

In such a complex and well-researched domain as decision support systems (DSS), with a long history of authors making insightful contributions since the 1960’s, it is critical for researchers, especially those less experienced, to have a broad knowledge of the seminal work that has been carried out by prior generations of researchers. This can serve to avoid proposing research questions which have been considered many times before, without having consideration for the answers which have been put forward by previous scholars, thereby reinventing the wheel or “rediscovering” findings about the life of organizations that have been presented long before. The study of human and managerial decision-making is also characterized by considerable depth and seminal research going back to the beginning of the 20th century, across a variety of fields of research including psychology, social psychology, sociology or indeed operations research. Inasmuch as decision-making and decision support are inextricably linked, it is essential for researchers in DSS to be very familiar with both stream of research in their full diversity so they are able to understand both what activity is being supported and how to analyze requirements for developing decision support artefacts. In addition, whilst the area of decision support has sometimes been characterized by technology-based hype, it is critical to recognize that only a clear focus on the thinking and actions of managers can provide decisive directions for research on their decision support needs. In this article, we consider first the characteristics of human cognition, before concentrating on the decision-making needs of managers and the lessons that can be derived for the development of DSS.

Article

From Decision Support to Analytics  

Ciara Heavin and Frederic Adam

Since the 1960s, information technology (IT)/information systems (IS) professionals, data practitioners, and senior managers have focused on developing decision support capabilities to enhance organizational decision making. Initially, this quest was mostly driven by successive generations of technological advances. However, in the last decade, the pace at which large volumes of diverse data can be collected and processed, new algorithmic advances, and the development of computational infrastructure such as graphics processing units (GPUs) and tensor processing units (TPUs) have created new opportunities for global businesses in areas such as financial services, manufacturing, retail, sports, and healthcare. At this point, it seems that most industries and public services could potentially be revolutionized by these new techniques. The word analytics has replaced the previous individual components of computerized decision support technologies that have been developed under various labels in the past (). Much of the traditional researcher and practitioner communities who were concerned with decision support, decision support systems (DSSs), and business intelligence (BI) have reoriented their attention to innovative tools and technologies to derive value from new data streams through artificial intelligence (AI) and analytics. Identifying the main areas of focus for decision support and analytics provides a stimulus for new ideas for researchers, managers, and IS/IT and data professionals. These stakeholders need to undertake new empirical studies that explain how analytics can be used to develop and enhance new forms of decision support while considering the dilemmas that may arise due to the data capture and analyses of new digital data streams.

Article

Intuition in Management  

Eugene Sadler-Smith

An extensive literature has accumulated during the past three quarters of a century on the topic of intuition in management. The beginnings of management intuition scholarship are to be found in Chester Barnard’s insightful speculations on the role and significance of logical and non-logical processes in managerial work. Barnard’s thinking impacted profoundly Herbert Simon’s foundational concept of bounded rationality, which shed much needed light on how managerial decision-making is accomplished in real-world settings by using intuition as well as analysis. In parallel, management researchers in common with scholars in a wide range of applied fields also drew on Daniel Kahneman, Amos Tversky, and colleagues’ seminal behavioral decision research and its focus on the systematic errors and biases that accrue in managers’ intuitive judgments as the result of the use of heuristics (e.g., representativeness, availability, anchoring and adjustment, and affect heuristics). In recent years management researchers have drawn on further insights from Klein and colleagues’ work in naturalistic decision-making (NDM) (e.g., the “recognition primed decision-making model,” RPD) to conceptualize managerial work as expert performance and in understanding expert-versus-novice differences using the “skill acquisition model” (SAM). In recent years managerial intuition research has alighted on the dual-process theories of Epstein, Evans, Stanovich, and others as a conceptual foundation for further theorizing and research in terms of System 1 (also referred to as Type 1) and System 2 (Type 2) processing. More recently still, research in neurology (e.g., the “somatic marker hypothesis”) and social cognitive neuroscience (e.g., the specification of complementary “reflexive (X)” and “reflective (C)” systems) has mapped the physiological and neural correlates of intuitive processing and begun to inform not only intuition research but decision research more widely in management and organization studies. These various developments have shed light on how intuitive decision-making is accomplished in managerial work across diverse management subfields including entrepreneurship, business ethics, human resources, and strategic management. More recently, scholars are turning to paradox theory and process philosophy as alternative ways of viewing the phenomenon of intuition in organizations.

