Sample Business Paper on Decisions under Multiple Objectives

Decisions under Multiple Objectives

Q1. In what circumstances is the recognition heuristic likely to work well?

Many decisions that individuals make entail multiple objectives. Heuristics are decisions made using approximate methods depending on the environmental conditions. The recognition of heuristics usually creates numerous testable predictions concerning recognition and its utilization in decision-making. This type of heuristics is quite useful when making decision about two options. For instance, when making choices on two products where one product is more recognizable than the other, the decision maker tends to choose the most recognizable product over the least recognizable product.

The recognition heuristic is likely to work excellent where choices are made through ranking objects. For instance, if an individual is asked about the most popular car among Toyota, Buick, and Porsche, he/she is likely to mention Toyota, since most vehicles on the road are Toyota while other brands are not well known. This also implies that Toyota brand is economical and affordable, hence, more popular than other brands. The value of the recognition cue at different tasks also makes recognition heuristic work well because it makes other characteristics of an object seem to be unimportant.

Q2. How can a manager apply each of the following strategies to choose computer, and the advantages and disadvantages of using such strategies?

  • Lexicographic: This type of strategy focuses on minimizing a disagreement about an object. In this strategy, the manager has to rank the attributes according to their importance. The manager identifies the most essential feature in an object and selects an alternative that seems to be the best on that feature. For instance, if the manager is looking for speed, he may go for AR52, despite its price. The advantage of lexicographic strategy is that in the event of a tie on the best attribute, the manager can select the option that works out best according to the second most important feature. The disadvantage of lexicographic strategy is that the manager may select an option that works less well according to the most important attribute due to excellent performance from other features.
  • Semi-lexicographic: This strategy differentiates from the lexicographic strategy when the performance of the alternatives in a given attribute is similar. When looking for print quality, several models depict same level in quality. In this case, the manager can look for the prices to make an appropriate choice. The advantage of this strategy is that the manager is not restricted to make a second choice if the first choice does not please him. The disadvantage of semi-lexicographic strategy is that it contradicts the mode of making choices. According to Goodwin and Wright (2014), having such set of choices is contradictory because it infringe the critical axiom of transitivity, which asserts that if a person selects choice A over B, and then leave choice B for a third choice C, then he/she has to prefer choice A to C.
  • Elimination by aspects: In this strategy, the most important attribute defines the borders, where the satisfactory performance on the attribute is then recognized.The manager may opt to choose a computer whose printing speed is not below 7ppm and not exceeding $170. Thus, he would choose Symbol, whose speed is within his range and high quality print. The advantage of elimination is that the decision maker can have fewer alternatives to consider after eliminating several features. However, the strategy does not guarantee that the remaining options are better than those that are done away with.
  • Satisficing: This is a sequential decision-making process where the manager can stop searching for the best option after recognizing the best alternative. Aspiration level is the most important aspect in satisficing strategy, as the manager can make choices depending on location, prestige, and expectations. The advantage of satisficing strategy is that it allows the manager to exercise his aspirations rather than going with what other people believe is the best choice. One of the disadvantages of satisficing is that the manger can change his/her aspiration level while making choices, as expectations may rise during the selection process. For instance, the manager can opt to choose the solar computer due to its speed, but later realize that its noise level is quite high.

Q3. Which is the best holiday option, and what are the limitations of the strategy adopted to reach the appropriate option?

While choosing the appropriate option for a holiday, a student can apply elimination-by-aspect strategy, which would enable him/her to fit his/her bill and still get the best option. Out of the list of holiday options that the travel agent offered to the student, the best holiday option is California because it met all his/her minimum requirement. This choice offered almost half of the amount that the student had planned for the holiday, and extra four days. However, the student’s choice has some limitations because it would not allow him/her to get the best options. The strategy tends to focus much on the price, rather than the quality of services offered by each alternative. Narrowing the choices may end up eliminating choices that are quite superior, as the strategy is non-compensatory. The student has to focus on each attribute at a time instead of having a trade-off between numerous attributes. In addition, the choices do not offer the distance at which the student has to travel to reach the holiday destination, hence, he/she might ends up spending more on transport than the holiday.

References

Goodwin, P., & Wright, G. (2014). Decision analysis for management judgment. Chichester, West Sussex : Wiley.