Teams spend much of their time reviewing and acting on problems they face. As such, it is common to hear some teams spoken of as decisive. It is also common to hear other teams spoken of as wishy-washy. That is why your team's chances for success are helped if you can make the right decisions in the areas you control and submit sound recommendations when requested by your boss (Hersey and Blanchard, 1988).

To be an effective member of a team it is critical to understand the team decision making process. The satisfactory team decision process is characterized by a large number of inputs from each individual member upon which other members may build. It is therefore a series of interrelated sub-decisions leading to a final overall decision (Hirokawa, 1992).

The advantages of group decision making versus individual decision making are:

The team's closeness to the problem.

The larger number of ideas generated due to brainstorming.

The team's ability to build upon and thereby modify a singular solution (Higgins, 1991).

Decision making in an organization seems to occur according to two principal models: the classical and the behavioral. Fundamental differences: The classical decision theory model revolves around a highly rational, systematic, and comprehensive perspective. The behavioral theory of decision making focuses a more realistic and workable approach on the psychological and interpersonal aspects of decision making (Higgins, 1991).

The classical model was for many years believed to be the way decisions were actually made. However, more recent studies of decision making show that the behavioral approach is the more realistic of the two. People do not always make decisions in a strictly rational manner. Psychological and interpersonal factors greatly affect the process.

Classical decision theory assumes that decision making is (or should be) a rational process whereby decision makers seek out and choose the course of action that is most likely to maximize the attainment of their goals and objectives. According to the classical theory, the decision-making process can be broken down into a series of sequential steps.

Discern a Problem or Opportunity. The decision-making process can begin either of two ways. First, a decision maker may perceive the existence of a problem Æ something that is not going well and that requires action. For example, a golf course superintendent may notice that absenteeism and turnover among the employees have been steadily increasing to the point that adequate staff are not always available to complete work assignments on schedule and productivity is declining. A second possible trigger to the decision-making process is the perception of a unique opportunity that may have presented itself and that should be taken advantage of. For example, a country club manager may discover that a neighboring beach club is planning to close, opening up opportunities for the manager's organization to expand its own operations in that location. It is the perception of problems and opportunities, not their actual existence, that gets the decision-making process started. Problems and opportunities may exist all around us, but if they are not perceived and noticed, they do not initiate the decision-making process.

Formulate Goals and Objectives. Once a problem or opportunity has been identified, the decision maker must clearly identify the goals and objectives that a good decision should achieve. For example, if a golf professional is experiencing a lack of satisfaction and fulfillment with his or her current job, the pro's goals for the decision-making process might be to identify, obtain, and accept a new job that is most likely to maximize his or her future satisfaction, development, and feelings of accomplishment at another club or resort. The golf superintendent concerned about declining productivity and increased turnover might set goals of identifying and implementing changes in the work system that are most likely to result in increased productivity and reduced employee turnover.

Produce Alternatives. Once goals and objectives have been set, the decision maker then generates alternative courses of action that might result in goal attainment. This is the stage in the decision-making process that requires the greatest component of creativity and imagination. Ideally, the decision maker should seek to generate as many alternatives as possible and should try to ensure that the set of alternatives is relatively diverse. In this way the decision maker increases the likelihood that some good potential alternatives will not be excluded from further consideration in the decision-making process. For example, the golf superintendent concerned about high rates of absenteeism and turnover should consider changing the pay and reward systems, changing the design of work for employees, changing the leadership styles of supervisors, changing the methods of work assignments and scheduling, and so on. Restricting the consideration of alternatives to changes in the pay system, for example, might result in many potentially effective courses of action not being considered in the decision-making process.

Collect Information. The alternatives that have been gathered must be systematically evaluated. However, before evaluation can proceed, information must be gathered regarding each of the alternatives and their likely consequences. More specifically, the decision maker must seek to learn as much as possible regarding the likelihood that each alternative will result in the achievement of the goals and objectives being sought. For example, the golf professional who is dissatisfied with his or her current job must gather a great deal of information regarding other jobs that might be available. Information is required on what specific opportunities are available at other clubs, how those clubs treat their employees, what the person's long-term prospects might be at each club, and so on.

Assess the Alternatives. Once all available information has been collected regarding all of the alternatives under consideration, the decision maker must use that information to evaluate the alternatives in a systematic fashion. This requires the decision maker to employ some technique that permits all of the information collected regarding each of the alternatives to be analyzed and compared. The outcome of this evaluation process should then be a rank ordering of the alternatives from best to worst according to their likelihood of leading to the attainment of the goals and objectives of the decision maker. For example, the golf course superintendent dealing with the problem of increased absenteeism and turnover must systematically evaluate all of the consequences anticipated to follow each course of action under consideration. If changes in the pay system were made, what improvements would be expected in absenteeism and turnover at what increased payroll costs? If changes in job design were implemented, how disruptive would they be and how much improvement could be expected?

