IDEAS home Printed from https://ideas.repec.org/a/url/upravl/v12y2021i1p2-17.html
   My bibliography  Save this article

Functional approach in decision-making: Dysfunction and efficiency of rules and systems

Author

Listed:
  • Oleg S. Sukharev

    (Institute of Economics of the Russian Academy of Sciences, Moscow, Russia)

Abstract

The theoretical study aims at developing the functional approach to the choice of economic decisions by revising rationalistic criteria with respect to the relationship between efficiency and dysfunction as a parameter characterizing the disorder (failure to perform) the functions of the controlled system. From this perspective, there was no solution to this scientific problem. The paper focuses on the analysis of criteria for making economic choice from the available alternatives using the case of investment and technological choice, i.e. the distribution of resources among areas of use, as well as technological substitution and supplement. Decision theory applied to the problem of choosing from economic alternatives constitutes the methodological basis of the study. The research methods are structural and mathematical functional analysis. We introduce an additional decisionmaking criterion reduced to an assessment of the controlled system’s dysfunction while establishing its possible relationship with the efficient functioning. This allows one to prove that the difference in the laws of change in the number of functions performed and their total number in an economic system of any level of complexity, as well as the law of behaviour of costs incurred in the implementation of the functions, determines the relationship between dysfunction and the efficiency of functioning. The results show that the use of rationalistic criteria, such as the greatest manufacturability and the lowest costs, does not take into account the “structural effect” of distribution and functional use of the resource received by the object. Thus, the obtained ratios of dysfunction and efficiency are an additional useful criterion when weighing alternatives.

Suggested Citation

  • Oleg S. Sukharev, 2021. "Functional approach in decision-making: Dysfunction and efficiency of rules and systems," Upravlenets, Ural State University of Economics, vol. 12(1), pages 2-17, March.
    • Handle: RePEc:url:upravl:v:12:y:2021:i:1:p:2-17
    DOI: 10.29141/2218-5003-2021-12-1-1
    as

