• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

The purpose of this assignment is to discuss and analyse the reasons for and the backgroung behind the incresing speed of decision making as organisations find themeselves in an increasingly competitive environment.

Extracts from this document...


'The pace of decision making continues to increase as organisations find themeselves in an increasingly competitive environment.' INTRODUCTION The purpose of this assignment is to discuss and analyse the reasons for and the backgroung behind the icresing speed of decision making as organisations find themeselves in an increasingly competitive environment. In the first half of the essay I wpuld like to discuss the theoretical backgroung, than support them with examples and finally to draw conclusion. DISCUSSION Decision speed has been found to be a vital factor in influencing firm performance in high velocity environments1. This finding -inductively derived in the study by Bourgeois and Eisenhardt- was deductively tested and quantitatively supported by Judge/Miller who argued: "The conclusion that (decision) speed and performance are associated is certainly in keeping with the experiences of a growing number of corporations that are relying on organizational speed to improve their financial performance. For example, Bower and Hout argued that organizations that make fast decisions 'are like World War II fighter pilots- they win by making faster decisions which preempt the opposition's moves." According to Judge/Miller it is due to the increasingly global markets and shortened product life cycles that the attention given to speed of the strategic decisionmaking process is growing. Stalk from the Boston Consulting Group and Thomas state that: "the ways leading companies manage time represent the most powerful new sources of competitive advantage." ...read more.


(2) Timing and number of alternatives: The greater the number of alternatives considered simultaneously, the greater the speed of the strategic decision process. But multiple alternatives are likely to slow the strategic decision process. So 'multiple alternatives' as comprehensiveness, which includes being "exhaustive or inclusive in the generation and evaluation of alternatives." In addition a similar conclusion5 can be reached that multiple alternatives accelerate cognitive processing and hence, decision-making speed. Other justifications for this positive correlation include perceiving multiple alternatives as a form of fallback position. If one alternative fails, executives can quickly shift to a new one Additionally, having simultaneous alternatives reduces the 'escalation of commitment' to any one option6. This implies that decision makers who pursue multiple options have a lower psychological stake in any one alternative and thus, can quickly shift between options if they receive negative information on any alternative. (3) Power and the role of counselors: The greater the use of experienced counselors, the greater the speed of the strategic decision process. The fact that political factors influence the pace of decisions has initially been pointed out that resistance by influential people was a leading cause of delay in making strategic decisions. Alternatively, when few executives are involved, a decision process can be rapid. For example autocratic decision-making in situations in which speed is essential. According to this perspective, centralized power quickens decisionmaking. ...read more.


These people were called counselors by Eisenhardt. Slow teams either had no counselor or had a less experienced executive in the counselor role. Speed, fragments, and decision integration The final critical difference lies in what she calls the web of relationships among the decisions. Fast teams attempted to integrate strategic decisions with one another and with tactical plans. Slower teams did not try to connect or integrate these strategic decisions. Decision integration helps executives to analyze the viability of an alternative more quickly. It helps them cope with the ambiguity of high stakes decision making. The development of concrete ties with other major decisions and decision details may alleviate the anxiety that can plague executives as they face high-stakes decisions. CONCLUSION How does strategic decision speed link to performance? Faster decision making is associated with better performance. Eisenhardt hypothesizes that slow decision makers learn less. Executives learn by making decisions, but if they make few decisions, as slow decision makers do, they learn very little. The teams making fast decisions engage in behaviours to cope with this anxiety & build confidence. One tactic is to rely on the counsel of experienced executives. Another tactic is to tie together strategic decisions and concerete operating plans. Fourth, the findings link fast decision making with effective performance. These findings suggest a configuration of cognitiv e, political, and emotional processes that are associated with rapid closure on major decisions. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our University Degree Management Studies section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related University Degree Management Studies essays

  1. Managing financial resources and decision assignment

    which help small-medium enterprises to use and develop technologically innovative products and processes (BPP, p.21, 2004). The third approach to consider that is Venture Capital. Venture capital is a type of private equity capital typically provided to early-stage, high-potential, and growth companies in the interest of generating a return through

  2. Decision Making: Decision Support Systems. In this paper, we explore the decision-making ...

    combination of raw data, documents, personal knowledge, or business models to identify and solve problems and make decisions." (Turban, Aronson and Liang, 2004) Depending on the nature and uses of a DSS, it can be forward looking, backward looking or be both.

  1. Sustainability Report. Aims: To analyse and study the key strategies towards environment and sustainability ...

    Strategy 4: Environmental Cost Leadership According to Orsato (2008) gaining a price premium for products that are ecologically oriented is a natural solution for many of the firms. If "being green" costs more for the firm, then differentiation strategy is the one of the way out for the firm to pay for ecological investments.

  2. Leadership Theories - this review seeks to determine which theoretical perspectives, theories and schools ...

    some of the issues mentioned above would be to categorize the self and identity constructs found in this analysis. However, this was considered to be outside the scope of this study since it would require investigating how each of the different theoretical perspectives have defined each one of these terms to compile an accurate classification.

  1. Lecture notes - Strategy Making

    within the framework of a traditional strategic planning process, with its implicit assumption that an organization's strategies need to be reviewed only during the annual strategic planning exercise. Serendipity and Strategy Business history is replete with examples of accidental events that help to push companies in new and profitable directions.

  2. Decision Making and Problem Solving, Including the Role of The Manager - Group Decision-Making ...

    congruence with the goals and objectives of the organization, desirable changes in the organizational behavior are likely to follow. (March 1994: Chapter 2) In other words, this reinforcing approach enables the employee to feel more comfortable with his input into the group decision, and to expect appropriate rewards for contributions

  1. Ryanair assignment - analysis and enviromental concerns

    > Switching to another airline is relatively simple. All airlines are online using internet to sell. Ryanair ensures its website/online services is the most user friendliest and sells other products to attract high visit rate to its website. > There is no loyalty among customers.

  2. To complete this assignment on research method process for strategic managers, I will locate ...

    The answer is obviously no. Variety is therefore positive and not negative. If someone goes to a KFC restaurant in Saddar Karachi and finds a âJuada Baltaâ nearby, there will be a day when he will go to that âJuada Baltaâ to explore whatâs being offered.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work