MGMT 2003 The University of Sydney Business Decision Making Discussion

We’ve discussed in class the Pure Rational Choice Procedure model of decision-making:

1.Every possible alternative is considered.

2.Every consequence of every alternative is considered.

3.Every decision-maker (DM) preference for every consequence is considered.

4.There is an optimising (usually maximising) decision rule.

5.There is complete knowledge of all of the above.

and we’ve also discussed how this is rarely feasible in practice.

Give an example, from your experience, of a real-world decision that involved multiple alternatives, consequences and preferences, and for which the pure rational choice procedure was not feasible, so adaptation and compromise was necessary.

Describe in detail what adaptations and compromises were made for each of elements 1 to 4 of the pure rational choice procedure.

Please do not use the example of choosing courses in which to enrol (but choice of university or degree programs is ok). Try to find an example which is a good illustration of adaptation under conditions of bounded rationality. You’ll probably do the best job with this question if you write about a decision that you made, or for which you were a stakeholder.