    Download full text from publisher

    File URL: http://upravlenets.usue.ru/images/89/1.pdf
    Download Restriction: no
    File URL: http://upravlenets.usue.ru/ru/-2021/738
    Download Restriction: no
    File URL: https://libkey.io/10.29141/2218-5003-2021-12-1-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Yang, Hyeonchae & Jung, Woo-Sung, 2016. "Structural efficiency to manipulate public research institution networks," Technological Forecasting and Social Change, Elsevier, vol. 110(C), pages 21-32.
    2. Meidell, Anita & Kaarbøe, Katarina, 2017. "How the enterprise risk management function influences decision-making in the organization – A field study of a large, global oil and gas company," The British Accounting Review, Elsevier, vol. 49(1), pages 39-55.
    3. Elango, B. & Dhandapani, Karthik, 2020. "Does institutional industry context matter to performance? An extension of the institution-based view," Journal of Business Research, Elsevier, vol. 115(C), pages 139-148.
    4. Khalil, Elias L., 2013. "Lock-in institutions and efficiency," Journal of Economic Behavior & Organization, Elsevier, vol. 88(C), pages 27-36.
    5. Ya. P. Silin & E. G. Animitsa & N. V. Novikova, 2019. "Theories of economic growth and economic cycles in the research of regional processes of new industrialisation," Journal of New Economy, Ural State University of Economics, vol. 20(2), pages 5-29, May.
    6. Davanzati, Guglielmo Forges, 2018. "Structural change driven by institutions: Thorstein veblen revised," Structural Change and Economic Dynamics, Elsevier, vol. 45(C), pages 105-110.
    7. Beugelsdijk, Sjoerd & Jindra, Björn, 2018. "Product innovation and decision-making autonomy in subsidiaries of multinational companies," Journal of World Business, Elsevier, vol. 53(4), pages 529-539.
    8. Korhonen, Kirsi & Pirttila, Timo, 2003. "Cross-functional decision-making in improving inventory management decision procedures," International Journal of Production Economics, Elsevier, vol. 81(1), pages 195-203, January.
    9. Söderholm, Patrik & Hellsmark, Hans & Frishammar, Johan & Hansson, Julia & Mossberg, Johanna & Sandström, Annica, 2019. "Technological development for sustainability: The role of network management in the innovation policy mix," Technological Forecasting and Social Change, Elsevier, vol. 138(C), pages 309-323.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Oleg S. Sukharev, 2022. "Institutional adjustments in management: A theoretical-methodological approach," Upravlenets, Ural State University of Economics, vol. 13(1), pages 37-48, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Oleg S. Sukharev, 2022. "Institutional adjustments in management: A theoretical-methodological approach," Upravlenets, Ural State University of Economics, vol. 13(1), pages 37-48, March.
    2. José Ruiz-Canela López, 2021. "How Can Enterprise Risk Management Help in Evaluating the Operational Risks for a Telecommunications Company?," JRFM, MDPI, vol. 14(3), pages 1-26, March.
    3. Klaus E. Meyer & Chengguang Li & Andreas P. J. Schotter, 0. "Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 0, pages 1-39.
    4. Ugonna, Dr Charity Udodirim & Ochieng, Prof Edward G. & Zuofa, Dr Tarila, 2021. "Augmenting the delivery of public research and development projects in developing countries," Technological Forecasting and Social Change, Elsevier, vol. 169(C).
    5. Lee, Hyoungjin & Chung, Chris Changwha & Beamish, Paul W., 2019. "Configurational characteristics of mandate portfolios and their impact on foreign subsidiary survival," Journal of World Business, Elsevier, vol. 54(5), pages 1-1.
    6. Tina C Ambos & Sebastian H Fuchs & Alexander Zimmermann, 2020. "Managing interrelated tensions in headquarters–subsidiary relationships: The case of a multinational hybrid organization," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(6), pages 906-932, August.
    7. Stefanidis, Abraham & Banai, Moshe & Newburry, William & Fainshmidt, Stav & Richter, Ulf Henning & Schinzel, Ursula & Kong, Yin & Erkus, Ahmet & Shakirova, Svetlana & Ozbek, Mehmet Ferhat & Goelzner, , 2023. "Managers’ dispositions toward formal contracts: A cross-country examination," Journal of Business Research, Elsevier, vol. 168(C).
    8. Joel Bigley, 2018. "Assembling Frameworks for Strategic Innovation Enactment: Enhancing Transformational Agility through Situational Scanning," Administrative Sciences, MDPI, vol. 8(3), pages 1-20, July.
    9. Pedro Makhoul & Aldo Musacchio & Sergio Lazzarini, 2020. "Going the Distance: The Foreign Investment Strategies of Sovereign Wealth Funds," Strategy Science, INFORMS, vol. 5(1), pages 39-54, March.
    10. Landoni, Matteo & ogilvie, dt, 2019. "Convergence of innovation policies in the European aerospace industry (1960–2000)," Technological Forecasting and Social Change, Elsevier, vol. 147(C), pages 174-184.
    11. Sun, Yutao & Jiang, Lin & Cao, Cong & Tseng, Fang-Mei, 2024. "From contributors to boundary spanners: Evolving roles of government agencies in China’s innovation policy network (1980–2019)," Technovation, Elsevier, vol. 132(C).
    12. Patricia Laurens & Pierluigi Toma & Antoine Schoen & Cinzia Daraio & Philippe Larédo, 2023. "How does Internationalisation affect the productivity of R&D activities in large innovative firms? A conditional nonparametric investigation," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(2), pages 1079-1100, April.
    13. Asef Karimi & Haniye Rezaei & Morteza Akbari & Pantea Foroudi, 2021. "The concept of innovation network: an application of the meta-synthesis approach," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 11(1), pages 399-419, December.
    14. Ortiz, Norma & Jaramillo Zambrano, Carlos & Garay, Urbi & Tellez-Falla, Diego F., 2024. "A new side of deglobalization: Why did US multinational corporations deconsolidate their subsidiaries from Venezuela?," Journal of Business Research, Elsevier, vol. 182(C).
    15. Rohe, Sebastian & Chlebna, Camilla, 2022. "The evolving role of networking organizations in advanced sustainability transitions," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    16. Liu, Ting & Li, Xizhuo, 2022. "How Do MNCs Conduct Local Technological Innovation in a Host Country? An Examination From Subsidiaries' Perspective," Journal of International Management, Elsevier, vol. 28(3).
    17. Farrukh, Clare & Holgado, Maria, 2020. "Integrating sustainable value thinking into technology forecasting: A configurable toolset for early stage technology assessment," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    18. Falcone, Pasquale Marcello & Lopolito, Antonio & Sica, Edgardo, 2019. "Instrument mix for energy transition: A method for policy formulation," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    19. Patricia Laurens & Pierluigi Toma & Antoine Schoen & Cinzia Daraio & Philippe Larédo, 2022. "How does Internationalisation affect the productivity of R&D activities in large innovative firms? A conditional nonparametric investigation," Post-Print hal-03840316, HAL.
    20. Trey Malone & Kevin Gomez, 2019. "Hemp in the United States: A Case Study of Regulatory Path Dependence," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(2), pages 199-214, June.

    More about this item

    Keywords

    management; investment decision; change in the number of functions; decision-making criterion; dysfunction; efficiency; choice of technological alternative;
    All these keywords.

    JEL classification:

    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • P11 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Planning, Coordination, and Reform

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:url:upravl:v:12:y:2021:i:1:p:2-17. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Victor Blaginin (email available below). General contact details of provider: https://edirc.repec.org/data/usueeru.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.