Journal of Business Ethics

, Volume 105, Issue 3, pp 289–306 | Cite as

Assumptions in Decision Making Scholarship: Implications for Business Ethics Research

Article

Abstract

While decision making scholarship in management has specifically addressed the objectivist assumptions within the rational choice model, a similar move within business ethics has only begun to occur. Business ethics scholarship remains primarily based on rational choice assumptions. In this article, we examine the managerial decision making literature in order to illustrate equivocality within the rational choice model. We identify four key assumptions in the decision making literature and illustrate how these assumptions affect decision making theory, research, and practice within the purview of business ethics. Given the breadth of disciplines and approaches within management decision making scholarship, a content analysis of management decision making scholarship produces a greater range of assumptions with finer granularity than similar scholarship within business ethics. By identifying the core assumptions within decision making scholarship, we start a conversation about why, how, and to what effect we make assumptions about decision making in business ethics theory, research, and practice. Examining the range of possible assumptions underlying current scholarship will hopefully clarify the conversation and provide a platform for future business ethics research.

Keywords

Decision making Objectivism Constructionism Sensemaking Dual-processing Intuitions Teaching business ethics 

References

  1. Atuahene-Gima, K., & Haiyang, L. (2004). Strategic decision comprehensiveness and new product development outcomes in new technology ventures. Academy of Management Journal, 47, 583–597.Google Scholar
  2. Axelrod, R. (1997). Advancing the art of simulation in the social sciences. In R. Conte, R. Hegselmann, & P. Terna (Eds.), Simulating social phenomena (pp. 21–40). Berlin: Springer.Google Scholar
  3. Bartlett, D. (2003). Management and business ethics: A critique and integration of ethical decision-making models. British Journal of Management, 14(3), 223–235.Google Scholar
  4. Batjargal, B., & Liu, M. (2004). Entrepreneur’s access to private equity in China: The role of social capital. Organization Science Special Issue on China, 15(2), 159–172.Google Scholar
  5. Berger, P., & Luckmann, T. (1967). The social construction of reality: A treatise in the sociology of knowledge. New York: Free Press.Google Scholar
  6. Boland, R. J., Jr., Singh, J., Salipante, P., Aram, J. D., Fay, S. Y., & Kanawattanachai, P. (2001). Knowledge representations and knowledge transfer. Academy of Management Journal, 44, 393–417.Google Scholar
  7. Bottom, W. P., Holloway, J., Miller, G. J., Mislin, A., & Whitford, A. (2006). Building a pathway to cooperation: Negotiation and social exchange between principal and agent. Administrative Science Quarterly, 51, 29–58.Google Scholar
  8. Brockner, J. (2002). Making sense of procedural fairness: How high procedural fairness can reduce or heighten the influence of outcome favorability. Academy of Management Review, 27, 58–76.Google Scholar
  9. Brockner, J., Tyler, T. R., & Cooper-Schneider, R. (1992). The influence of prior commitment to an institution on reactions to perceived unfairness: The higher they are, the harder they fall. Administrative Science Quarterly, 37, 241–261.Google Scholar
  10. Busenitz, L. W., & Barney, J. B. (1997). Differences between entrepreneurs and managers in large organizations: Biases and heuristics in strategic decision-making. Journal of Business Venturing, 12(1), 9–30.Google Scholar
  11. Ching, C., Holsapple, C. W., & Whinston, A. B. (1992). Reputation, learning and coordination in distributed decision-making contexts. Organization Science, 3, 275–297.Google Scholar
  12. Cushman, F. J., Young, L., & Hauser, M. (2006). The role of conscious reasoning and intuition in moral judgment: Testing three principles of harm. Psychological Science, 17(12), 1082–1089.Google Scholar
  13. Dane, E., & Pratt, M. G. (2007). Exploring intuition and its role in managerial decision making. Academy of Management Review, 32, 33–54.Google Scholar
  14. Dean, J. W., & Sharfman, M. P. (1996). Does decision process matter? A study of strategic decision-making effectiveness. Academy of Management Journal, 39, 368–396.Google Scholar
  15. DeVoe, S. E., & Pfeffer, J. (2007). Hourly payment and volunteering: The effect of organizational practices on decisions about time use. Academy of Management Journal, 50, 783–798.Google Scholar
