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The Decision-Making Paradigm of Organizational Design

Author

Listed:
  • George P. Huber

    (College of Business Administration, University of Texas, Austin, Texas 78712)

  • Reuben R. McDaniel

    (College of Business Administration, University of Texas, Austin, Texas 78712)

Abstract

This paper introduces and explicates the decision-making paradigm of organizational design. We argue that the domains of existing design paradigms are declining in scope, and that the nature of current and future organizational environments requires use of a design paradigm that responds to the increasing frequency and criticality of the decision-making process. In particular, we argue that the decision-making paradigm is applicable when the organizational environments are hostile, complex, and turbulent. The focal concept of the decision-making paradigm is that organizations should be designed primarily to facilitate the making of organizational decisions. The paper sets forth the paradigm's six major concepts and discusses the principal domains of its application. The paper also examines the relationships between the decision-making paradigm and the literatures on (1) organizational decision making, (2) the information processing view of organizations, and (3) the need for compatibility between the organization's design and the design of its technologically supported information systems. The paper concludes by identifying ten organizational design guidelines that follow from the decision-making paradigm.

Suggested Citation

  • George P. Huber & Reuben R. McDaniel, 1986. "The Decision-Making Paradigm of Organizational Design," Management Science, INFORMS, vol. 32(5), pages 572-589, May.
    • Handle: RePEc:inm:ormnsc:v:32:y:1986:i:5:p:572-589
    DOI: 10.1287/mnsc.32.5.572
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    Citations

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    Cited by:

    1. Giampio Bracchi & Chiara Francalanci, 1997. "A Model for Information Processing Capacity: Formalizing the Impact of Structural and Information System Choices on Organizational Performance," Computational and Mathematical Organization Theory, Springer, vol. 3(3), pages 173-198, September.
    2. Julie Smith David & Yuhchang Hwang & Buck K. W. Pei & J. Hal Reneau, 2002. "The Performance Effects of Congruence Between Product Competitive Strategies and Purchasing Management Design," Management Science, INFORMS, vol. 48(7), pages 866-885, July.
    3. Kirn, Stefan, 1995. "Organisational intelligence and distributed AI," Arbeitsberichte des Instituts für Wirtschaftsinformatik 40, University of Münster, Department of Information Systems.
    4. Stefan Kirn, 1995. "Cooperative Knowledge Processing: The Key Technology for Future Organizations," Intelligent Systems in Accounting, Finance and Management, John Wiley & Sons, Ltd., vol. 4(4), pages 223-244, December.
    5. Chris P. Long & Sim B. Sitkin & Laura B. Cardinal & Richard M. Burton, 2015. "How controls influence organizational information processing: insights from a computational modeling investigation," Computational and Mathematical Organization Theory, Springer, vol. 21(4), pages 406-436, December.
    6. Zaharias Xanthopulos & Emanuel Melachrinoudis & Marius M. Solomon, 2000. "Interactive Multiobjective Group Decision Making with Interval Parameters," Management Science, INFORMS, vol. 46(12), pages 1585-1601, December.
    7. Kathleen M. Sutcliffe & Gerry McNamara, 2001. "Controlling Decision-Making Practice in Organizations," Organization Science, INFORMS, vol. 12(4), pages 484-501, August.
    8. Haque, Badr & Pawar, Kulwant S. & Barson, Richard J., 2000. "Analysing organisational issues in concurrent new product development," International Journal of Production Economics, Elsevier, vol. 67(2), pages 169-182, September.
    9. John W. Boudreau, 2004. "50th Anniversary Article: Organizational Behavior, Strategy, Performance, and Design in Management Science," Management Science, INFORMS, vol. 50(11), pages 1463-1476, November.
    10. Nilesh Saraf & Christoph Schlueter Langdon & Sanjay Gosain, 2007. "IS Application Capabilities and Relational Value in Interfirm Partnerships," Information Systems Research, INFORMS, vol. 18(3), pages 320-339, September.
    11. Chakraborty, Subhajit & Kaynak, Hale & Pagán, José A., 2021. "Bridging hospital quality leadership to patient care quality," International Journal of Production Economics, Elsevier, vol. 233(C).
    12. Jahangir Karimi & Toni M. Somers & Yash P. Gupta, 2004. "Impact of Environmental Uncertainty and Task Characteristics on User Satisfaction with Data," Information Systems Research, INFORMS, vol. 15(2), pages 175-193, June.
    13. Moser, Roger & Kuklinski, Christian Paul Jian-Wei & Srivastava, Mohit, 2017. "Information processing fit in the context of emerging markets: An analysis of foreign SBUs in China," Journal of Business Research, Elsevier, vol. 70(C), pages 234-247.
    14. Gillenwater, E. L. & Conlon, S. & Hwang, C., 1995. "Distributed manufacturing support systems: the integration of distributed group support systems with manufacturing support systems," Omega, Elsevier, vol. 23(6), pages 653-665, December.
    15. Felipe A. Csaszar & J. P. Eggers, 2013. "Organizational Decision Making: An Information Aggregation View," Management Science, INFORMS, vol. 59(10), pages 2257-2277, October.
    16. Berthon, Pierre R. & Pitt, Leyland F. & Morris, Michael H., 1998. "The Impact of Individual and Organizational Factors on Problem Perception: Theory and Empirical Evidence from the Marketing-Technical Dyad," Journal of Business Research, Elsevier, vol. 42(1), pages 25-38, May.
    17. Spencer, Andrew J. & Buhalis, Dimitrios & Moital, Miguel, 2012. "A hierarchical model of technology adoption for small owner-managed travel firms: An organizational decision-making and leadership perspective," Tourism Management, Elsevier, vol. 33(5), pages 1195-1208.
    18. Kirn, Stefan, 1995. "Cooperative knowledge processing: The key technology for future organizations," Arbeitsberichte des Instituts für Wirtschaftsinformatik 39, University of Münster, Department of Information Systems.
    19. Manuel Mora & Gloria Phillips-Wren & Fen Wang & Ovsei Gelman, 2017. "An Exploratory-Comparative Study of Implementation Success Factors for MSS/DMSS and MIS," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(06), pages 1671-1705, November.

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    Keywords

    organizational design; decision making;

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