Select the Best Alternative. This step should be quite straightforward if the evaluation of alternatives has been conducted comprehensively and systematically. The decision maker simply chooses the alternative that the evaluation process has indicated to be most desirable. Problems may arise at this stage, however, if the evaluation process leads to the conclusion that two or more alternatives appear equally likely to be best. For example, a graduating hospitality student may have thought she always wanted to work for Los Angeles Country Club. At the conclusion of the interviewing process she simultaneously receives offers from Los Angeles Country Club and Sawgrass Country Club. No matter how much information she gathers or how much careful evaluation of alternatives she does, it may remain almost impossible to tell which of the two offers would be best for her.

Implement the Decision. Although, strictly speaking, the decision-making process has ended once a decision regarding the best alternative has been reached, it is also true that the decision-making process is no more than a mental exercise if the chosen course of action is not implemented. Further, issues of implementation are frequently important factors in the choice of an alternative in the previous stages. After a great deal of thought and analysis, the golf course superintendent concerned about high absenteeism and turnover may have decided that job redesign was the best solution to the problem. While his decision may be a good one, he still has much work ahead if that decision is to be effectively implemented.

Evaluate Decision Effectiveness. The decision-making cycle should not end until the decision maker judges the extent to which the chosen alternative has succeeded in solving the initial problem and achieving the goals identified at the outset of the process. If such evaluation indicates success, then the decision-making cycle is concluded. However, if the chosen alternative has not solved the problem or achieved stated objectives, then the decision maker must recycle through the decision-making process to generate a new alternative. If, after implementing job enrichment, absenteeism and turnover decline to acceptable levels, the golf course superintendent can feel satisfied that a decision has resulted in the problem being effectively solved. If, however, absenteeism and turnover remain at high levels, the superintendent must go back to the alternative-generating phase and attempt to arrive at a new course of action.

The decision-making process can be divided into three major phases. The first phase includes framing the problem or opportunity, or determining exactly what the decision maker faces and the objectives to be accomplished. The second phase requires the generation of ideas, alternatives, and information. The final phase requires a systematic analysis reduction of the information and alternatives down to a single choice of what will be pursued and implemented.

Classical theory of decision making assumes that decision making follows the above series of steps and makes certain strong assumptions regarding what happens at various stages in the process. We will outline some of the critical assumptions (Higgins, 1991):

1. Goals and objectives are known and agreed upon. Classical theory assumes that the goals to be achieved in any decision situation are either predetermined or else so obvious as to be straightforward. Classical theory does not address itself to situations in which goals are unclear, in which disagreement exists regarding goals, or in which several goals are in conflict with one another.

2. All alternatives are considered. The existence of the problem is recognized, its nature has been identified, and all possible courses of action are considered. According to classical theory, decision makers must generate and evaluate all possible courses of action. Decision making is thus an exhaustive (and probably exhausting) process in which no potential solution to a problem is excluded from consideration.

3. All outcomes are taken into account. The consequences of implementing each alternative are certain, or a probability may be assigned to each. Classical theory assumes that decision makers are aware of and take into account every possible outcome associated with each alternative under consideration.

4. Perfect information is freely available. It is assumed that decision makers either possess or can obtain (at no cost) perfect information regarding (1) the value of every outcome that may be obtained; and (2) the likelihood that each alternative course of action will result in obtaining each of the outcomes.

5. Decision makers are maximizers. Criteria for the best decision are known and agreed upon. Decision makers will seek to maximize their situation by choosing the best alternative.

6. Decision makers are rational. They can assign values, order preferences, and make the decision that will optimize the attainment of the decision maker's objectives. Classical theory views decision makers as totally rational. This total rationality results in the decision maker always choosing the optimal course of action.

Classical theory has enjoyed a good deal of popularity partly because it appears to provide a good description of how people should go about making decisions. In addition, it provides specific guidance to decision makers regarding how to improve the quality of decision making. The Classical theory position that decision making should proceed systematically through the series of steps is sound. Better decisions likely result when decision makers carefully analyze problems, evaluate multiple alternatives, and make systematic choices on the basis of their analyses.

The problem with classical theory lies in the assumptions it makes regarding how decision makers can or should deal with each of the steps in the decision-making process. The assumptions of classical theory are overstated and generally impossible to implement in practice. Arnold (1986) describes many of the shortcomings of classical theory's assumptions:

1. Assumption: Goals are given. In many real decision-making situations goals are not given. Indeed, a central problem in decision-making situations is determining precisely which goal or goals are most important to attempt to attain. For example, does the graduating hospitality student with two job offers in hand choose the job with the highest salary (monetary goal), the best career advancement prospects (development goal), or the most interesting initial work assignments (challenge and interest goal)? Similarly, does a club making decisions regarding changes in its strategy choose one that it hopes will maximize profit, total revenues, market share, long-term growth and stability, or does it choose a strategy that will minimize costs, reduce overhead, and decrease turnover? The decision maker must determine which of a multitude of goals (many of which may be conflicting) is most important to pursue.

2. Assumption: All alternatives are considered. For all but the most trivial decisions it is foolish to suggest that all alternatives can even be identified, much less considered. How realistic is it to suggest that a graduating hospitality student should consider and evaluate all possible potential employers and jobs before choosing to accept an offer? The ambiguity and complexity of organizational decisions make this assumption even more untenable for organizational decisions. The golf course superintendent seeking to reduce absenteeism and turnover has a massive number of potential solutions available to choose from, including any number of changes to the pay system, new approaches to job design, and changes in supervisory styles. Since the number of potential courses of action is so large, adherence to this assumption of classical decision theory would make it almost impossible for such a superintendent to ever to arrive at a decision, since he or she might never finish generating and evaluating all of the alternatives available.

