Poor Decision Making in the Workplace - Term Paper Example

Poor Decision Making in Workplace Name Institution Course Date Executive Summary The relevance of this paper is to ascertain the importance of decision making and the issues that lead to poor decision making. Poor decision making is common practices within a workplace and are classified as a mistake. Most of the poor decisions made always entails an immediate reward which comes with a hefty price to pay. This paper will discuss the various issues that lead to poor decision making such as: procrastinating, not being systematic and not involving stakeholders to name a few. Furthermore, it will discuss the various theories applied in decision making such as: Rational actor model, Incremental model, Prospect theory and Satisficing theory. It will also discuss rational decision making procedure and finally, it will provide recommendations for an effective minimization of poor decision making. Table of Contents Table of Contents Table of Contents 3 1.0 Introduction 4 3.0 Discussion 7 3.1 Workplace Issues 7 3.1.1 Procrastination 7 3.1.2 Not Being Systematic 7 3.1.3 Not Considering Different Viewpoints 7 3.1.4 Not Involving Stakeholders 8 3.1.5 Avoiding Groupthink and Psychological Bias 8 3.1.6 Not Communicating Effectively 8 3.1.7 Not Thinking of Consequences 8 3.2 Theories of Decision Making 9 3.2.1 Rational Actor Model 9 3.2.2 Incremental Model 9 3.2.3 Prospect Theory 10 3.2.4 Satisficing Theory 10 3.3 Rational Decision Making Process 10 3.3.1 Identifying the problem 11 3.3.2 Generating alternatives 11 3.3.3 Evaluating alternatives 11 3.3.4 Choosing the alternatives 11 3.3.5 Implementing alternatives 11 3.3.6 Evaluating decision effectiveness 12 4.0 Conclusion 12 1.0 Introduction Decision making is referred to as a process or sequence of actions which are involved in recognition of a problem, seeking information, description of alternatives and selection of either one or two alternatives which are in line with the ranked inclinations (Gore, 2016). Decision making is an important section of planning are used in every management operations though commonly they are regarded as a section of the planning process. Decision making is a chief skill within a workplace environment and is specifically essential if an individual wants to be an effective leader within a workplace (Gore, 2016). In addition, decision making can be considered as a result of mental processes also known as cognitive processes, resulting to the choice of a strategy among a number of alternatives (Gore, 2016). Almost all decision making processes come up with a final conclusion and the output can either be an action or an opinion. Therefore, human performance in relation to decision making terms has been subject of active study from a number of vantage points. For instance, from a psychological perspective, it is a requirement to assess a person’s decision in the circumstances of a set of needs and values he/she requires. Furthermore, from a cognitive point of view, the process of decision making can be referred to as an uninterrupted process incorporated in the interaction with the environment (Gore, 2016). In a normative perspective, the assessment of a person’s decisions is related with the logic of decision making as well as rationality. On the other hand, poor decision making is common practice within a workplace and is classified as a mistake. Most of the poor decisions made always entails an immediate reward which comes with a hefty price to pay (Michailidis and Banks, 2016). Furthermore, poor decision making within workplace can be as a result of the stress of making a decision which sets most people within a workplace to fail. Individuals within a workplace environment are always motivated to evade any of the choices they may regret later (Michailidis and Banks, 2016). Therefore, this hard-wired fear of performing the wrong action results to stress which has the capability of impacting one’s decision making abilities especially to the point one hadn’t wished to do. Additionally, poor information often results in the occurrence of a poor decision making. A wrong choice of information may result to a poor choice especially when it comes to making the decision before you (Michailidis and Banks, 2016). Therefore, when an employer or employee within a working environment is confronted with too numerous options, his or her brain overheats and hence lose the ability to sift and assess any useful information leading to poor decision making. This report will discuss poor decision making within a workplace and the various mistakes that lead to poor decision making. Furthermore, it will highlight various conceptual theories on decision making and provide steps of rational decision making, finally, it will provide recommendations on improving decision making in the workplace environment. 2.0 Findings In my workplace, project managers are the people who are responsible for undertaking and overseeing every project within the company. There was a water installation project that was contracted to my company and I was in charge of providing the design layout of the project. The project was scheduled to be conducted and flagged off within a period of one and a half years. During this period, minimal work in terms of project implementation was carried out yet the scheduled time was coming closer and closer. Before completion of the project, the firm started having financial difficulties in funding the project. The project managers in the company started faking records so that it matches with what was on paper in order to hide any losses incurred to the company due to their incompetence. This eventually led to law suits charged at the company by the employer which resulted to further loss to the company. Also, I experienced another case of poor decision making within the workplace with the when the management of a pharmaceutical company marketed a product called Effexor. This product has serious side effects to the persons using the drug. The management was responsible of defrauding the medical program by introducing the medication into the market yet they had clear knowledge of the repercussions of the drug. The product was said to cause high risks of possible birth defects as well as side effects such as Type 2 diabetes and it is also considered an anticoagulant. Due to their poor decision making, the company faced numerous lawsuits from their customers which drastically reduced their revenue due to the drop in sales of the drug. This was a case of poor decision making which was fuelled with utter negligence by the management for introducing an inappropriate product into the market. 