  16. Dewey, J. (1938/1998). The pattern of inquiry. In L. Hickman & T. M. Alexander (Eds.), The essential Dewey (pp. 169–179). Bloomington, IN: Indiana University Press.Google Scholar
  17. Dulebohn, J. H., & Ferris, G. R. (1999). The role of influence tactics in perceptions of performance evaluations’ fairness. Academy of Management Journal, 42, 288–303.Google Scholar
  18. Dutton, J. E., & Ashford, S. J. (1993). Selling issues to top management. Academy of Management Review, 18, 397–428.Google Scholar
  19. Elangovan, A. R. (1995). Managerial third-party dispute intervention: A prescriptive model of strategy selection. Academy of Management Review, 20, 800–830.Google Scholar
  20. Elsbach, K. D., & Barr, P. S. (1999). The effects of mood on individuals’ use of structured decision protocols. Organization Science, 10, 181–198.Google Scholar
  21. Elsbach, K. D., & Elofson, G. (2000). How the packaging of decision explanations affects perceptions of trustworthiness. Academy of Management Journal, 43, 80–89.Google Scholar
  22. Feldman, D. C. (1994). The decision to retire early: A review and conceptualization. Academy of Management Review, 19, 285–311.Google Scholar
  23. Flannery, B. L., & May, D. R. (2000). Environmental ethical decision making in the U.S. metal-finishing industry. Academy of Management Journal, 43, 642–662.Google Scholar
  24. Forbes, D. P. (2007). Reconsidering the strategic implications of decision comprehensiveness. Academy of Management Review, 32, 361–376.Google Scholar
  25. Freeman, R. E. (1994). The politics of stakeholder theory: Some future directions. Business Ethics Quarterly, 4(4), 409–421.Google Scholar
  26. Freeman, R. E., Martin, K., & Parmar, B. (2007). Stakeholder capitalism. Journal of Business Ethics, 74(4), 303–314.Google Scholar
  27. Frooman, J. (1999). Stakeholder influence strategies. Academy of Management Review, 24, 191–205.Google Scholar
  28. Ganster, D. C. (2005). Executive job demands: Suggestions from a stress and decision-making perspective. Academy of Management Review, 30, 492–502.Google Scholar
  29. Gladwell, M. (2005). Blink: The power of thinking without thinking. New York: Little Brown and Company.Google Scholar
  30. Graebner, M. E., & Eisenhardt, K. M. (2004). The seller’s side of the story: Acquisition as courtship and governance as syndicate in entrepreneurial firms. Administrative Science Quarterly, 49, 366–403.Google Scholar
  31. Greve, H. R. (1998). Performance, aspirations, and risky organizational change. Administrative Science Quarterly, 43, 58–86.Google Scholar
  32. Gundlach, M. I., Douglas, S. C., & Martinko, M. J. (2003). The decision to blow the whistle: A social information processing framework. Academy of Management Review, 28, 107–123.Google Scholar
  33. Haidt, J. (2001). The emotional dog and its rational tail: A social intuitionist approach to moral judgment. Psychological Review, 108(4), 814–834.Google Scholar
  34. Haidt, J., Bjorklund F., & Murphy, S. (2004). Moral dumbfounding: When intuition finds no reason. Unpublished Manuscript, University of Virginia.Google Scholar
  35. Hambrick, D. C. (2007). The field of management’s devotion to theory: Too much of a good thing? Academy of Management Journal, 50, 1346–1352.Google Scholar
  36. Hambrick, D. C., Finkelstein, S., & Mooney, A. C. (2005). Executive job demands: new insights for explaining strategic decisions and leader behaviors. Academy of Management Review, 30, 472–491.Google Scholar
  37. Harrison, P. D., & Harrell, A. (1993). Impact of “adverse selection” on managers’ project evaluation decisions. Academy of Management Journal, 36, 635–643.Google Scholar
  38. Hastie, R. (2001). Problems for judgment and decision making. Annual Reviews in Psychology, 52, 653–683.Google Scholar
  39. Henderson, A. D., & Fredrickson, J. W. (2001). Top management team coordination needs and the CEO pay gap: A competitive test of economic and behavioral views. Academy of Management Journal, 44, 96–117.Google Scholar
  40. Huber, G. P. (1990). A theory of the effects of advanced information technologies on organizational design, intelligence, and decision making. Academy of Management Review, 15, 47–71.Google Scholar
  41. James, W. (1890). Principles of psychology. Chicago, IL: University of Chicago Press.Google Scholar
  42. Jeppesen, L. B., & Frederiksen, L. (2006). Why do users contribute to firm-hosted user communities? Organization Science, 17, 45–63.Google Scholar
  43. Jones, T. M. (1991). Ethical decision making by individuals in organizations: An issue-contingent model. Academy of Management Review, 16, 366–395.Google Scholar
