Participative Decision-Making - Coursework Example

The manager’s decision-making world is most often imperfect, subject to the influences of cognitive limitations, risk and uncertainty’ – following the statement what type of decision making can be deemed to be ideal. Name Institution Professor Course Date Introduction Decision-making is one of the essential activities in firms. It is the most common form of problem-solving and an important element skill in other more complex and ill-structured forms of problem-solving. Decision-making entails a procedure of selecting a course of action for addressing an opportunity or problem. It is a reasoning process that appears to be irrational and rational and can be based on preconceptions or assumptions. Programmed and non-programmed decisions in organisations are needed from time to time to assist firms cope with varied and novel environments, and this calls for practical decision-making. Although such technological and structural shifts may be considered to be relevant to the initiators, other members of the firm particularly employees may resist these changes. A commonly accepted explanation of this occurrence puts forward that participative decision-making guarantees acceptance of change or decisions while direction or imposition by a person in authority or a manager trigger resistance. Given that managers’ decision-making world is most often imperfect, subject to influences of cognitive limitations, risk and uncertainty, this essay argues that participative decision-making is the ideal type of decision making in organisations. Participative decision-making is the ideal type of decision making as it involves superiors and their subordinates. According to Sagie, Elizur and Koslowsky (1995, p.82), participative decision-making (PDM) entails the process through which subordinates and their superiors share influence. Fields (2010, p. 370) asserts that participative decision-making is a human resource management practice that shows workers that their superiors value them. PDM offers workers indirect or direct voice in decisions and a prospect to influence others in diverse organisational levels. Fields (2010) claim that employees hold complete understanding of their work compared to their superiors. In this regard, decisions made in union with workers are made with an improved information pool (p.82). In addition, workers involved in decision-making are better equipped to execute work processes after the decisions. PDM boosts the morale of employees and lowers resistance besides reducing bias in decision-making. PDM brings in a pool of ideas and information. It entails a firm’s managers consulting their subordinates and sharing the underlying principle for decisions. Participative decision-making type reduces the influences of cognitive limitations of managers. According to Chelladural (2013, p.207), the benefits of allowing staff in an organisation to participate in decision-making, include higher rationality in decisions. Given that the level of engagement in participative decision-making entails members sharing perceptions, ideas and information with their managers, the cognitive limitations of the manager is addressed. In participative decision-making, the leader or manager hold access to alternative views and is well informed when making decisions. Challadural (2013, p.207) asserts that the rationality of a decision is enhanced when more members participate in decision-making. A group of people hold more insight and information compared to an individual. The deeper and wider information and expense base helps a manager in clarifying the problem and determining and evaluating other resolutions to problems (Challadural 2013, p.207). More importantly, participative decision-making allows members to understand problems and solutions more clearly. When employees are involved in decision-making, they take the decision as theirs and establish a sense of ownership. When employees feel and understand ownership of a decision, they are more probable to implement the decision more effectively and efficiently. Participative decision-making helps in addressing the influence of uncertainties in decision-making. According to Cropanzano and Kacmar (1995, p. 47), participative decision-making is likely to lower uncertainty influences of a manager’s or supervisor’s behaviour. Uncertainty in decision-making occurs when information is not sufficient or when managers hold so little ideas and information. Lack of adequate information makes it impossible for managers to assign probabilities to different options and their possible upshots. Participative decision-making brings in more ideas and information that help managers in implementing the best possible alternative to address uncertainties in decision-making. With respect to bound rationality, information is important in allowing people to evaluate alternatives (Laing 2013, p. 63). Apparently, when a single upshot is likely in time of decision-making, the decision becomes certain but when the possibility of several alternative upshots is available, the decision becomes risky. For risk decisions, numerous upshots are possible, and the