The Rational Decision-Making Model


The rational decision-making model provides a structured and reasonable approach to deciding within an organizational setting. By choosing to make decisions rationally, the model equips decision makers with specific knowledge regarding available options. Being a multistage process, this model favors logic, objectivity, and analysis over insight and subjectivity (Betsch & Haberstroh, 2014). Under this model, decision-makers can maximize benefits or minimize costs. For instance, when purchasing a useful product, people often compare its price to that of a similar item in determining its value. Most often individuals opt for the item that offers the highest value at the lowest cost. Moreover, the rational decision-making model attaches no importance to unquantifiable factors such as ethics or altruism (Gigerenzer, 2015).  It completely ignores loyalties, obligations, or personal feelings. Due to its reliance on objectivity, the model is biased towards facts, data, and analysis of desire or intuition (Calabretta, Gemser, & Wijnberg, 2017). This essay will highlight will critically evaluate the value of the ‘rational’ model in explaining how decision-making takes place in organizations by using other approaches to decision making. The other decision-making approaches that will be sued to understand the value of rationality model include the administrative, retrospective, and political decision-making models. 

The Rational Decision-Making Process

The rational decision-making model is characterized by logic, and that is why it is a multi-step process. In this model, problems are solved in a rational way beginning from problem identification to the actual solution to the problems (Noorani, 2010). Decisions are based on a careful analysis of the available facts. The following are the six major steps involved in a rational decision-making process:

Identification and Definition of the Problem

This is the first step in rational decision-making, and it involves identification and description of the problem at hand. Also, the current and desired states are defined at this stage. It is important to point out that there is less focus on determining the symptom of a problem as the decision maker is concerned about actual cause of the problem. According to Noorani (2010), the gap between the desired state and the current state is also defined at this state as a way of motivating the people involved when it comes to the implementation of the final decision. Furthermore, the individuals in the decision-making process do not consider coming up with quick solutions but take time to define all the available alternatives. The six major steps involved in this process include: 

Identification of the Decision-making Criteria

At this stage, all the criteria for making the final decision are outlined to serve as a perfect guide when it comes to decision-making (Verma, 2014). The decision making criteria is identified ahead of time to guarantee a systematic process. 

Weighing the Criteria

The third step involves weighing the criteria the established in step two. The process is meant to establish the level of importance of each criterion. Weighting methods such as absolute comparison and the relative comparisons methods are normally applied when it comes to rating each decision-making criterion outlined in step two(Verma, 2014). The absolute comparison method involves the use of a rating system to determine the importance of each criterion while the relative criterion method involves comparing the outlined criterion with each other. The most important criteria are then used as a guide for making the final decision. 

Generating the list of alternatives

A list of alternatives is normally generated after identification of the most important decision-making criteria. The decision-makers are expected to come up with a list containing alternative solutions to the problem to increase the chances of coming up with the most effective solution (Turpin & Marais, 2004). The process of generating alternative solutions is made simple when there is a proper weighting of the decision-making criteria. At this stage, one is allowed to come up with all types of solutions including those that might be considered as bad solutions because all of them are evaluated in the next step. 

Evaluating the Alternatives

The criteria in step 2 are normally used to evaluate the alternative solutions suggested in step four.  Turpin and Marais (2004) observe that this is the most involving process as one has to evaluate all the alternative solutions based on all the outlined criteria. The number of alternatives and criteria determine how long it takes to complete the evaluation process. 

Determining the optimal decision 

This is the sixth and final step when it comes to the rational decision-making process where the optimal decision is selected after a thorough evaluation of all the possible alternatives (Spencer, 2014). The respective weight of each criterion is used to determine the level of influence associated with each decision.

Comparing other Approaches to Decision Making with the Rational Model

It is difficult to understand the value of the rational decision-making model without discussing other decision making approaches in relation to the model. The following are some of the decision-making approaches that can help in determining the value of the rational decision-making approach.

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The Administrative Model in Relation Rationality Approach

The main focus of this decision-making approach is the achievement of the set goals. Griffin (2007) observes that the approach does not focus on the evaluation of alternative courses of action as it always the case in the rationality model. In the rationality model, the available alternatives for reaching the set goals must be understood before the final decision is made.  However, decisions made using the administrative model are based on individual rationality. The administrative model is considered as a more realistic decision-making mode for organizations, and has a slight departure from the rationality model (Griffin 2007). In this case, the model suggests that decision-makers can find acceptable solutions using shortcuts.This is nromally applied in instances when decisions are supposed to be made within the shortest time possible. The administrative model perceives that the decision-makers that are faced with many demands and have different levels of motivation. According to Griffin (2007), the main motivation behind this model is to satisfy and a not to optimize. On the other hand, a solution with the highest value is considered when it comes to the optimization approach that is applied in the rationality model. The sacrificing approach adopted in the administrative model is only concerned with finding a solution with an acceptable value.  

