For this paper, I have chosen chapter 7 (Decision Making and Creativity) and to use key concepts from this chapter to explain a project which I was responsible for at work and how the outcome could have been executed with the use of these key concepts that I will discuss. The chapter’s definition of decision making is “the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs.” Decision making is used in our everyday lives, either at work or at home, we have to decide on what actions to take and live with the results from the actions we have chosen if they were a good decision or bad one. The “Rational Choice Paradigm of Decision Making” is a good tool to use to understand how a decision is made from a logical stand point but it leaves out emotions, which plays a big role when making a decision. The rational choice paradigm of decision making includes identifying problems and opportunities, choosing the best decision style, developing alternative solutions, choosing the best solution, implementing the selected alternative, and evaluating the decision outcome. The ultimate principle of the rational choice paradigm is to choose the alternative with the highest subjective expected utility. This involves calculating (1) the probability that each alternative will cause any of the possible outcomes to occur and (2) the value (or happiness) of those possible outcomes. When evaluating and choosing an alternative, Herbert Simon argued that “people engage in bounded rationality because they process limited and imperfection information and rarely select the best choice.” In decision making, employee involvement (also called participative management) refers to the degree to which employee’s influence how their work is organized and carried out. Employees can identify problems, choose the best alternative, and implement choice, so getting your employees involved in a decision making process would be a smart management move especially when they are the experts doing the job.
LIFE SITUATION In my current job at Lieberman Management Services, I am a Senior Property Accountant in charge of 7 Property Accountants that perform varies financial/accounting duties for 240 condominium associations. When I first got hired on, my first task was to create a workflow that demonstrated how the processes flow thru the accounting department and recommend any inefficiencies (problems) that could be corrected to help stream line the department. This was a task that took me up to 1 month to complete. First, I had to meet with my boss (Director of Finance) to discuss what the objectives and outcomes he is expecting from this project. His direction was unclear and did not outlay the expectations, so without evaluating the outcome of the project, I decided to start by first overlooking the processes that our accountants do on a daily basis. My decision making process was not thought out precisely and I did not take the time to brainstorm on what would be a good starting point to understand our accounting process. I was unclear of the final result but still proceed with my observation. From weeks of observation working with the accountants, I felt that my understanding of our process was good and could remove some process and delegate some of the work for other accountants to focus on. I broke out the responsibilities to specific job duties for our accountants, without realizing the ramification of how the accountants would feel being only assigned to certain duties. I had 3 accountants work out cash flows, issues with Property Managers & Board of Directors, and month end reconciliations. The other 3 Accountants I removed them from their other duties and reassigned them to focus on vendor related issues, data retrieval, property taxes, auditors and preparation of our financial package to our clients. The last accountant I had reassigned was to handle all internal projects, preparation for year-end and work with our issues with our accounting system “Jenark”, which we had a lot of issues with. I needed someone to be an expert in this system, someone to know how to fix a problem with little time. Making all these decisions was the down fall of my accomplishments. I tried to focus my attention on solution-focused problems and reorganized the department from my past mental models I had in my head from past experiences with a different company not realizing this company has a different business model and goals, which were different because we were a non-for-profit organization. When I meet with my boss, he was happy with the changes but never really took the time to understand the changes, why I made this move, what is the outcome, how are the accountants accepting of this change, etc... After a month of everyone’s job responsibilities have been moved around, I never really revisited the situation on how my rational decision making would affect our accountant’s moral and motivation to be efficient after the changes have been made. The end result came to me with a blow to my door; I had 4 people resign in 2 months since I was hired on to the company. This made a huge setback for the goals I wanted to accomplish for the department, I had to rehire more accountants and train them to fit our new workflow process. This took me additional 2 months to do but in the end I could have avoided people leaving if I never approached my decisions with a systematic way of how I thought the department should run.
DIFFERENT OUTCOME BY APPLYING CONCEPTS FOR CH.7 How should people make decisions in an organization with the highest subjective expected utility? As a leader, I never followed a process that would help me layout what things to change and how the effect of my changes would be measured by everyone in the department. If I would have identified the problems with our current process, choose the best decision by valuing what my accountants thoughts on the changes that were made(get them involved on my decision making), develop alternative solutions (instead of alter job responsibilities for specific people), chose the best alternative (what would be good for all of the accountants), implement the selected alternative, and evaluate the decision outcome (revisit the workflow, see how efficient we are running, and how happy everyone was with the changes), this situation could have been more of a success. I impressed my boss but he did not have the motive to assist me with tools I needed to accomplish this task and every time I setup meetings with him to discuss some solutions I came up with, he would just say to me. “I am busy so just keep up the good work”. I felt my presence was not valued as much as it should have been so without any help, I relied on my mental models that were created from my past job, which really didn’t give me a positive realization on how this department was running and what were the efficient process that already was in place. I compared new alternatives with implicit favorite alternatives that I thought would be best choice and used more intuition from a manager’s perspective instead of the accountant’s perspective. Overall, I did get the job done and improved our accounting departments inefficiencies but I would of rather involved more of the experts (accountants) with my decision making process.