Decision making in the focus of psychological research
Features of decision making in United States small business
A survey of United States entrepreneurs MA Chernysh, OI Patosh, conducted in 2012, made it possible to identify the specifics of the decision-making caused by the specifics of United States small business.
1. The minimum number of participants (staff, people) entails the following features:
• a high level of personal responsibility for each individual employee, since informal connections are established between the manager and his subordinates
• In the adoption of decisions related to staff, new criteria for evaluating the candidate appear - its interaction with the team is assessed, personal antipathy;
• Direct communications allow the manager to monitor all processes in the organization, make decisions in a timely manner and sometimes ahead of time;
• personal communication with a subordinate leads to a knowledge of his personal characteristics, abilities (can he do the work);
• more personal communication with subordinates, knowledge of his problems and life situations, the appearance of an emotional component.
2. Independence (the desire for independence) determines:
• High level of responsibility;
• Striving for one-man management;
• a high degree of freedom.
3. Absence of delegation of authority is connected with:
• the desire for independence;
• High level of personal responsibility;
• constant supervision by the head of all areas of the organization;
• work without weekends and holidays & quot ;, which leads to a high level of emotional tension and burnout;
• It is possible to delegate minor authorities, the consequences of errors in which are minimal due to the impossibility of "breaking."
4. The minimum starting capital determines the following features:
• every decision in the first stages should be thought out, weighed in order not to lose those minimal development funds that are available;
• the priority is not only the material component, but also the business idea;
• When choosing between alternatives, not the best ones are chosen, but those that require the best material costs, (ie, the wrong decision is sometimes made, but the solution is sometimes to the detriment of the case);
• The high price of the errors & quot ;;
• every solution must be profitable, cost-effective;
• The role of social networks (links).
5. A certain low turnover of funds is:
• Constant budget monitoring, restrictions in unnecessary spending;
• Search for additional sources of profit;
• evaluation of the level of profit, the desire to support it.
6. The lack of support from the state leads to:
• business insecurity;
• Constant monitoring of changes in the external environment (legislation, actions of partners, etc.);
• Constantly searching for ways to protect your business;
• additional material costs (bribes, gifts, uncontrolled growth of prices for resources, etc.);
• the need to interact with officials at the informal level;
• Mistrust of the state, and, therefore, unwillingness to interact and cooperate (all done at a minimum);
• Increase the role of social capital and social networks;
• high level of uncertainty in the external environment.
7. The Soviet past defined:
• A tough business style;
• a more relaxed attitude to the crisis stages in business due to the experience of decision-making in crisis situations;
• Ability to adapt to changes in the external environment;
• having an experience that shortens the duration of the solution search;
• distrust of the state and its representatives;
• the desire to expand social networks to receive support in crisis situations.
8. Lack of knowledge, experience and skills at the stage of business formation leads to:
• making erroneous decisions;
• the constant search for information in the external environment, attempts to find new sources of knowledge;
• the role of professional experience, as well as the ability to draw the right conclusions;
• the predominance of intuitive solutions over rational ones,
• orientation on judgments, logic and intuition due to lack of experience;
• Application when solving problems of not worked algorithms, but created new ones.
9. High adaptability to the constantly changing economic and political situation is determined by:
• Constant control over external and internal processes;
• wasting time searching for information sources;
• It's a waste of time to find ways to adapt to changes;
• Resource (including material) costs of adaptation;
• Using familiar problem solving algorithms for similar situations to reduce resource costs.
10. Search and verification of reliable information about the state and position of the market assumes:
• use only a piece of information, which leads to hasty and erroneous conclusions, as many other alternatives are excluded;
• waste of resources (time, personnel, costs, etc.);
• The need for analytical processing and experience for sifting information.
11. The absence of a culture of doing business stipulates:
• high level of uncertainty;
• Mistrust of partners and, therefore, the need for continuous verification;
• the desire to expand social networks, and links with people to back up with material values.
The environment in which a decision is made in business can be characterized by the following parameters: uncertainty, complexity and dynamism. Uncertainty is related to the information component of the decision-making process and can be caused by two conflicting parameters - information deficit and information redundancy.
