Explanation of the Term Rational - Essay Example

? There is no such thing as a rational decision. Discuss this assertion, and carefully justify the arguments and claims that you make in response to it. Name of the Student University The term rational mean sane, and when it is used to describe people, rational means a person with a clear head who takes decisions thoughtfully, by understanding and assessing what would be good in the long-run. The objective of conducting this study is to identify the implication of certain terms which are regularly used in daily life, but the validity of such concepts is still unknown. People are still in dilemma whether rational decision making exists or not. Some believe in rational decision making, some do not, and many do not even understand what rational decision-making is all about. This study aims at discussing rational decision-making and its existence from the roots. In order to throw light on every dimension of rational decision-making, the discussion would begin from understanding rationality, and will further assist in understanding what does rational decision signify. It will also include what elements assist one in understanding that the particular decision is rational enough. Apart from this, theories in relation to types of rationality would be discussed. The conditions considered for effective decision-making need to be understood in order to conduct a comprehensive analysis for stating whether rational decisions exist or it is just a myth. Rationality is considered to be a normative concept, which signifies any belief, desire or action. It signifies any conviction or concept, which is derived through proper reasoning (Adler, 1991). Rationality can be considered the characteristics of decisions which are supported by motives. Max Weber, a German sociologist proposed a theory of rationality, which explains four types of rationality. The first type of rationality put forward by him is purposive or instrumental rationality. This explains the expectation regarding the behavior of the other objects and the human beings present in the society. The second type of rationality is value or belief oriented. In this case the action is assumed to be essential for the person, such as ethics, religion, motives, etc. The third type of rationality is affectual, which assist in determining the specific affect of emotions or feelings. Weber considered this type of rationality to be meaningfully oriented rationality. The fourth type was habituation, which is traditional. Weber emphasized on these four types of rationality because he considered rationality and rational decision making to be the outcome of one of these types or a combination of these types of rationality stated by him. However, Weber’s point of view for rationality has been criticized by Habermansian, whose proposed theory was devoid of any social power or context, whereas Weber’s theory of rationality was strongly supported by values and power (Berg, & Hoffrage, 2004). A rational decision-maker actually chooses among the different alternatives or courses of action that are based on the ability of the decision-maker. This is because this process includes rational decisions that are not only backed by reasons but are also appropriate enough for achieving goals, and solving problems. While discussing the concept of rational decision-making, elements like rational choice and rational behavior of individuals needs to be also discussed. Rational choices are considered to be economic principles which are assumed to be made by those individuals who make logical and prudent decisions that benefit them and provide them satisfaction. This concept of rational decision-making is based on the rational choice theory. Rational behavior is the decision-making procedure which depends on the choices that would offer optimum level of utility or benefit. According to conventional theories of economics all those individuals who take part in any activity or action are rational. Rational decision does not always assist in generating profit because it is considered that sometimes rational behavior or decisions provides satisfaction too (Berg, 2003). It is being said that stress on the concept of verifiability is due to the recent fashion of increasing focus towards rational decisions. The foundation of rational decisions is based on measurable facts that are usually ordered in a systematic manner. This process has been denoted by various names right from problem solving, corporate planning, operations, research or management by objectives. The rational based decision-making process includes a series of steps, which involves confrontation of problems, identification of objectives, determining the criteria, and making appropriate choices. This is because rational decision-making involves exhaustive scanning of various choices and their consequences. Now this is a debatable issue that whether decisions are taken in such formal way or not. As said this depends on the beliefs of the decision-maker, so various perspectives would be put forward in relation to this question. However, the study would be narrowed down to support any particular decision (Bigand, McAdams, & Foret, 2000). A rational decision for one person might not be rational for the other. However, this does not mean that the other person believes that his/ her decision is not rational. A particular decision taken or made by an individual is supported by some reasons, so rationality does not have a universal standard that can be used for measurement, but it is perspective and belief oriented. It is objective oriented, and it changes from one individual to another. Decision-making rationality signifies logic and reasons. However, there are various decisions that are taken as a part of reflexive action that is without much logic or thinking. These are habitual decisions that are made because it is always done (Brake, Walker, & Walker, 1995). However, the above stated view needs to be supported by theories, which can strengthen the perspective of rationality. This can be initiated with a discussion on the approaches of rationality, such as comprehensive rational approach. This is also known as logical positivism, which signifies that that there is no tolerance for anything else other than mechanical or logical ways of decision-making. Comprehensive rationality has philosophical roots which were an issue of debate between the rationalists, who