Common sense and hard decision analysis: why might they conflict?
Goodwin, P., 2009. Common sense and hard decision analysis: why might they conflict? Management Decision, 47 (3), pp. 427-440.
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Purpose - Hard decision analysis models allow complex decisions to be broken down into easier-to-handle and precisely defined sub-problems and also provide a documented rationale for the decision. This paper aims to investigate why the course of action prescribed by a hard decision analysis model can sometimes conflict with a manager's common-sense view of the appropriate course of action, even when the model is based on judgments elicited from the manager. It also discusses how such conflicts might be resolved so that the decision can be made with greater insight and confidence. Design/methodology/approach - The paper draws on the decision making and psychology literatures to obtain a definition of common-sense and to show how and why it might lead to conclusions that are at variance with those indicated by rational decision model. Findings - Four possible reasons for conflicts between common-sense and a hard decision analysis model are identified. First, common sense reasoning is fuzzy while decision analysis models are precise. Second, under some circumstances, the axioms of a decision analysis model may conflict with common sense. Third, the decision model may be a misrepresentation of the decision problem because errors may have occurred when judgments were elicited from the decision maker. Fourth, common sense may suggest an inferior course of action. Practical implications - The paper shows the potential dangers of making decisions based on common-sense alone or of relying unquestionably on a decision analysis model. Originality/value - The paper shows that the exploration of conflicts between the indications of decision analysis models and common sense and may lead to better decision making.
|Uncontrolled Keywords||decision making, managers, intuition|
|Departments||School of Management|
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