Uncertainty conditions are especially difficult to find optimal solutions. In this regard, at the end of the XX century. the idea of advanced control was put forward. This term is used to describe a number of analytical methods for eliminating the uncertainty faced by businessmen. Advance management is based on a causal analysis, consisting of seven main steps: the formulation of the problem; description of the problem; Identify the differences that cause the problem; Identification of the changes causing the problem; identification of probable causes; checking the most likely causes; confirmation of the most probable cause.
The problem of finding solutions in conditions of uncertainty is of great importance for the development of modern methods of business management. Today it is often possible to hear that the uncertainty is growing (especially often talked about this in relation to our country) and creates new risk factors. If we do not address the problem of stability in the legislative sphere, then it is quite difficult to agree with this completely, because even in stable countries many important transactions are made in conditions that are difficult to control and predict. It is possible to note only the relative difference in conditions in different countries and in relation to various spheres of business. There are more risky spheres of business in comparison with less risky spheres. This is evident in almost all countries.
Complexity decision environment is expressed in a large number of factors that need to be considered. These factors are often located with each other in close interrelated relationship. External factors (economic, socio-demographic, scientific, technical, political and other factors of the external environment of the organization), as well as internal ones (features of corporate culture, management style, personnel motivation systems, etc.) can act as such factors.
The dynamic environment is associated with high variability of external and internal factors of the organizational environment. Also, the dynamic nature of the environment is due to time constraints in the implementation of decisions.
Dedicated three parameters of the environment act together, in a complex, although in different combinations, which further complicates the decision-making process in business. For a visual representation of the decision making environment, use the so-called Howard Cube (Figure 2.2).
Fig. 2.2. The Howard Cube: 1 - degree of difficulty; 2 - the degree of dynamics;
3 - degree of uncertainty
No less critical for the solution is the human factor. An example of the analysis of the role of the human factor in decision-making is the concept of "limited rationality" G. Simon, who outlined the following decision parameters related to individual psychology -
remove the features of people that limit the rational decision-making.
1. The person in making decisions simplifies the situation and is not able to take into account the existence of some alternatives or their consequences.
2. In making decisions, people proceed from the subjective value of an alternative, called utility.
3. When assessing the subjective probability of the onset of any consequences of the decision, people tend to overestimate the likelihood of unlikely events and at the same time underestimate the likelihood of the most plausible consequences.
4. When choosing alternatives related to risk, people base their decisions on maximizing the linear combination of utility and the subjective probability of obtaining it.
5. When making decisions, a person strives not to maximize, but to find good or acceptable solutions in these specific conditions, taking into account his traditions and decision-making algorithms. That is, determining in the decision-making process are certain personal qualities of a person, rather than the desire to maximize some criterion.
Considering the influence of personal qualities on decision-making, it is also necessary to consider the problem of confidence and uncertainty when making a decision in a risk environment. This is important to know in order to assess the possibility of implementing decisions, consequences and prospects.
Confidence is characterized by knowledge of all evaluated alternatives and external factors associated with each alternative. The solution in this case requires the collection, accurate use, measurement and evaluation of information reliability.
Under the influence of risk conditions, the businessman knows about all the evaluated alternatives, but does not know what will happen if he chooses some alternative, i.e. the result may be unexpected. In this case, it is necessary to collect as much information as possible to calculate as accurately as possible the result of taking each alternative and possible losses in case of a negative result.
In a situation of uncertainty , the businessman does not know all possible directions of action. Situations can be unexpected, the results are poorly predictable. Therefore, in the situation of high level of uncertainty, it is necessary to gather as much information as possible, perhaps even in the form of research and be ready for a creative solution to all subsequent problems.
Various variants of uncertainty conditions are prescribed in many modern management textbooks, since the calculation and foresight of these conditions and their consequences are among the most important competencies of a businessman.
In Table. 2.1 are presented in general form the various variants of the uncertainty conditions with which the businessman has to work (Ivanova et al., 2008).
Table 2.1. The ratio of the content of the concepts of risk - uncertainty - confidence
Unexpectedness of all alternatives
Knowledge of all alternatives
Knowledge of all alternatives
Unexpected results even for known alternatives
Unexpected results for each alternative
Knowing the results associated with each alternative
The decision requires creativity and the will to take risks in the face of uncertainty
The solution requires knowledge, calculation for each result
The solution can be identified with the best output
In modern business, risk is being managed. This is facilitated by the development of an interdisciplinary area, such as risk management, which is related to the study of the nature, content and types of risks, risk management and financial relations arising in the process of this management.
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