considered everything to be external and can be only experienced through senses. Natural law puts forward that everything that exists arises from certain belief and facts that has been proven to be true. Hume however, attacks this concept by considering it to be obstinate medieval philosophy. Hume considers that in 21st century logical positivism distinguishes between ethical and factual decisions or statement. The factual statements are those which can be tested, and reveals a logical outcome (Champoux, 2001). In this context another significant aspect need to be evaluated, namely value and fact and its importance in decision-making. Rationality contains both value and fact but for different believers the quantity of fact and value differ. There is confusion over the role of value and fact in decision-making. This distinction forms the basis for rational approach. Traditionally it was considered that decision-making had two components, ethical and factual. The factual decision cannot be identified from the ethical decisions with the help of logical reasoning. Similarly the ethical statements cannot be proved through facts because ethics goes beyond facts (Conlisk, 1996). Any rational decision-making model has certain basic components that are an understanding of identity and an understanding of world. Every human being has a natural rational model integrated with their minds which compel them to think. Even an infant has a rational model working for him/ her to think and understand according to the limits of his/ her intelligence. In general terms, the ability, or capability of thinking and judging options before decision making is considered rational. Rational model is also called the process of realizing problem, and evaluating it by establishing planning criteria, through implementation of alternatives. However, the rational model is based on lots of assumptions, and without the support of these assumptions the decisions cannot be taken. This model compels to assume that the information that has been acquired has to be accurate in terms of quality, quantity, and accuracy. However, this assumption is impractical in real-life situation. It further assumes that substantial knowledge regarding the cause and effect relationship has to be there and evaluation of alternative has to be appropriate. Thorough knowledge on alternatives should be there and consequences of choosing such alternatives have to be decided. All these assumptions seem to be hypothetical in nature because they are too perfect for any human being to achieve for rational decision-making. Rational decision making concept involves non-pragmatic causes, of which the individuals are either totally or partly unaware. According to the Bayesian theory, decisions have to be always rational. This doctrine has also entailed that many analysts have considered this conception to be wrong which stated that scientific induction cannot be judged on the rational grounds. This proposition has been also supported by other philosophers, who considered that Bayesian inference is the only rational form of inference. This orthodoxy has been also been promoted by those philosophers, but on the other hand authors have also discovered irrationality to answer the followers of Bayesian theory (Connors, 2001). However, the modern rational decision-making model suggests that choices made to maximize cost and benefits are rational decisions. This representation does not include any intrinsic cost, benefits, or ethical concerns. It is assumed that individuals have perfect information regarding the results because the choices are made by them. They also have the cognitive ability and tenure to assess and measure very possibility against every choice. In this context a rational decision model can be also suggested (Connors, 2001). The process would begin with the development of a framework of goals and their outcomes. The next step comprises of gathering data, brainstorming and assessing alternatives, developing lists of pros and cons to make the decision. Then the plan is implemented and the reflection of the decisions can be seen through the outcome. The critical elements in this rational decision-making model are assessment of the different alternative against the other, leading to achieving of goals and objectives. Generation of alternatives is important as well as challenging because this might easily lead to disappointment. A decision-maker can also face challenges while choosing the best possible alternative. In case of rational thinking and decision making, a common problem occurs this is also known as ‘analysis paralysis’. In such case most of the time is spent in gathering data and assessing them, but no decision is actually made. Analysts are prone to plunge into such trap, so a time comes when these decision-makers derive a good-enough decision, which can be also called bounded rationality, as would be discussed later in this study. This depicts that there are rare cases when purely rational decisions are taken. The question with which the study was initiated becomes evident in this case again; are there any decisions, which can are purely based on rational decision-making process (Crozier, & Skliopidou, 2002). The rational model for decision-making is based on the assumption that the participants in this case have already agreed that they are making the decision in the right way, and rules that have been followed for decision making are known by all. The decision-making model based on rational thinking generally aims at making best possible choice on the basis of cautious assessment of the alternative paths of action. However, this process is depended on quantitative and computational techniques, and complexity of the issue. The rational model claims to be the foundation for decision-making in commercial as well as private life and is considered to be quite effective in the assumed conditions. In this model the process of decision-making is viewed as a sequential procedure of various activities that leads from initial identification of the problem and recognition of alternative track of action (Dishon-Berkovits, & Algom, 2000). If the decision process is considered for two products that would be newly launched in the market, then the rationalist would be interest if the launch seem profitable to him/ her. The straightforward method that he/ she would be considering is projecting the expenditure and incomes that is