In this model, a decision is measured against a given constraint to determine whether it is acceptable or not. The administrative model is also referred to as a bounded rationality model because it applies a rational strategy when there is no time to consider other alternatives. The satisficing approach is based on the argument that cost of the expected payoff should be measured against the cost delaying a particular decision (Chand, 2017). In this case, the cost of delaying a decision is considered when determining whether a strategy is appropriate or not.  Under the administrative model, an acceptable solution to a problem is officially turned into a standard operating procedure for use when a similar problem or arises in the future. Also, it is assumed that people may not pursue the best solution because such solution demands greater processing capabilities, time, and information (Chand, 2017). Hence, they end up considering limited or bounded rationality in coming up with acceptable solutions. Apart from the satisficing concept, the two other concepts that are normally applied in this approach include the heuristic concept and sequential attention to an alternative solution.  

The heuristic concept includes the assumptions that are used to come up with an alternative that has high chances of being accepted. Moreover, Chand (2017) argues that the sequential attention to alternative solution means that once an acceptable solution has been found from a sequential examination of each potential solution, the search process stops. It is difficult to view an organization as a single entity when the decision makers are rationally bounded. Each unit or department within an organization is expected to come up with its goals and priorities once the problem has been broken down. The goals at the specialized unit level may not agree with the overall organizational goals but are considered valid as long they appear to be rational at that level (Chand 2017; Verma, 2014). Each specialized unit tends to view different perceptions of uncertainty, information, and priorities and in the process enhancing divergences. Such tendencies may lead to conflicting interests and organized anarchy when they are not brought under control. 

The administrative model takes a simplistic approach in decision making by depicting objective rationality. According to Chand (2017), the decision-maker only considers the most critical and relevant factors when making a decision and does not need to know the advantage and disadvantages of all the potential solutions. In most instances, small groups or individuals within an organization are involved in making a strategic decision for an organization. Also, the interests of the entire organization must be considered when making a decision using the administrative model. Chand (2017) suggests that organizations have competing stakeholders, and the interests of each stakeholder must be put into consideration when making a decision. As mentioned earlier, a solution is considered rational when it is acceptable to all the stakeholders. Turpin and Marais, (2004) are of the opinion that the decision maker’s altruism, wisdom, and skill determine the effectiveness of the administrative model of decision-making. The final decision resulting from this model may be of low quality as comapred to the rationality model, but it is suitable instances where there is limited time or time is costly. 

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Retrospective decision Model in Relation to the Rationality Approach

In this case, the main focus is on the justification made by decision-makers after they have made a particular decision (Chand 2017). The difference between this model and the rationality model is that the decision-makers tend to rationalize a decision after it has been made. In other words, the most preferred alternative is identified as early as possible, while the rest of the process involves justification. Decisions are made based on intuition followed by the use of scientific method to justify the selected alternative (Chand 2017). In this case, the decision maker is convinced that their decision is reasoned, logical, and rational. The main difference between this model and other types of decision-making models is that it can only be used by individuals. The model is also referred to as the implicit favorite model where the decision-maker’s favorite alternative or approach is given priority. The decision maker does care about the other alternatives but only goes for what they like. Rational thought is completely ignored when coming up with a decision but may be considered when justifying a decision that has already been made (Turpin & Marais, 2004. The main shortcoming of the model is that biases can make one settle on an alternative that has less value to the organization. 

Political or Incremental Model in Relation to the Rationality Approach

The political model of decision-making focuses on many inter-organizational problems and not a single issue. The combined issues facing different units of the organization for the personal goals and that is why the approach is also referred to as an incremental model (Yang, 2003). In this case, the existing routines, programs, and standard operating procedures form the basis of political decision making. The political model emphasizes on the natural multiplicity of interest, values, and goals (Beach & ‎Connolly, 2005). In addition, the different coalitions with an organization have to engage in bargaining in order to come up with final decision on different issues. The decision making power in political model is decentralized, and this is quite different from other decision making models like the rationality model. Yang (2003) observes that the existing policies are considered when policy changes are required to solve a particular problem. The incremental nature of this model means that managers with an organization are allowed to make slight changes to the existing policy in response to the problem at hand. There is a need to come up with a comprehensive program or a new set of plans when responding to a problem. In this case, the decision maker does not spend a lot of time in defining problems or searching for information. Verma (2014) observes that instead of coming up with a superior alternative like in the rationality model, the political model ends up only addressing the existing weakness or shortcoming in the current policy based on incremental decision making. The stakeholders in a political model may have divergent solutions, priorities and perception making it difficult to come up an objectively optimal decision like in the rationality model. 

