Assignment on Problems of Rational Decision making

Submitted to:Prof. Sabu Francis

Submitted by:Hitesh jain Roll no. FM/11/013

What is Rational Decision making? Rational decision making brings a structured or reasonable thought process to the act of deciding. The choice to decide rationally makes it possible to support the decision maker by making the knowledge involved with the choice open and specific. This can be very important when making high value decisions that can benefit from the help of tools, processes, or the knowledge of experts.

Problems and limitations with Rational decision making

1) Limits of human capabilities - The limits on our human ability to gather, process, and understand all the information needed to optimize a decision outcome make it impractical to meet the ideal except in very constrained or simple situations. We have limits in our ability to formulate as well as solve very complex problems. Our desire to optimize is also limited, and we will usually "satisfies", or be content with acceptable solutions when confronted with obstacles.

2) Limits on information and knowledge - The model assumes we should or can gather sufficient information in terms of quantity, quality, accuracy, and integrity. It also assumes that we have access to the required knowledge of the cause and effect relationships that are important to the evaluation of alternative solutions, particularly with respect to projecting future consequences.

3) Limits in time - Search for the optimum solution will generate a delay that could negatively impact the benefits of the chosen alternative. In essence, if the decision alternatives are not properly discounted for changes due to decision timing, the chosen alternative may not be optimum.