3.0 Discussion 3.1 Workplace Issues The workplace issues that result in the occurrence of poor decision making includes: procrastination, not being systematic, not considering different viewpoints, not involving stakeholders, avoiding group think and psychological bias, not communicating effectively and not thinking of consequences. 3.1.1 Procrastination Poor decisions making are often made when individuals place their decisions to the back of their minds and attend to others that are of less importance (Burke and Miller, 2005). Putting off decision making can degrade your situation leading to making poor decisions at a workplace. 3.1.2 Not Being Systematic This issue doesn’t involve a structural approach since it lacks any form of logical and orderly process which can assist one deal with every critical component required for a successful result (Burke and Miller, 2005). This leads to poor decision making since one tends to overlook important factors. 3.1.3 Not Considering Different Viewpoints Poor decision making is attributed to failing to consider other perspectives because of individuals rushing to decisions without considering other perspectives, especially when under pressure to beat deadlines (Burke and Miller, 2005). This eventually leads to a negative outcome. 3.1.4 Not Involving Stakeholders Some workplace environments fail to involve their stakeholders in making crucial decisions. Therefore, making decisions which are likely to affect others within the company or even outside without involving the stakeholders may lead to poor decision making (Burke and Miller, 2005). 3.1.5 Avoiding Groupthink and Psychological Bias Avoiding group is another issue that leads to poor decision making. This is because an individual may not thoroughly evaluate and consider every possible option. On the other hand, when people group think, they tend to have more options regarding good decision making and problem solving (Burke and Miller, 2005). In addition, psychological biases also play a major role in promoting poor decision making. This includes the tendencies of jumping into conclusion, blaming others and also expecting prior events to affect the future. 3.1.6 Not Communicating Effectively Miscommunication and failure to communicate with colleagues within a workplace environment constantly lead to occurrence of poor decision making. If an individual makes a mistake that affects others, he or she has the mandate to inform them about it so that appropriate actions are taken to deal with the situation (Burke and Miller, 2005). 3.1.7 Not Thinking of Consequences Some individuals within a workplace fail to consider how their choices may affect their future and thus focus on “here and how” instead (Burke and Miller, 2005). This issue might result in poor decision making since the decisions made might be difficult because of the worries of long term consequences of a decision. 3.2 Theories of Decision Making There are a number of theories of decision making and they include: rational actor model, incremental model, prospect theory and satisficing theory. 3.2.1 Rational Actor Model The basic thought of this model is extracted from the economic theory and utilitarianism. The concept of this theory is founded upon the thought of an “Economic man” who conducts all decisions based on rationality and utility (Wong and Kwong, 2007). The economic man engages in a specific process which thinks in his judgment rational and at the same time ensures maximum utility. Therefore, issues such as not being systematic can be adequately addressed by this theory since it provides one with rationality and utility which can be used as a basis of creating a logical and orderly structure before making a firm decision. In addition, this theory can address this issue because it provides an individual with a cost-benefit approach which enables one to critically evaluate a situation, taking into considerations its effects before making a firm decision (Wong and Kwong, 2007). 3.2.2 Incremental Model In this theory, in order to come to a perfect decision, it is essential that both facts and information are impartial and correct (Frost, 2000). In this theory, a decision maker assumes a tendency of evasion. He or she wants to evade issues or uncertainty and therefore follow a policy of incrementalism. Furthermore, in this theory, decisions are not developed once for all, but are made gradually by the decision maker therefore, in such method, there is great significance of both flexibility and decision making (Frost, 2000). For instance, issues such as failing to consider other viewpoints can be adequately addressed by this theory. This is because an individual is required to look at every possible perspective while gaining enough information before making a firm decision 3.2.3 Prospect Theory This theory anticipates that decision makers incline to risk averse in a field of gains or even when there is a favourable anticipation (Chinomona and Mofokeng, 2014). Similarly, the decision maker is comparatively seeking risks in an area of losses. Therefore, it states that people aim for uniqueness with regard to prospect in consideration and thus will tend to shy away from elements that is mutual to all. Furthermore, this theory determines that individuals lean more towards the results gotten with certainty as opposed to those that is gotten by mere possibilities. 