likelihood of each upshot taking place is known. However, when the range of probable upshots is not recognised, and the occurrence of the different outcomes is not recognised, the decision becomes uncertain. With respect to the rational decision-making theory, a decision maker focuses on logic and facts besides assisting in guarding against unsuitable pitfalls and assumptions (Laing 2013, p. 63). Rational decision-making model ensures that the decision maker obtains perfect and complete information. Obtaining perfect and complete information calls for the participation of decision makers and people whom the decision will affect. Participative decision-making allows for the attainment of perfect and complete information that helps in eliminating uncertainty besides evaluation of all the ideas and information logically and rationally. The output of rational decision-making is to provide a decision that serves an organisation’s interests. Similarly, participative decision-making helps in producing the best decision that serves the interests of all the stakeholders in an organisation. According to Nelson, Armstrong, Condle and Quick (2010, p. 1), participative decision-making includes workers identifying problems, formulating alternatives, choosing solutions, planning executions and evaluating results. The economic theory of rational decision-making model maintains that individuals are viewed as rational actors who get involved in the procedure of optimising expected utility through choosing the highest payoff from accessible alternatives. According to Laing (2013, p. 63), rational actors engaged in participative decision-making do not inevitably evaluate all possible options. They may simply search until they find a solution that attains a certain acceptable level. Participative decision-making lowers the influences of risk in decision-making. Risk in decision exists when decision makers lack absolute certainty concerning the upshots of different courses of action, but decision makers recognise the probabilities linked to the occurrence of risks (Robbins 2009, p.250). Similar to participative decision-making, classical decision-making theory steps involves acknowledging the call for a decision, diagnosing the problem, developing alternatives, selecting alternatives, implementing alternatives and exercising follow-up and control. Through participative decision-making, decision makers gain absolute certainty regarding the upshots of each course of actions. The absolute certainty is attainable through involving employees in diagnosing problems, developing alternatives and selecting the best alternatives. Robbins (2009, p.250) asserts that participative decision-making involves employees in decision-making an aspect that allows a sense of ownership in execution and implementation. In addition, mindfulness and information flow established via participation are essential when considering means to reduce risks in decision-making. Participative decision-making improves the quality of decision-making. A decision-making procedure is initiated by a manager when he/she identifies a real problem. According to Parnell (2010, p.2325), a manager who believes that participative decision-making promotes organisational effectiveness, productivity and decision quality adopt this decision-making technique. Participation in decision-making helps in obtaining quality decisions. Although some managers believe that participative decision-making limit their power, PDM is beneficial as it helps in ensuring quality decision-making. Participative decision-making is commonly used in firms that acknowledge democracy and the value of employees. For instance, companies such as Toyota Motor and most Japanese companies use participative decision-making to empower their employees and to ensure quality decisions (Nelson 2010, p.137) . In addition, scores of U.S businesses such as Motorola have established quality circles, a group of workers who meet frequently to suggest ways of improving their organisations (Nelson 2010, p.137). Apparently, participative decision-making helps in generating more alternatives thereby allowing participants to optimise more. Participative decision-making involves higher member satisfaction and commitment to decision-making. According to Fields (2010, p.82), participation in decision making in an organisation is essential as it leads to the satisfaction of an organisation’s stakeholders. More so, employees tend to accept decisions more enthusiastically when they have participated in making the decisions. Participative decision-making allows people to understand better and be more devoted to a decision in which they are involved in making. Decisions made through the involvement of the people affected are more probable to be executed successfully. As indicated earlier, the rationality of a given decision is enhanced if more people take part in decision-making. More than one person holds more information compared to an individual. McDonnel (1976, p. 2) asserts that one of the numerous theories or techniques suggested for improving satisfaction and morale of workers is to offer them greater involvement in decision-making. Numerous