associated with the launch and sales of those two projects. In this case it can be said rational thinking becomes mainly a subject of technical expertise. It can be also derived that where there are agreed goals, adequate information and clear choices, rational decisions work well. However, all the situations are not so straightforward and clear. One of the foremost hypotheses is that rational decision-making approach does provide one of the best ways to arrive at a solution, but the believer of rational decision-making pays less importance to decision-making in organizational context (Dow, 1991). As it has been suggested by Hickson, in case of organizational decision-making problems are identified, data are gathered, and criteria are considered for decision-making. Only usage of quantitative techniques and logical reasoning does not make the decisions rational. These are the inputs that are essential for a whole process which are influenced by interest and preferences of the participants in the organization. For example, in case of launching two new products, as considered previously, the logical reasons and quantitative tools would assist in knowing what situation or strategy led to such a launch or decision for new products. It would also assist in identification of logic behind not selecting the other options, and the alternative profit-making ways. This proves rationality is just a supportive tool in decision-making (Doyle, & Thomason, 1999). Rational decision making model is influenced by economic theory and classical management theory. This has been considered especially in context of the population of individuals who seek to have the best reward rationally. They wish to maximize profit and gain utility through optimization of choice. However, practically such cost and time is generally ruled out in the search for optimum solution, and profit maximization cannot be considered the only rational outcome that any individual can desire for. According to the classical theory of decision-making rationality in decision-making is and a unitary outline of suggestions and an expected or stable environment, though there is rarely any agreement in the organization regarding the goals or means to attain them (Geva, & Mintz, 1997). These environments are generally characterized by doubt. In contrast to the rational decision-making model, another decision-making model has been developed on the basis of actual behavior of the decision-makers. This approach is also known as administrative model. Simon suggested that human beings have limited capacity of processing information, so there are also limits of metal ability and human rationality. These limitations or constraints play significant role in decision-making process (Godijn, & Theeuwes, 2002). By now it is clear that there is actually no such thing called perfect rational decision-making. Rationality is an aspect that is available in limited quantity in decisions, based on the type of decision. It has been seen that the relation between rational and non-rational aspect is similar to that of economic and Freudian theory. It is the premise of the decision-maker on which the decision is based upon and not solely on rationality. In case of economic model, decision-maker should have a framework of the entire factual premise, or a complete array of alternatives, and also the value premise means the preference ordering or utility functions, which are applicable to the issue. These premises are not given, so the decision-maker has to identify them. In this process, the decision-maker has to face various limitations, which diminish the quantity and quality of the mentioned premise on the basis of which decision would be taken. The habits, reflexes and the skills are more or less taken unconsciously and automatically determine the performance of the individual (Godijn, & Theeuwes, 2002). This limitation is evident at the operational level in the organization. The different techniques of traditional scientific management is considered to be an effort for increasing the productivity through widening boundaries of rational decision-making at the workshop level. The second level of constraint associated with rationality is values, and motivation of individuals. In the context of organizations, individuals identify themselves through values and behavior that is followed in various groups, which might even limit the rational behavior of an individual. Rationality cannot be judged in this case by comparing them with organizational goals and standards (Hastie, & Dawes, 2000). Lastly, rational decision-making is restricted to basic information and knowledge that are available. This limitation is mostly neglected in the organization theory. All the above limitation, one thing has been tried to explain, the areas to which rationality is confined. These areas explain the fact that rationality can be exercised in certain restricted areas, and this is the realistic scenario. Rationality cannot be used for every decision-making, but this does not mean that rational-decisions do not exist. They do exist but every choice cannot be supported with reasons and logic (Hutchison, 2002). If the concept of rationality would be present everywhere, then words like sudden and accidents would not have existed. Rational decisions-making is based on certain assumptions. Under the process of rational decision, the problem is considered to be unambiguous. There has to be a single goal for achievement, and the consequences for every alternative would be known. The preferences should be clear, stable and constant. On the other hand the intuitive process of decision making depend on the feelings, values, and instincts. It does not rely on rational and linear processes. Intuitive decisions are taken on the basis of experiences, connections, and relationships (Mullainathan, 2002). If a comparison is drawn between the two, it can be seen that rational decisions are based on the logic of situations, organizational principles, and only truth. Irrational or intuition driven decisions are led by human values, emotions, values, and feelings. In case of rational decision-making, the past, present as well as the future is analyzed, while in the other case, only past is considered. Rational decisions have strong support of logic. It is firm and meant for tough-minded and logical decision-makers. Intuitive decision-makers are sympathetic, emotional, loyal, and take interest in