Article

Moral Emotion and Intuition in Organizations  

Armin Pircher Verdorfer, Martin Fladerer, and Clarissa Zwarg

While traditional approaches have described ethical decision-making in organizations mainly as being the result of rational deliberative thought, a steadily growing body of research indicates that moral decision-making is strongly influenced by moral intuitions and emotions. The moral intuition approach typically has two aspects: the process through which moral intuitions emerge and their content. With regard to the process, moral intuitions represent fast, automatic, evaluative reactions that are emotionally charged. An important tenet of moral intuition research refers to the primacy of intuition—the notion that moral intuitions generally drive moral decision-making. Accordingly, moral intuitions are described as starting points for rational reflection processes that follow later. On this basis, it has also been argued that the interplay of moral intuition and deliberation is malleable. Specifically, the well-formed moral intuitions of experts are thought to differ from the naive moral intuitions of novices. With increasing experience and reflection about the moral issues in one’s experiences, deliberation increasingly enables individuals to shift between intuitions and reasoning and to monitor, test, weigh, and reject both intuitions and reasons. The content of moral intuition refers to the foundations of morality, which are the underlying moral domain, specifying what individuals view as morally right or wrong. The most commonly referenced account in this field, Moral Foundations Theory (MFT), argues that moral intuitions are a function of evolutionarily developed, innate predispositions to master multiple social problems that interact with social and cultural influences. These predispositions, or moral foundations, include care, fairness, loyalty, authority, and sanctity. While empirical work on the role of moral intuition in organizations is still at an early stage, several areas have been identified that may particularly benefit from integrating moral intuition process and content. For instance, the moral intuition perspective can aid the understanding and prevention of processes through which unethical behaviors and practices, such as corruption, may be justified and normalized in organizations. Furthermore, the moral intuition perspective is increasingly used to study the moral leadership process, most notably the link between leader moral foundations and moral leader behaviors, as well as the role of (mis)fit between leader and follower moral foundations. Moral emotions are an inherent element of the moral intuition process and refer to the welfare of others and the promotion of a functioning society. It is thought that individuals experience moral emotions when they or others have violated moral standards. These emotions build the motivational force for moral action and are often placed in five clusters: other‐praising (e.g., gratitude), other‐suffering (e.g., sympathy), other‐condemning (e.g., contempt), self‐condemning (e.g., guilt), and self-approving (e.g., moral pride) moral emotions.

Article

The Application of Real Option Approach in International Business Research  

Tailan Chi and Yan Huang

The real option theory (ROT), a theory on investment decision making under uncertainty, has been applied to analyzing a broad range of questions in international business (IB). In the face of uncertainty, any discretion that the managers of a multinational enterprise (MNE) have over the timing, scale, speed, and sequence of investing or using the firm’s resources, in the forms of physical or intellectual capital or managerial time and effort, can be a real option. Such options confer upon the managers the right, but not the obligation, to exploit the upside potential while limiting the downside risk. Uncertainty, irreversibility, and absence of immediate and complete preemption are three necessary conditions for a real option to create value. Uncertainty offers opportunities to gather more information in the future, and such information can help managers make better decisions or alter prior decisions for improvement. Irreversibility is defined as the proportion of the investment committed to a project that cannot be recouped if the project is abandoned. Preemption refers to the revocation of the decision-making discretion that nullifies the option. It is possible to distinguish seven types of real options that have been examined in IB studies: (a) option to defer, (b) option to abandon/exit, (c) option to exchange, (d) option to grow/scale up, (e) option to contract/scale down, (f) option to switch, and (g) compound options. These types of options are found to influence a firm’s international market-entry strategies (e.g., location, timing, scale, speed, and mode) and the configuration and organization of the firm’s geographically dispersed production network. ROT has also been integrated with other economic theories, such as transaction cost economics and resource-based view, to better understand these decisions. Although ROT assumes a strong form of rationality on the part of the decision maker, it is also possible to incorporate cognitive or cultural biases into the theory and give the theory’s analysis greater realism. ROT represents a theoretical approach that can be integrated with various economic and noneconomic theories. More work in such theoretical integration can potentially help researchers gain deeper or more complete understandings of IB questions. Extant studies in IB typically analyze only a single type of option in isolation. But the global production network of a MNE typically has a portfolio of different types of options embedded, and the different types of options inevitably interact. The study of interactions among two or more types of options under different sources of uncertainty is likely to yield new insights on the strategy and organization of the MNE.

