Organizational Decision-Making: Situational/Contextual Frameworks
Different contexts call for different leadership approaches. For this reason, Snowden and Boone (2007) emphasize the importance of recognizing the context at a specific time before deciding what action or decision to take. As a guide, the authors developed the Cynefin framework, which categorizes the issues that leaders face into four contexts defined by the nature of the cause-and-effect relationship: simple, complicated, complex, and chaotic. This text analyzes the applicability of different decision-making approaches in each the four contexts.
Applicability of Tools of Rational Economics
Rational economics is an economic theory that assumes that individuals will always make decisions that offer the highest possible level of utility given the choices available (Bruce, 2016). The cornerstone of rational economics is that individuals have perfect information about all available alternatives and their features (Bruce, 2016). Under rational decision-making, an individual identifies a problem, establishes decision criteria, generates alternatives, weighs alternatives, and then selects the best alternative from the available choices (Bruce, 2016). This process may work in the simple and complicated contexts, but may be irrelevant in complex and chaotic contexts.
In a simple context, cause-and-effect relationships are clear and the best decision is easily identifiable (Snowden & Boon, 2007). The team members thus have perfect knowledge about the available alternatives and they only need to categorize and implement the same. In a complicated context, cause-and-effect relationships are not necessarily clear to everyone, although there are several likely solutions to the problem (Snowden & Boon, 2007). In this case, team members could obtain all relevant knowledge through research to accurately establish cause-and-effect relationships, and then choose the best alternative.
For the complex and chaotic situations, however, cause-and-effect relationships are either unclear or non-existent, making it impossible for team members to identify or even weigh different alternatives as...
At least one right decision exists in a complex context, but since participants lack perfect information on cause-and-effects, the decision chosen may not necessarily be the best decision. Complex contexts are characterized by turbulence that makes it impossible to establish causes and effects and hence, identify the best alternatives.
Human Behavioral Responses and Organizational Discipline in each of the Frameworks
Behavioral theories suggest that humans behave a certain way when faced with stressors. However, organizational discipline emphasizes the idea of exercising restraint and
learning to follow the best course of action even when that action...…team led by a reliable crisis manager to develop strategies, chart a way forward, and communicate.
Use of Big Data and Data Analytics to Bring Clarity
Big data and data analytics helps to bring more clarity into the process of organizational decision-making. Big data is characterized by huge quantities of data coming from a variety of sources with a high speed of generation (Steward & Cavazos, 2019). Through
reading and conducting online searches, an organization can obtain an unprecedented amount of information on the potential causes of a certain problem, the various alternative solutions, and the best solution. For instance, the process of rational decision-making requires one to accurately identify the problem, identify alternatives, and weigh various alternatives to obtain the best possible solution. Big data makes it possible for team members to identify alternatives from resources available online and to weigh alternatives by assessing the levels of success realized by organizations that have adopted each alternative before. This provides room for more accuracy in the decision-making process and increases chances of obtaining the best solutions. Big data and data analytics, therefore, facilitates the process of rational decision-making even in complex and chaotic contexts as it serves as a source of…