people and their problems (Neuman, 2002). As far as the weaknesses, are concerned, rational decisions are excessively analytical in nature, rigid, serious, unemotional, and have a tendency to impose ideas, while irrational decisions are backed by sentiments. However, just because a decision is not rational, it cannot be considered irrational. Such decisions can be counted under the category of creativity, intuitive decisions, and bounded rationality. In case of creativity the solution are not apparent for the problem. For the problem new solutions has to be generated for which the decision-maker gets ample time to identify new ways of achieving the objectives (Schein, 1992). In case of intuitive decision-making, the goals are not clear, there is time constraint, but the positive thing is that the decision-maker is experienced in handling such situation. In case of bounded rationality the basic criteria are apparent, but the decision-maker is not so eager to invest time for making decision, and maximize the outcome. This discussion proves that fact again that rational decisions does exist, but decision-making process of other form also subsist outside the domain of rationality (Tecker, Bower, & Frankel, 1999). There are various possibilities which can be considered in this case. Whether rational decisions exist or not cannot be exactly stated because there are various propositions and contradictory statements available and put forward by eminent authors, philosophers and analyst. Each of their theories for rational decisions and other forms of decision-making outside the domain of rational decisions are true. It rationality in decision-making signifies the characteristics of sense and logic, then a human being who is insane can only take irrational decisions. However, for an insane human being decision taken by him/ her is true to their logic, which proves that it is rational for them. If rationality is logic and reasons in decisions, then also creative decisions, intuitive decisions cannot be called illogical. For example, if an injured person is found on road, then intuitive decision would be to take the person to the hospital out of humanity, rational decision would also be to take the person to the hospital, because logic says that the person would die if not provided medication. In such cases it can be seen that different forms of decision-making diverge (Trompenaars, 1994). However the existence of rationality cannot be questioned because like intuition, creativity and logic exists, rationality forms an integral part of decision-making. There are certain limitations of rational decision-making, probably because of which people fail to take purely rational decisions. Most of these limitations are based on rational choices that fall short of the actual ideal. The first limitation is constraints in human capabilities that check the ability of the human to assemble the process, and understand the information that is required to optimize the decisions or outcome. Human beings also have limits to which they can solve a complex problem. The second limitation is the extent of knowledge and information. According to the rational decision-making model, gathering sufficient information is necessary for having ample amount of alternatives. Knowing a cause and effect relationship is also necessary. However, the limit to which information is required is not known. Thirdly, there are time limitations, which is important for identification of optimum solution. However, rational choices have certain benefits too. It assist in offering a stepwise procedure in breaking down difficult problems, ensures that goals are decided before moving on towards solution, provides a structured, measured and logical framework to take decision, and includes the feature of analyzing every alternative with cause and effect perspective (Muzeles, 1967). There has been a comprehensive discussion on various facets of rational decision-making in order to identify whether rational decision-making actually exists or not. In the process of identify the existence of rational decision-making, this study has also assisted in identifying various other decision-making models which do not consider rationality, but they cannot be called irrational because decision which is not rational cannot be called irrational. Now the focus would be towards assessment of the information that has been stated and discussed in this study above. Various concepts of rationality, rational decision-making, bounded rational decision-making, creative decision, etc have been evaluated in order to understand whether rationality exists in decision making. Decision-making is considered to be one of the most significant characteristics of human being’s mental ability. It is a complex phenomenon, which is usually broken down into simpler processes through various decision-making models (Trompenaars, 1994). Rational decisions do exist and it is true that in organizations and business environment rational decision making process is preferred because it is a general notion that profit making organization are concerned about goal achievement and logically earning profit. There is little or no room for any emotional decisions, intuition, or feelings. In such can it can be said that rational decisions strongly exist. However, organizations are incomplete without human resource and humans cannot be devoid of values, feelings or emotions. Though business environment is depended on decisions taken through logics and reasons but values, humanity, brings sustainability to the organization (Neuman, 2002). Decision-making models assist in solving various ethical dilemmas. This cannot be done without considering the essential morals, values or ethics. In such a case logic is not always the level of measurement. It cannot be denied that rationality does not exist because rational processes of making decisions are the most useful way to break-down and solve complex problem areas. It assists in solving those issues where humans face the dilemma of choice between two or more options. However, purely rational decision-making does not exist, because human being have to face certain natural constraints that they cannot overcome, such as limitation of time, intelligence, knowledge, and information. Moreover, it is very difficult for them to keep away their intuitions and values and focuses totally on logic. 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