Article

Assessing the State of Top Management Teams Research  

Steven A. Stewart and Allen C. Amason

Since the earliest days of strategic management research, scholars have sought to measure and model the effects of top managers on organizational performance. A watershed moment in this effort came with the 1984 introduction of Hambrick and Mason’s upper echelon view and their contention that firms are a reflection of their top management teams (TMT). An explosion of research followed and hundreds, if not thousands, of manuscripts have since been published on the subject. While a number of excellent reviews of this extensive literature exist, a relative few have asked questions about the overall state and future of the field. We undertook this assessment in an effort to answer some key questions. Are we still making progress on the big questions that gave rise to the upper echelon view, or have we reached a point of diminishing returns with this stream of research? If we are at an inflection point, what are the issues that should drive future inquiry about top management teams?

Article

Strategic Decision-Making in Business  

Bill Wooldridge and Birton Cowden

Scholarly interest in how managers make strategic decisions dates from the inception of the strategic management field and continues in the present. Although such decision-making was originally conceived as a completely rational, top-management process, contemporary thinking recognizes that strategies from across multiple organizational levels change within social and political contexts. Within this broad domain, multiple research streams address a wide variety of topics and issues. Prominent among these are, (1) the extent to which strategic decisions are formed through comprehensive analysis versus piecemeal decision-making, (2) how characteristics of top managers and the composition of top management teams affect strategic decision-making, (3) the role of politics, conflict, and consensus in strategy making, (4) how cognitive biases and heuristics influence the process, (5) when and how intuitive judgments can form the basis for effective decision-making, and (6) how managers at various organizational levels participate in the process. Research across these streams is both descriptive and normative, with a focus on contextual contingencies and relationships to firm performance. Taken as a whole this literature has significantly enhanced understanding of how strategies form within organizations. Contemporary work continues to provide new insights and demonstrates the continued value of this productive area of study.

Article

Product and Innovation Portfolio Management  

Vinícius Chagas Brasil and J.P. Eggers

In competitive strategy, firms manage two primary (non-financial) portfolios—the product portfolio and the innovation portfolio. Portfolio management involves resource allocation to balance the important tradeoff of risk reduction and upside maximization, with important decisions around the evaluation, prioritization and selection of products and innovation projects. These two portfolios are interdependent in ways that create reinforcing dynamics—the innovation portfolio is the array of potential future products, while the product portfolio both informs innovation strategy and provides inputs to future innovation efforts. Additionally, portfolio management processes operate at two levels, which is reflected in the literature's structure. The first is a micro lens which focuses on management frameworks to boost portfolio performance and success through project-level selection tools. This research has its roots in financial portfolio management, relates closely to research on new product development and marketing product management, and explores the effects of portfolio management decisions on other organizational functions (e.g., operations). The second lens is a macro lens on portfolio management research, which considers the portfolio as a whole and integrates key organizational and competitive concepts such as entry timing, portfolio management resource allocation regimes (e.g., real options reasoning), organizational experience, and the culling of products and projects. This literature aims to set portfolio management as higher level organizational decision-making capability that embodies the growth strategy of the organization. The organizational ability to manage both the product and innovation portfolios connects portfolio management to key strategic organizational capabilities, including ambidexterity and dynamic capabilities, and operationalizes strategic flexibility. We therefore view portfolio management as a source of competitive advantage that supports organizational renewal.