A POSITIVE DYNAMIC APPROACH TO INDUSTRIAL DECISION-MAKING PROCESSES

This paper proposes and tests a decision-making process of entrepreneurs. History of many industries shows that rapid changes in technology, accompanied by large investments and accumulations of capital occur. One production method is replaced by another as newer cost reducing techniques become available. It seems that the fate of any particular production technique can be better understood in the context of such dynamic factors as changes in technical knowledge, factor prices, demand composition together with decision-making process of the entrepreneurs. A recursive programming technique is presented that reflects the fact that entrepreneurial decisions are conditioned by interaction between technical, economic, and non-economic factors. Recursive programming technique is a recent addition to the inventory of decision-making analysis. This method is applied to the Japanese Iron and Steel Industry. Results suggest that this technique is a very promising tool of decision-making analysis.     

ON THE DESIGN OF HIERARCHICAL PRODUCTION PLANNING SYSTEMS

To provide effective managerial support for decisions related to production planning and scheduling processes, it is useful to partition the set of decisions into a hierarchical framework. In the resulting system, higher level decisions impose constraints on lower level actions, and lower level decisions provide the necessary feed-back to reevaluate higher level actions. The purpose of this paper is to suggest optimum procedures to deal with the resulting subproblems and to analyze the interaction mechanisms among the different hierarchical levels. Computational results are given.     

Solving the Classification Problem in Discriminant Analysis Via Linear and Nonlinear Programming Methods*

This paper demonstrates the feasibility of applying nonlinear programming methods to solve the classification problem in discriminant analysis. The application represents a useful extension of previously proposed linear programming-based solutions for discriminant analysis. The analysis of data obtained by conducting a Monte Carlo simulation experiment shows that these new procedures are promising. Future research that should promote application of the proposed methods for solving classification problems in a business decision-making environment is discussed.     

新创企业高管团队的团队过程与战略决策绩效 ——认知的调节作用

新创企业的成败很大程度上取决于战略决策绩效,具有决策权力的高管团队在创业情境下的认知和行为过程对战略决策绩效具有重要影响。本文结合创业研究和高管团队研究的现有成果,以122家新创企业为研究对象,从内部团队过程和外部团队过程两个维度考察高管团队的团队过程对战略决策绩效的影响,并从认知的视角分析新创企业高管团队认知需要和认知能力对团队过程与决策绩效关系的调节作用。研究结果表明,新创企业高管团队的内部团队过程和外部团队过程与决策的质量和满意度均有显著的正相关关系,且认知需要和认知能力对这种关系具有调节作用,在认知需要和认知能力较高的情况下,内、外部团队过程对决策质量和满意度的正向影响更强。     

Medical decision-making around the time of death of cognitively impaired nursing home residents: a pilot study

The purpose of this article is to describe the end-of-life process in the nursing home for three groups of cognitively-impaired nursing home residents: those who died with a medical decision-making process prior to death; those who died without such a decision-making process; and those who had a status-change event and a medical decision-making process, and did not die prior to data collection. Residents had experienced a medical status-change event within the 24 hours prior to data collection, and were unable to make their own decisions due to cognitive impairment. Data on the decision-making process during the event, including the type of event, the considerations used in making the decisions, and who was involved in making these decisions were collected from the residents' charts and through interviews with their physicians or nurse practitioners. When there was no decision-making process immediately prior to death, a decision-making process was usually reported to have occurred previously, with most decisions calling either for comfort care or limitation of care. When comparing those events leading to death with other status-change events, those who died were more likely to have suffered from troubled breathing than those who remained alive. Hospitalization was used only among those who survived, whereas diagnostic tests and comfort care were used more often with those who died. Those who died had more treatments considered and chosen than did those who remained alive. For half of those who died, physicians felt that they would have preferred less treatment for themselves if they were in the place of the decedents. The results represent preliminary data concerning decision-making processes surrounding death of the cognitively-impaired in the nursing home. Additional research is needed to elucidate the trends uncovered in this study.     

AFFECTIVE RESPONSES WITHIN A COMPLEX DECISION-MAKING TASK: THE INFLUENCE OF “PERCEPTUALLY” ILL-STRUCTURED PROBLEMS

The perceptual effects of varying levels of expert advice for potentially improving on strategic decisions were examined in conjunction with goals. The amounts of advice about decision alternatives, as well as assigned goals ranging from “nearly impossible” to “easy,” were manipulated. The task used was complex and functioned perceptually as an “ill-structured” problem. Mixed results indicated that more advice significantly affected satisfaction but advice in general had little influence on effort. On the other hand, as goal difficulty decreased, satisfaction and effort significantly increased. Easy goals were superior to more difficult ones within this perceptually ill-structured decision-making situation.     