3.2.4 Satisficing Theory In this theory, decision maker functions with limited and simplified knowledge in order to reach acceptable, compromise options rather than maximizing strategies where one specific objective is entirely attained (Frost, 2000). Furthermore, this theory describes the behaviour of decision makers under conditions with which an ideal solution cannot be decided. 3.3 Rational Decision Making Process Rational decision making is regarded as the primary function of management since every organizational manager makes numerous decisions either subconsciously or even consciously thus making it a chief element in the function of a manager (Halvorsen, 2013). It involves the following process: identifying the problem; generating alternatives; evaluating alternatives; choosing the alternatives; implementing alternatives and evaluating decision effectiveness. 3.3.1 Identifying the problem This step involves recognizing the problem, defining the initial solution and commencing primary analysis (Halvorsen, 2013). 3.3.2 Generating alternatives This step, two of three solutions to the problem are enclosed as well as the preliminary implementation to the site (Halvorsen, 2013). In addition, all possible solutions are generated in this stage in order to adequately facilitate the evaluation of alternatives. 3.3.3 Evaluating alternatives In this step, alternatives are measured in order to decide their success or failure (Halvorsen, 2013). This step entails both secondary as well a final analysis to the problem. 3.3.4 Choosing the alternatives This step constitutes a final solution as well as a secondary implementation (Halvorsen, 2013). In addition, the process has grown into various strategies of ways to apply the solution. 3.3.5 Implementing alternatives This step involves the final implementation as well as a preliminary monitoring of the results (Halvorsen, 2013). 3.3.6 Evaluating decision effectiveness This step entails the evaluation of the decision and whether it has the ability to produce the desired results (Halvorsen, 2013). It is a continuous, never ending process. 4.0 Conclusion Poor decision making within a workplace is classified as a mistake and often comes with a hefty price to pay. Poor decision making results from various issues such as procrastination, not being systematic, not considering different viewpoints, not involving stakeholders, avoiding group think and psychological bias, not communicating effectively and not thinking of consequences. In addition, there are a number of theories that are used in decision making processes. These theories include: rational actor model, incremental model, prospect theory and satisficing theory. Furthermore, rational decision making process involves a number of steps namely; identification of problem, generating alternatives, evaluating alternatives, choosing alternatives, implementing alternatives and evaluating decision effectiveness. 5.0 Recommendations This report has shown that poor performance can be very costly when making a decision. Therefore, proper communication within the workplace environment can be a very effective way of minimizing any occurrence of poor decision making. Furthermore, involving the employees in the decision making process in form of group think can help evaluate every kind of alternative before making a firm decision furthermore, a process should be put in place to assess the fundamental assumptions behind group decisions. Poor decision making can also be avoided by ensuring that chief stakeholders are well represented within the group of decision makers in order to grow their commitment to a certain decision. Furthermore, prior to solving a problem, a workplace should utilize CARWOE checklist which can be used to brainstorm the various elements as well as people impacted by the decision. In addition, this can be done from six perspectives namely: customer, actor, world view, owner, transformation process and environmental constraints. In terms of systematic approach, poor decision making can be minimized by creating a constructive environment within the workplace, investigating the circumstance and finally generating good alternatives. 6.0 References Burke, L and Miller, M 2005, Examining Gender Differences in Intuitive Decision Making in the Workplace: And Exploratory Investigation, Gender and Behaviour, vol. 3, no. 1, pp. 252-268 Chinomona, E and Mofokeng, T 2014, The Influence of Workplace Condition and Employee Satisfaction on Employee Commitment: A Behavioural Decision Making Perspective. Mediterranean Journal of Social Sciences, Vol. 5, no. 27, pp. 5. DOI: 10.5901/mjss.2014.v5n27p1015 Frost, A 2000, Union involvement in workplace decision making: Implications for union democracy, Journal of Labor Research, vol. 21, no. 2, pp.265-286. Gore, J 2006, Naturalistic Decision Making and Organizations: Reviewing Pragmatic Science. Organization Studies, vol. 27, no. 7, pp.925-942. Halvorsen, K 2013, Team decision making in the workplace: A systematic review of discourse analytic studies, JAPL, vol. 7, no. 3, pp.273-296. Michailidis, E and Banks, A 2016, The relationship between burnout and risk-taking in workplace decision-making and decision-making style, Work & Stress, vol. 30, no. 3, pp.278-292. Wong, E & Kwong, J 2007, The role of anticipated regret in escalation of commitment, Journal of Applied Psychology, vol. 92, no. 2, pp. 545-554. Read More