3. Assumption: All outcomes are taken into account. Just as it is likely impossible to generate all possible alternatives, it is impossible to anticipate and predict all possible outcomes of each alternative. The hospitality student choosing between two job offers cannot know for sure exactly what it will be like working for either organization. Will all of the hoped-for opportunities at each club actually materialize? Will the graduating student get along well with his or her new boss? How will his or her co-workers feel about a new person coming into the department? The future is inherently uncertain and unpredictable, and no decision maker can ever be sure that all possible outcomes of a decision have been taken into account.

4. Assumption: Perfect information is freely available. Information is not free, and only rarely is it even feasible to obtain perfect information regarding the ramifications of a course of action. Generating and evaluating alternatives takes time, energy, and resources. Thus, the process of obtaining information for use in decision making frequently has high costs. As a result, almost all decisions are based upon information that is to some extent inadequate and incomplete.

5. Assumption: Decision makers are rational maximizers. The classical model assumes that decision makers have a tremendous mental capacity both for remembering and storing huge quantities of information and for processing that information in order to assess which available alternative is the optimal one. There is an assumption that managers have complete knowledge of the situation. Psychological research indicates that people are incapable of the kinds of mental arithmetic implied by classical theory (MacCrimmon, 1976) and (Simon, 1976). The conclusion is not simply that people do not make decisions in the manner suggested by classical theory; more to the point, they cannot.

Julie Adams is the clubhouse manager at The Barbed Wire Country Club, a large member-owned club located in Texas. Let's look in on an operations meeting she is leading with several department managers.

Julie: "We just received the latest electricity bill for the main clubhouse. While utility rates have not increased, the bill is up over 50 percent compared to the same period last year. We have a real problem that we must remedy. Last January we formulated goals and objectives Æ they were given Æ in order to identify ways in which we could cut utility bills 10 percent. We all agreed that these methods were achievable. Unfortunately, we are woefully off target."

Smitty, the chief engineer spoke up: "I'm not sure that we produced enough ways that we could achieve our goal. For example, we didn't anticipate that the weather would be this warm. While our utility bill was up 50 percent last month, year-to-date figures are about the same since we saved quite a bit on heat during the cold months. What we really need to do is brainstorm some alternative methods for saving on electricity to meet our goal of a 10 percent overall reduction."

Millard, one of the housekeepers, had this to say: "I think we should consider adding by-pass switches to the HVAC system. Engineering had a great idea when we installed the computer system to control the heat and air-conditioning; but when food and beverage has a late event, I have to go into the utility room and manually turn the entire club-wide system back on so the ballroom doesn't get either too hot or too cold. If we had those little egg-timer switches located above the thermostats, we could regulate the temperature in one room without firing-up the whole club."

"Or, we could just stop booking outside functions Æ or make sure events are over by 8:00 PM. Then, we'd save all kinds of money without having to go to the expense of adding timers," quipped Monhegan Lamanthsarrah, banquet supervisor. "Maybe we could just close down altogether Monday through Wednesday; we could let the club be dark."

Everyone enjoys a good chuckle.

"Okay, funny man, we get your point. Remember, what we are trying to do is eliminate waste, not cut down on service. Our original budget charge was to look for ways to trim unnecessary expenses, so we could hold the line on dues increases," stated Julie.

"You're right, I'm sorry."

"No problem. Let's get back to Millard's suggestion. It sounds like a possibility."

"Yes it is. As chief engineer, I can also look into reduced-wattage bulbs, more efficient system filters, re-balance the make-up air in the kitchen, and look into the possibility of tinting certain windows."

"Now we're talking! Let's get it going. Smitty, how much money do you need to get started implementing?"

"Julie, don't you think we should consider our alternatives? We're likely to spend $15,000 on these alternatives. I'm not sure it will give us the payback we are looking for. Don't you want me to run some numbers? Texas Power will give me all the information I need Æ I can get perfect information. We can run a regression model and predict how much money will be saved versus the investment required. You'll be able to maximize results."

"Look, we're being evaluated on our ability to make our goals and objectives. I have decision authority to commit up to $5,000. You can spend the $15,000, but just make sure you fill out three purchase orders (for $5,000 each). Write it up so that it is clear that what you are buying will last for more than one year. Get them to bill you in three $5,000 increments. We can depreciate the $15,000 amount as a capital expense without it going into operations. Just do it. We've got to get back under control."

1. Using the steps described in the classical theory of decision making:

Discern a problem or opportunity.

Formulate goals and objectives.

Produce alternatives.

Collect information.

Assess the alternatives.

Select the best alternative,

Implement the decision.

Evaluate decision effectiveness. What was missing in Julie's meeting and interchange?

2. Discuss any positives you found with Julie's meeting with reference to classical theory.

3. If you were Julie's general manager, what aspects of her plan would you find troublesome?