Situational impacts on leader ethical decision-making

Leader ethical decision-making has received a great deal of attention in the academic literature. Most research examining ethical leadership has focused on the leader characteristics and subordinate outcomes associated with ethical leadership, but research examining the situational variables influencing leader ethical decision-making is limited. Thus, the purpose of this study was to examine a number of situational variables that may influence leader ethical decision-making. This study examined the impacts of performance pressure, interpersonal conflict, the leader's decision-making autonomy, the type of ethical issue at hand, and the level of authority of the other person involved in the interaction. The results indicated that when making a decision in response to a superior (as opposed to a peer or subordinate), leaders make worse decisions. Additionally, a number of interactions of the other variables negatively impacted leaders' ethical decision-making. The implications of these findings are discussed.     

Application of the Back Propagation Neural Network Algorithm with Monotonicity Constraints for Two-Group Classification Problems*

Neural network techniques are widely used in solving pattern recognition or classification problems. However, when statistical data are used in supervised training of a neural network employing the back-propagation least mean square algorithm, the behavior of the classification boundary during training is often unpredictable. This research suggests the application of monotonicity constraints to the back propagation learning algorithm. When the training sample set is preprocessed by a linear classification function, neural network performance and efficiency can be improved in classification applications where the feature vector is related monotonically to the pattern vector. Since most classification problems in business possess monotonic properties, this technique is useful in those problems where any assumptions about the properties of the data are inappropriate.     

Game theory technique in investment planning

A planner makes use of various techniques in the process of planning. One of the techniques, which could be used effectively by the firm in investment planning, is the Game Theory. The purpose of the paper is to explain this technique with illustrations. The author has used this technique successfully in several decision-making situations and one of the real-life applications is presented here.     

A COMPUTER-BASED METHOD FOR PREDICTING TRANSIT TIME PARAMETERS USING GRID SYSTEMS

This article reviews a computer-based method to predict transit time parameters (mean and variance) from historical data for use in logistics planning analysis. Efficient use of the data depends on relating it to a grid system of the United States. Performance of the technique on a sample of shipments by four methods of transportation is compared to a system based solely on highway distance. The techniques perform equally well for average transit time (speed). The grid system method demonstrates superior predicting power for reliability (transit time variance). Use of the system in daily operations is also anticipated.     

Exploring Contrasting Formulations of Expectancy Theory*

The explanatory potential of four forms of expectancy theory with additive and multiplicative expectancy terms and linear and nonlinear valence functions were contrasted. A behavioral decision-making theory approach was used when 101 subjects were asked to make 128 hypothetical job-choice decisions. More than 25,800 decisions under a within-subjects framework were analyzed. Results indicate that the majority (83 percent) of subjects employed additive or multiplicative expectancy models with linear valence functions. However, the predictive efficacy of the expectancy theory model was improved for 17 percent of the subjects when nonlinear valence terms were introduced. The findings imply that different functional forms of expectancy theory may be needed to model individuals' decision-making processes.     

Process matters – How strategic decision-making process characteristics impact capital allocation efficiency

We employ strategic decision-making process theory to study the internal capital markets of firms and argue that varying allocation efficiency can result from the configuration of the capital allocation decision-making process. Learning from earlier research on firms' portfolio allocations, we also develop assumptions on interaction effects with firm-level unrelated diversification and environmental dynamics. We test our hypotheses with structural equation modeling on an international sample of large multi-business firms. Our results suggest that process formalization and analytical comprehensiveness have a positive influence on the efficiency of allocation decisions. Another key result is that unrelated diversified portfolios positively moderate the influence of analytical comprehensiveness and formalization, while dynamic environments negatively impact the influence of formal processes but reward managerial involvement.     

Rule-Based Expert Systems and Linear Models: An Empirical Comparison of Learning-By-Examples Methods*

Building models of expert decision-making behavior from examples of experts’ decisions continues to receive considerable research attention. In the 1960's and 70's, linear models derived by statistical methods were studied extensively. More recently, rule-based expert systems derived by induction algorithms have been the focus of attention. Few studies compare the two approaches. This paper reports on a study that compared linear models derived by logistic regression with rule-based systems produced by two induction algorithms—ID3 and the genetic algorithm. The techniques performed comparably in modeling the experts at one task, graduate admissions, but differed significantly at a second task, bidder selection.     

