Fundamentals of Management, 8th ed

F I G U R E 4 . 2

The Classical Model of Decision Making

steps in rational

decision making

Recognize and define

the decision

situation; identify

appropriate

alternatives; evaluate

each alternative in

terms of its

feasibility,

satisfactoriness, and

consequences; select

the best alternative;

implement the

chosen alternative;

and follow up and

evaluate the results

of the chosen

alternative

Chapter 4: Managing Decision Making

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locations. AT&T spent over a year searching before selecting the Dallas–Fort Worth

area for its new corporate headquarters. If the problem is to choose a color

for the company softball team’s uniforms, less time and expertise will be brought to

bear.

Although managers should seek creative solutions, they must also recognize that vari-

ous constraints often limit their alternatives. Common constraints include legal restric-

tions, moral and ethical norms, authority constraints, available technology, economic

considerations, and unofficial social norms. Boeing and Airbus identified three different

alternatives to address the decision situation of increasing international airline travel

capacity: They could independently develop new large planes, they could collaborate in

Table 4.1

Steps in the Rational Decision-Making Process