Eternal and Internal Factors That Influence the Decision-Making, a Decision Matrix - Term Paper Example

Executive summary This report looks at factors that influence the decisions made by individuals. Some of these factors are internal while others are eternal. Internal factors include individuals’ perception, learning and motivation while the external factors include family background and culture. The report also looks at decision making while choosing the means of acquiring accommodation and the factors to consider. This decision is reached at using a decision matrix where accommodation options are being evaluated with five evaluative criteria. The accommodation options includes renting a three bedroom ocean view apartment in Bondi in Sydney (rather than just saying renting an apartment in general); sharing a two bedroom townhouse with a TAFE student near the Brisbane CBD; buying a three bedroom bush land house under Mount Archer in Rockhampton, Going for the accommodation offered by the university, Commuting from my home 7 kilometers from the university and Staying with a relative and his family in Sydney in a two rooms house. This is evaluated with criteria that include prices, distance from the university, accessibility to public transportation, safety/security, and the status of housemates. After making my personal decision matrix, I gave it to two other correspondents who had different opinions regarding the type of accommodation they would go for. This is however explained by Compensatory decision rule which is used to evaluate alternatives where consumers consider a certain product depending on how it performs on relevant attributes and also the importance of respective attributes. This rule allows for compensation of a negative evaluation on one attribute for a positive evaluation on another attribute. Table of Contents Creation of decision matrix 5 Application of compensatory decision rule 7 Analysis of choices 12 Conclusion 13 Works Cited 14 Decision making Introduction On daily basis, people are faced with decisions some which are small while others are big. However, people arrive at their decisions in different ways depending on various factors. Some of the factors that influence decision making include internal and external influences. Decision making process is also faced with many competing forces. For example a decision on the type of accommodation to go for can be determined by many factors such as security, cost of buying versus cost of renting, accessibility and social amenities among others. Factors that impacts decision making Internal influences One of the internal factors that affects decision making is an individual’s perception. Perception is a process by which individuals organize and interpret their cognitive impressions to apply the meaning to their environment. Every individual has a perception on what reality is and not what is reality itself. These individuals also base their behavior on those perceptions because the world that they perceive is behaviorally important to them. Perception is influenced by the attitudes, interests, experiences and expectations of the perceiver, the target and the situation in terms of time, social situation and work setting. Attribution Theory explains perception that when individuals observe a certain behavior, they personally try to determine whether that behavior is internally or externally caused. Internally caused behavior is one under the personal control of the individual while externally caused where the outside forces force one to behave in a particular manner (Schkade & Johnson, p220). Another internal influence of decision making is learning. Learning involves use of concepts that have been taught either at home by the parents or in school by the teachers. As we grow up, these two people influence how we do so many things. One can therefore make a decision depending on what was taught to him or her by the teacher or the parents. For example, a decision that may involve considering the costs, one may use economic concepts taught by the teachers to reach a certain economically effective decision. One can also learn from what the parents have done in the past. For example on making a decision on accommodation, one can consider how the parents went about and if it worked well, the same decision can also be adopted (Hess, Queen, & Patterson, p35). The other internal influence on decision making is motivation. Motivation is explained by expectancy theory that a person may decide to act in a certain manner because they are motivated to select that behavior over others because of the results they expect form that behavior. In other words, motivation to make a certain decision is influenced by the expected outcomes (Deci, p110). Therefore decision making based on motivation focuses on the expected results. For example when making a decision on acquiring accommodation, one may consider the accruing benefits of fore example buying a house or renting it. Benefits such as good infrastructure, security and financial gains may be some of the outcomes that may drive one into making a decision of buying a house rather than renting. External influences Some of the external factors that may affect decision making include family and culture. May aspects such as size of the family and the attachment in the family may have an impact on how individuals reach certain decisions. For