studies have confirmed that increased involvement in decision-making augments organisational effectiveness; increased job satisfaction and quality of the decision. However, some employees do not like being involved in decision making as they view it as the function of managers. Eddleston, Otondo and Kellermanns (2008, p 461) confirm that participative decision making in family business augment commitment to a course of action and enhance the decision-making quality of family-owned organisations. In this regard, family-owned companies that employ highly participative decision-making process experience the greatest cognitive conflict. Such businesses experience cognitive conflict because family members are free to debate and discuss their firms’ strategies and goals. Participative decision-making promotes decision ownership and acceptance. Sagie, Elizur and Koslowsky (1995, p.84) asserts that participation in tactical decisions promotes change and decision acceptance. With respect to path-goal theory, a leader’s behaviours and decisions will be acceptable to the subordinates only to the degree to which the decisions and conducts help the subordinates attain their goals. As a result, leaders will be successful if their followers perceive them as working together with them to attain certain goals. Decisions made in an organisation can be accepted or rejected by those affected by them. However, when employees are involved in decision-making and when decisions are aimed at helping employees attain their goals, such decisions are not met with resistance (Eddleston, Otondo & Kellermanns, 2008, p 461). Although participative decision-making is slow and time-consuming, it is an effective strategy that lowers employees’ resistance to change. When participative decision-making is adopted in a firm, every employee gets a prospect to gain recognition and value, hence reducing individual resistance to change and decisions. A sense of uncertainty in decision-making is not always constant but differs with respect to the decision type and the adequacy of information. Conclusion Decision-making entails the process of selecting a course of action for addressing a given opportunity or problem. Decision-making is essential for organisational productivity and growth. There are two types of decisions which include programmed decisions and non-programmed decisions. These types of decisions require practical decision-making techniques that hold the potential to facilitate implementation and acceptance of decisions. Participative decision-making is the idea decision-making technique for both non-programmed and programmed decisions. PDM lowers the influences of cognitive limitations of managers through providing an adequate pool of information and alternatives. The deeper and wider information base helps a manager in clarifying the problem and determining and evaluating other resolutions to problems. In addition, PDM helps in lowering the influences of uncertainties in decision making through lowering the uncertainty influences of manager’s behaviours. PDM help decision makers to focus on the facts and logics provided by the participants. PDM is the idea decision-making technique because it lowers influences of risk in decision-making; improve decision quality and increase satisfaction and commitment of employees to decision-making. Participative decision-making promotes ownership and acceptance of decisions. Employees readily accept decisions that they have been involved in making. Although participative decision-making is slow and time-consuming, it is the ideal type of decision making in organisations. Reference List Chelladural, P 2013, Human resource management in sport and recreation, Human Kinetics, UK. Cropanzano, R & Kacmar, M 1995, Organisational politics, justice, and support: Managing the social climate of the workplace, Greenwood Publishing Group, UK. Eddleston, K, Otondo, R & Kellermanns, E 2008, ‘ Conflict, participative decision making and generational ownership dispersion: A Multilevel analysis’, Journal of Small Business Management, vol.46, no.3, pp.456-484. Fields, J.E 2010, ‘Participative decision making and organisational commitment’, Cross Cultural: An International Journal, vol.17, no.4, pp. 368-392. Laing, G 2013, ‘ Testing the rational decision-making model through an outsourcing task’, Journal of Applied Management Accounting Research, vol.11, no.2, pp.63-78. McDonnell, J 1976, ; Participative management: Can its acceptance be predicted’, Human Resource Management, vol.15 no.2, pp.2-4. Nelson, B 2010, Managing for dummies, John Wiley & Sons, UK. Nelson, D, Armstrong, A, Condie, J & Quick, J 2011, ORGB, Cengage Learning, USA. Parnell, J 2010, ‘ Propensity for participative decision making in Latin America: Mexico and Peru,’, The International Journal of Human Resource Management, vol.21, no.13, pp.2323-2338. Robbins, S 2009, Organisational behaviour in Southern Africa, 2nd edition, Pearson, South Africa. Sagie, A, Elizur, D & Koslowsky, M 1995, ‘Decision type, participative decision making ( PDM) and organisational behaviour: An experimental simulation’, Human Performance, vol.8, no.8, pp.81-94. Read More