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Approaches to Decision Making Theory

In: Business and Management

Submitted By jennykl
Words 1091
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Laroche being prescriptive and descriptive

Laroche follows a prescriptive method in arguing for decision making theory. He argues it is a social representation which will improve decision making. In his abstract he writes “The paper argues that […] the concept of organizational action should not be opposed to decision and decision-making. Decision and decisionmaking are best understood as social representations […]. As organization members think and act in terms of decision-making, a theory of organizational action cannot simply do without a theory of decision-making. “ showing clearly that he is prescribing a certain way of looking upon decision-making. This is further strengthened in the conclusion where he for example writes “This paper argued that decision-making is best understood as a process of reality creation through organization members’ representations of their own role and activity.” The extent to which Laroche is prescriptive is debatable however. He acknowledges descriptive factors such as when he claims in conclusion that “no theory of action can develop without integrating the fact that, to a significant extent, organizational members think and act in terms of decision-making... a relevant phenomenon for a theory of action, not a marginal one”. He lists examples from empirical studies in describing the decision-making process: “bureaucratic processes (e.g., Cyert and March 1963, Carter 1971), political processes (e.g.. Bower 1970), psychological processes (e.g., Janis 1972), etc. They constructed process typologies, both theoretic (e.g., Allison 1971, Fredrickson 1983, Chaffee 1985, Schwenk 1988a) and empirical (e.g, Nutt 1984, Shrivastava and Grant 1985, Hickson et al. 1986), and established the ways these processes interact (e.g., Quinn 1980)”. By providing such lists he links the ‘universal’ model of ‘logic’ in decision-making theory as being inherently supported by assumptions of ‘logic’. Decisions however are not always normative and thus although it is prescriptive and sometimes ‘constructed’ there may sometimes be impartiality with “distant familiarity” (Mattheu 1986) to dissociate.

Gond and Cabantous being more descriptive

Gond and Cabantous write in their abstract that “we approach rational decisionmaking as performative praxis” and “develop a performative praxis framework that explains how theory, actors, and tools together produce rationality within organizations through three mechanisms: rationality conventionalization, rationality engineering, and rationality commodification”. They here show that they are after describing the mechanisms associated with decision-making, not saying which way is the best or worst way to make decisions, hence being descriptive. Gond and Cabantous note that at times “rationality remains elusive”. They conceptualise rational decision making as performative praxis, “a set of decision making activities that turns rational choice theory into social reality” and comparatively to Laroche is descriptive on how decisions are ‘done’ from being ‘made’. Legitimisation and commodification for example play a role in the decision. Interactions promote a specific form of rational decision making. Thus rationality

being manufactured.

The articles being constitutive and performative

Laroche’s view on decision making is to a big extent constitutive according to what he presents about the concept of social representation - the practical way of thinking about and understand our surroundings. This can be applied in the every-day life in organizations, where decisions provide identity to actors. Constituity is the way of creating reality, to shape your surroundings, and leaders in organisations thus take decisions to justify that they are leaders and that their subordinates are followers. In the constitutive view on decision making the decision making becomes a tool to provide identity for actors and also to provide meaning to activities; by taking a decision that a meeting should be held and gathering employees to it, the employees can already expect what will happen on the meeting (eg discuss a problem and come up with a solution). By calling a meeting you also set the agenda for what is happening in the organization. This sort of decision making and decision processes help reduce uncertainty since the decisions become self-fulfilling prophecies. Cabantou and Gond’s article is to the greater extent performative written, examining the idea of rational decision making as performative praxis. When Laroche talks about actors and theories in a constitutive way, Cabantou and Gond is taking it further by adding tools to their arguing. For example actors in organizations use financial models to shape markets and realities. In their idea “conventionalizing rationality” Cabantou and Gond argue that rationality equips actors - how the rationality theory of choice is present as a common device in the actors’ heads and is being used by them to understand reality. The theory of rational decision making is commonly spread at business schools, why the theory manifests itself into the students’ heads and becomes the norm, for how to act and behave in our everyday life.

Similarities and differences

In both of the articles, the authors approach the rational model. How they approach it and how they relate to it differs. Laroche argues that previous students of decisionmaking have focused on how decision-making occurs and how they deviate from the rational model, not on what decision-making actually is. He argues that the rational view is not sufficient to understand decision-making. He then says that the best way to understand decision-making is by seeing it as social representations and hence he is being constituitive. He tries to define what decision-making actually is. Cabantous and Gond approach the rational model as something that has become performative praxis and that is exercised under interplay between theory, actors and tools. They hence incorporate the rational model in their theory and brings it one

step further, saying that the rational model also has become the appropriate way to take decisions in organizations. They show their performative view on decisionmaking. They don’t try to define what decision-making is, but rather tries to extend the concept. One could say here that Cabantous and Gond limit themselves by still moving inside the rational decision-making, whereas Laroche tries to move outside and have a totally different view. Another fundamental similarity of the articles is that they both describe the decisionmaking, where Laroche sees decision-making as something that humans in organizations do and that gives them identity in the group and in front of themselves, “I take decisions because I am the manager”, whereas Cabantous and Gond looks upon actors as only one part of the model, that interacts with the tools and the theory. For Laroche, the decision is actually taken by someone, whereas Cabantous and Gond see the decision-making as something that is made not only by humans and that can also be commodified.

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