Linear and Nonlinear Valence Functions: A Behavioral Decision-Making Assessment

In Vroom's [45] original formulation of expectancy theory, the relationship between affect and perceived instrumentality was assumed to be linear. Others have suggested that such a relationship may be better modeled by a nonlinear, utility-type function [30]. The current research contrasts the predictive ability of two linear and four nonlinear functions. Using four levels of McClelland's [26] needs for achievement, affiliation, and power as instrumentalities, 101 subjects provided more than 12,900 decisions on the valences of jobs in a behavioral decision-making experiment. Nearly 40 percent of the subjects exhibited nonlinear valence functions. The results emphasize the need to specify the appropriate functional form of the valence component to enhance predictive accuracy and to prevent misspecification problems.     

Organizational Computing as a Facilitator of Operational and Managerial Decision Making: An Exploratory Study of Managers' Perceptions*

Much of the current knowledge pertaining to information technology (IT) and decision making is based on decades old technologies that revolved around a central computing function and application-specific systems. The purpose of this research is to examine the IT decision-making relationship within the emerging organizational computing (OC) environment permeated by spontaneous utilization of both application-and nonapplication-specific computing and communication technologies. Specifically, this study seeks to explore managers' perceptions of the emerging OC environment as a facilitator of their decision-making activities. To achieve a higher level of clarity than previous works, a two-dimensional research framework is developed with the IT dimension consisting of computing and communication, and the decision-making dimension differentiated between operational and managerial decisions. A survey instrument was constructed that measured the computing and communication dimensions of information technology use and their perceived effects upon operational and managerial decisions. The major findings of the study confirmed that managers recognize the value of general, nonapplication-specific information technologies in decision making, and that this recognition is highly associated with how intensively these information technologies are used. Additionally, it was found that the two dimensions of IT differ in their relationships to decision making, and that IT usage relates to managerial decisions differently than operational decisions. These study findings have significant implication for practice and research, especially in the context of information resource management in which the primary purpose of the IS function is the delivery of general information service to users rather than the development of specific IS applications.     

The Greater Ability of Graphical Versus Numerical Displays to Increase Risk Avoidance Involves a Common Mechanism

By displaying a risk reduction of 50% graphically rather than numerically, Stone, Yates, and Parker significantly increased professed risk-avoidant behavior. The current experiments replicated this effect at various risk ratios. Specifically, participants were willing to spend more money to reduce a risk when the risk information was displayed by asterisks rather than by numbers for risk-reduction ratios ranging from 3% to 97%. Transforming the amount participants were willing to spend to logarithms significantly improved a linear fit to the data, suggesting that participants convert this variable within the decision-making process. Moreover, a log-linear model affords an exceptional fit to both the graphical and numerical data, suggesting that a graphical presentation elicits the same decision-making mechanism as does the numerical display. In addition, the data also suggest that each person removed from harm is weighted more by some additional factor in the graphical compared to the numerical presentations.     

The edge of reason: A thematic analysis of how professional financial traders understand analytical decision making

This study uses thematic analysis to investigate accounts of Type 2 (analytical, rational and reflective) decision-making processes in professional financial traders working in the City of London. Previous studies have focused on using qualitative methods to examine trader understanding of Type 1 decision-making (intuition and ‘gut feeling’). No published study has investigated how traders view Type 2 decisions. Findings from semi-structured interviews with 14 traders revealed two overarching themes derived from four subthemes. The first overarching theme (‘Knowledge gap’) demonstrated that traders do not find their analytical decision-making processes as accessible as dual-process theory predicts. In particular, traders failed to label processes such as reading research or evaluating data as analytical. In contrast, they viewed Type 2 decisions in a ‘saviour’ role where these processes offered traders psychological or emotional support during loss making periods. The implications of these findings are discussed with respect to the decision-training of traders, their management, and practice.     

Developing expert systems for management applications

The Alvey Report has resulted in a growing interest in the UK in ‘expert systems’. It is fairly generally accepted, at least in the UK, that such systems function in a particular type of way, i.e. they arrive at decisions through a process of rule based inference. It is suggested that it may be more fruitful to regard rule based inference as one approach to the construction of expert systems, and that proven techniques of operational research may well be more useful in constructing other types of expert system. Alternative applications of expert systems are derived on the basis of a broader definition of an expert system in terms of what it does rather than how it does it. A parallel is drawn between these applications and some typical concerns of business research. It is suggested that a useful aid in identifying promising business applications of expert systems is to set up four ‘dimensions’ along which different types of system differ. Examples are given of where other techniques might conceivably be useful in applications of expert systems.