example when making decisions on the type of accommodation, one should consider the size of the family that is intended to occupy the house either the present family size or the intended size. The attachment with other family members may also affect decision making since some people cannot reach a decision without the approval of the family members. Some people may believe that before they settle for a certain decision, their parents and siblings must approve it. This may sometimes delay the decision making process or may land the individual into what is not pleasing to him or her. It iis however important to consult the family members but this should depend on their level of knowledge and their interests. Not everyone may be able to understand the factors that one considers when making a decision and it is therefore important to consult those who can understand. Culture is another factor that may impact on one’s decision making. Some people make decision depending on what has been the trend. Certain cultures have their own ways of doing things. This includes their ways of acquiring housing and also the places they can acquire the housing. Some cultures do not allow people to settle away from their ancestral lands and this may influence a person’s decision on where to acquire accommodation. Such a culture may only allow one to rent a house in a different place but not to purchase (Wright, Cohen, & Caroselli, 63-64). Decision making while choosing accommodation Creation of decision matrix A decision matrix is a table used in evaluating possible alternatives to a course of action. The alternatives are put in one column while the relevant evaluative criteria is listed in the subsequent headings. Each alternative is awarded a score on a scale depending on the perceived value of the alternative under each criterion (Byrne & Clore, p119). Price Safety Distance from the school Accessibility to public transport State of housemates (age and gender) Total Renting a three bedroom ocean view apartment in Bondi in Sydney 3 7 3 7 9 29 Sharing a two bedroom townhouse with a TAFE student near the Brisbane CBD 9 8 6 9 7 39 Buying a three bedroom Bushland house under Mount Archer in Rockhampton 7 8 4 9 9 37 Going for the accommodation offered by the university 9 9 9 9 6 42 Commuting from my home 7 kilometers from the university 9 3 2 3 9 26 Staying with a relative and his family in Sydney in a two rooms house 9 3 3 7 3 25 Weight 4 5 5 4 3 Application of compensatory decision rule Compensatory decision rule is a decision rule use to evaluate alternatives where consumers consider a certain product depending on how it performs on relevant attributes and also the importance of respective attributes. This rule allows for compensation of a negative evaluation on one attribute for a positive evaluation on another attribute (Dieckmann, Dippold, & Dietrich, 200-213). According to my options analysis, I gave much weight into going for the accommodation offered by the university. This was compelling in all ways starting from the price as it is offered in a standardized price, the security is adequately provided, and there is no use of public transport. However, the only concern was the status of the house mates mainly in terms of age. This is because the rooms offered by the university are shared and one may find that the roommates are of lower level or higher. There may therefore be problem in interacting with roommates of a different level but this takes a short while to adjust and live together. Applying the compensatory decision rule, the negative evaluation of the status of the housemates was compensated with the cost of that particular accommodation and also the security which according to me have a lot of weight. Other people’s opinions After presenting my decision matrix to two of my friends, they differed with my choice. One of the gave much weight to Renting a three bedroom ocean view apartment in Bondi in Sydney while the other one choose Commuting from my home 7 kilometers from the university. However, the two had different background from mine. The one who choose Renting a three bedroom ocean view apartment in Bondi in Sydney is a part time student who works in Sydney. He also owns a car that he uses for his personal transport. Working in Sydney means that he can afford to pay the rent so price is not a problem to him. Then owning a car can enable him to commute from Sydney in the evening after work to attend to his classes in the university. Below is his decision matrix. Price Safety Distance from the school Accessibility to public transport State of housemates (age and gender) Total Renting a three bedroom ocean view apartment in Bondi in Sydney 9 8 8 7 9 41 Sharing a two bedroom townhouse with a TAFE student near the Brisbane CBD 9 8 6 3 3 29 Buying a three bedroom Bushland house under Mount Archer in Rockhampton 3 8 9 9 9 38 Going for the accommodation offered by the university 9 9 3 3 3 27 Commuting from my home 7 kilometers from the university 9 3 2 3 9 26 Staying with a relative and his family in Sydney in a two rooms house 9 3 3 7 3 25 Weight 4 5 5 4 3 The other respondent who chose commuting from home is a fulltime student whose family lives two kilometers from the university. His father is a lecturer in the university and so he lives in the nearby. Commuting from home is therefore possible for this person since his home is not far from