Framing and Linear Models of Decision Making
Decision making especially when it comes to solving problems is not such a natural process. It is a vital process especially in managerial and organizational activities (Bazerman, 2008). Decision-making tools and techniques are mechanics that researchers and theorists have come up with to assist in the decision-making process (Mun, 2002). They aim to provide a better analysis of all the decisions that are involved in deciding to come up with the best choice. Some of these tools and techniques are framing, linear models, decision matrix, decision tree, cost-benefit analysis, and multi-voting. Framing differs from one individual to another. When faced with the same situations and one person frames the situation with regards to gains whereas the other frames it with regards to losses, the two people will end up making very different decisions.
At times this makes people make irrational decisions. They concentrate more on what they will gain at lower risk or no risk at all as compared to the much more they would gain if they took more risk. Where losses are involved, people prefer to make quick decisions that are steered towards suffering fewer losses (De Martino et al. Relying on information from an inside source, the contracts are only renewable based on your performance. Suppose am successful and I get a chance to have this job. Within the six months, that is the same period that the company advertises its graduate management trainee job. The graduate management trainee job is what I need to start up my career (the contract is not well related to my career), and since the company is well established, this will be an excellent opportunity for me.
Its graduate management program runs for 18months with no promise of permanent employment. The loss here is lack of a permanent job after 18 months and a constant flow of income. Based on the simple linear model I will end up selecting the graduate management program. Looking at gains as a variable, the gains involved in the graduate management job are much better than those involved in the contract job. The simple linear model simple aligns all the benefits that I gain to come up with what I will expect in future. From the graduate management job is the best option. I would list all the gains the organization will benefit from me. I would also list all the dangers involved in hiring an outsider.
That would give me a better opportunity in getting the position. I would use the simple in my organization to evaluate the investment decisions. With investments, a lot of risks is involved and for one to be a successful investor, they to be risk lovers (Hanoch et al. Other decision-making tools such as the simple linear model work well for many decisions, but one needs to choose the right variables to benefit using it. Decision making is not a natural process, and one needs to think and act smartly to come up with the best solutions. References Mun, J. Real options analysis: Tools and techniques for valuing strategic investments and decisions (Vol. John Wiley & Sons. , & Wilke, A. Domain specificity in experimental measures and participant recruitment: An application to risk-taking behavior.
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