Critical Analysis of the Rational Decision-Making

The dynamic and complex nature of the modern managerial environment calls for rational decision making to achieve the expected outcomes. Rational thinking is the only way to come up with appropriate solutions to complex situations in an organizational setting. Crozier et al. (2002) observe that most organizational problems and challenges can no longer be solved by the rule of thumb or heuristics, and that is why rational decision making has remained as the only model that can guarantee optimal solutions. In this case, irrationality seems to be untenable while rationality is no longer negotiable. In addition, the rationality approach takes a traditional approach when it comes to understanding the decision-making process. The models provide an ideal decision making procedure for the overall managerial frontier instead of just focusing on the practicing managers (Turpin & Marais, 2004; Gigerenzer, 2008). The model is based on the assumption that the managers will engage in a sequential decision-making process because they are rational. 

Moreover, the rationality model provides managers with an opportunity to review or evaluate the merits and demerits of each possible solution for a problem. As a result, an organization can settle on a solution that guarantees optimal outcomes. Effective decision making cannot take place without the problem recognition stage. It is important to define a particular issue or phenomenon in the right perspective, and this can only be achieved through problem recognition (Shapira, 2002). According to Sternberg (2009), an empirical analysis of all the alternatives means that the final decision matches the original problem. Furthermore, the scientifically obtain data that is normally used to evaluate alternative solutions leads to informed decisions. The use of scientific data reduces chances of inequitable judgments, assumptions, distortions, errors, and subjectivity in decision-making (Turpin & Marais, 2004). The decision-making process is in most cases characterized by uncertainty, but the rationality model guarantees high-quality decision and promotes consistency in decision-making processes. Also, the rationality model is knowledge-based, and this helps when it comes to infusing logic, discipline, and consistency in decision-making. 

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However, it is important to point out that this model has its weaknesses or problems just like other decision-making models. To begin with, the model has simplistic assumptions that may not be realistic in practical situations. The model assumes that all decision-makers are rational, but this is not always the case because some of them are always innate vices that might hinder rational thinking (Gigerenzer, 2008). It is very difficult to find a decision maker that appears to be totally rational considering the biased nature of most human beings. Rational decision making may be difficult for some managers due to time constraints, groupthink, a low degree of competence as well as the emotional makeup. As a result, there are some instances where resources are wasted and mistakes made when trying to come up with a solution that may not add any value to the organization. Furthermore, the model is limited in its application by deficiencies in perfect knowledge, limits on individual rationality, behavioral variations, personal preferences, and time constraints (Ureña et al., 2015).  

Despite the few shortcomings associated with the rationality model, it is important to point out that is more valuable than other models because it guarantees accurate and well-researched decisions. The best solutions within an organization should result from rational thinking and not emotion to avoid costly biases (Hardman, 2009; Nutt & ‎Wilson, 2010). Managers have a perfect framework to engage in empirical decision –making when they adopt the rationality model. Decisions should be made based on information and knowledge for them to add value to an organization. 

The Value of Rationality Model for Decision Makers

In rational decision-making, the model offers value to decision-makers in several ways. First, decision-makers can make rational decisions by relying on rational procedures. Under most scenarios, however, this does not lead automatically to a rational choice. Second, the model’s distinction between objective and subjective knowledge influences the decision-making process. For example, managers have to contend with balancing between tradeoffs and alternatives assuming that a decision maker’s norms and values are known beforehand (Pettigrew, 2014). Third, the rational decision-making model is regarded as a normative one as it leads to significant improvements in real-world decision-making scenarios over other decision-making models (Burkhardt, Smith-Coggins, & Santen, 2016). Finally, knowledge-based decision making process guarantees consistency and predictability in the decision-making process.  


It is quite evident from this discussion that the rationality model guarantees the most optimal decisions when compared to other decision-making approaches. The model is logical and knowledge-based, and therefore leaves little room for biases and errors. Other approaches focus on the final goals, but the rationality model is concerned about the process of achieving the final goals, the accuracy of decisions, and value of decisions to the organization. However, organizations should train its managers on how to use this model to guarantee optimal outcomes.  

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