the university. The father also owns a car and he could therefore travel with him if they are coming to the university at the same time. This person therefore stands better chances of commuting from his home to the university. His classes also do not start very early in the morning and he will therefore have adequate time to leave his home and attend the classes without getting late. Below is his decision matrix: Price Safety Distance from the school Accessibility to public transport State of housemates (age and gender) Total Renting a three bedroom ocean view apartment in Bondi in Sydney 3 7 3 7 9 29 Sharing a two bedroom townhouse with a TAFE student near the Brisbane CBD 3 5 6 9 7 30 Buying a three bedroom Bushland house under Mount Archer in Rockhampton 3 8 4 9 9 33 Going for the accommodation offered by the university 9 9 9 9 3 39 Commuting from my home 7 kilometers from the university 9 9 9 8 9 44 Staying with a relative and his family in Sydney in a two rooms house 3 3 3 7 3 29 Weight 3 5 5 5 4 Analysis of choices The first respond gave much weight on safety and distance to school and eventually chose renting a three bedroom ocean view apartment in Bondi in Sydney. Some demographic factors prompted his decision. These include age, economic status and family status (Thompson, pp15). Considering his age, he was above the age of most students in the university and could have therefore not considered going for accommodation offered in the university which is usually shared. His age could also not have allowed him to go for sharing a two bedroom townhouse with a TAFE student near the Brisbane CBD. Considering his family status, he was a father of one child and lived with his family. He could have therefore preferred renting a house that will also house his family. On the economic status, he was doing a well paying job in Sydney and this could enable him rent a house of his choice. Basically, the economic status determines areas where people seek accommodation and also the type of accommodation. Applying the compensatory decision rule, the negative evaluation of the price of renting a house could be compensated by consideration of the location of his job and also the comfort of his family Elrod, Johnson, & White, p1-19). The choice made by the second respondent was determine mainly by age and family status. He is a young man of the common age of students who was still living with his parents. His family status also allowed him to make the choice of commuting from home since it was not very far from the university. His father was also a lecturer in the university who owned a car. Therefore accessibility to public transport was not a concern for him. Two kilometers away from the university is also not a long distance and one can walk to the institution. Gender also has an impact on the choice of accommodation made by this respondent. Most females like living far from their parents as compared to males. This is because females like being independent earlier that their male siblings. A female would have preferred staying in the accommodation offered by the university rather than commuting from home. However, parents on the other hand are reluctant to let the daughters leave the home as compared to their sons (Sanz, Lizarraga, & Sanz, 387). Conclusion Decision making is a process that requires careful consideration of options and weighing the options before one comes into a conclusion. A decision matrix is therefore a very important tool for comparing options and reaching a sound decision. There are however so many factors that determine the choices made. For example when making a decision on the choice of accommodation, so many factors come into play such as security, price, distance and accessibility among others. However, the decision reached is impacted on by demographics and personal characteristics of an individual. Works Cited Wright, F., Cohen, S. and Caroselli, C. Diverse decisions. How culture affects ethical decision making. Critical care nursing clinics in nort America. 1997 vol 9(1):63-64. Thompson, P., The importance of knowing about the choice of accommodation directions. National Assistance Act 1948, vol 5 issues 2. Hess, T., Queen, T. and Patterson, T. To deliberate or not to deliberate: Interactions between age, task characteristics, and cognitive activity on decision making. Journal of behavioral decision making. 2010, Volume 25, Issue 1, pages 29–40. Byrne, D. and Clore, G. L. A reinforcement model of evaluative processes, Personality: An International Journal , 1970, vol1, 103-28. Deci, E. Effects of externally mediated rewards on intrinsic motivation. Journal of Personality and Social Psychology, 1971, vol18, 105-115. Sanz, M., Lizarraga, A. and Sanz, M., Factors that affect decision making: gender and age differences. International Journal of Psychology and Psychological therapy, 2007, vol 7 (3): 381-391. Dieckmann, A., Dippold, K. and Dietrich, H. Compensatory versus noncompensatory models for predicting consumer preferences. Journal of judgment and Decision Making 2009, vol 4(3):200-213. Schkade, D., and Johnson, E. Cognitive processes in preference reversals. Organizational behavior & Human Decision Processes, 44(2):203-231. Elrod, T., Johnson, R. and White, J. A new integrated model of noncompensatory and compensatory decision strategies. Organizational behavior & Human Decision Processes,vol 95, 1-19. Read More