TASK: RATIONAL DECISION-MAKING AND CRITICAL THINKING
Rational decision-making technique requires managers to make consistent, value- maximizing choices, within specified constraints (Robbins, 2005). This technique may be applied under the following assumptions:
1. The problem is clear and unambiguous.
2. A single well-defined goal is to be achieved.
3. All alternatives and consequences are known.
4. Preferences are clear.
5. Preferences are constant and stable.
6. No time and cost constraints exist.
7. Final choice will maximize pay-off.
In the analysis provided on Genco’s plan for expansion in Kava, almost all the assumptions for a rational decision-making technique were met as manifested by the following:
1. The problem is clear that strategies must be designed in order to provide a guide for Genco in its plan for global expansion.
2. All the alternatives are known and some highlights of the possible consequences were provided. These alternatives include: exporting, licensing, franchising, and direct investment. Justification and possible consequences for each alternative were also provided.