  44. Jones, T. M., & Ryan, L. V. (1997). The link between ethical judgment and action in organizations: A moral approbation approach. Organization Science, 8, 663–680.Google Scholar
  45. Judge, W. Q., & Miller, A. (1991). Antecedents and outcomes of decision speed in different environmental contexts. Academy of Management Journal, 34, 449–463.Google Scholar
  46. Kern, M. C., & Chugh, D. (2009). Bounded ethicality: The perils of loss framing. Psychological Science, 20(3), 378–384.Google Scholar
  47. Kohlberg, L. (1984). The psychology of moral development. San Francisco, CA: Harper & Row.Google Scholar
  48. Konovsky, M. A., & Pugh, S. D. (1994). Citizenship behavior and social exchange. Academy of Management Journal, 37, 656–669.Google Scholar
  49. Kulik, C. T., Roberson, L., & Perry, E. L. (2007). The multiple-category problem: Category activation and inhibition in the hiring process. Academy of Management Review, 32, 529–548.Google Scholar
  50. Labianca, G., Gray, B., & Brass, D. J. (2000). A grounded model of organizational schema change during empowerment. Organization Science, 11, 235–257.Google Scholar
  51. Langley, A., Mintzberg, H., Pitcher, P., Posada, E., & Saint-Macary, J. (1995). Opening up decision making: The view from the black stool. Organization Science, 6, 260–279.Google Scholar
  52. Laroche, H. (1995). From decision to action in organizations: Decision-making as a social representation. Organization Science, 6, 62–75.Google Scholar
  53. Lee, T. W., & Mitchell, T. R. (1994). An alternative approach: The unfolding model of voluntary employee turnover. Academy of Management Review, 19, 51–89.Google Scholar
  54. Leidner, D. E., & Elam, J. J. (1995). The impact of executive information systems on organizational design, intelligence, and decision making. Organization Science, 6, 645–664.Google Scholar
  55. Lind, E. A., Kulik, C. T., Ambrose, M., & Park, M. V. (1993). Individual and corporate dispute resolution: Using procedural fairness as a decision heuristic. Administrative Science Quarterly, 38, 224–251.Google Scholar
  56. Loe, T. W., Ferrell, L., & Mansfield, P. (2000). A review of empirical studies assessing ethical decision making in business. Journal of Business Ethics, 25(3), 185–204.Google Scholar
  57. Lord, R. G., & Maher, K. J. (1990). Alternative information-processing models and their implications for theory, research, and practice. Academy of Management Review, 15, 9–28.Google Scholar
  58. Maertz, C. P., Jr., & Campion, M. A. (2004). Profiles in quitting: Integrating process and content turnover theory. Academy of Management Journal, 47, 566–582.Google Scholar
  59. Maitlis, S., & Ozcelik, H. (2004). Toxic decision processes: A study of emotion and organizational decision making. Organization Science, 15, 375–393.Google Scholar
  60. Margolis, J. D., & Walsh, J. P. (2001). People and profits?: The search for a link between a company’s social and financial performance. Mahwah, NJ: Lawrence Erlbaum Associates.Google Scholar
  61. Maurer, T. J., Pierce, H. R., & Shore, L. M. (2002). Perceived beneficiary of employee development activity: A three-dimensional social exchange model. Academy of Management Review, 27, 432–444.Google Scholar
  62. McCarthy, D. J., & Puffer, S. M. (2008). Interpreting the ethicality of corporate governance decisions in Russia: Utilizing integrative social contracts theory to evaluate the relevance of agency theory norms. Academy of Management Review, 33, 11–31.Google Scholar
  63. McVea, J. (2009). A field study of entrepreneurial decision-making and moral imagination. Journal of Business Venturing, 24(5), 491–504.Google Scholar
  64. Melone, N. P. (1994). Reasoning in the executive suite: The influence of role/experience-based expertise on decision processes of corporate executives. Organization Science, 5, 438–455.Google Scholar
  65. Moll, J., & de Oliveria-Souza, R. (2007). Moral judgments, emotions, and the utilitarian brain. Trends in Cognitive Science, 8(11), 319–321.Google Scholar
  66. Mosakowski, E. (1997). Strategy making under causal ambiguity: Conceptual issues and empirical evidence. Organization Science, 8, 414–442.Google Scholar
  67. Nutt, P. C. (1993). The formulation processes and tactics used in organizational decision making. Organization Science, 4, 226–251.Google Scholar
  68. O’Fallon, M. J., & Butterfield, K. D. (2005). A review of the empirical ethical decision-making literature: 1996–2003. Journal of Business Ethics, 59(4), 375–413.Google Scholar
  69. Perlow, L. A., Okhuysen, G. A., & Repenning, (2002). The speed trap: Exploring the relationship between decision making and temporal context. Academy of Management Journal, 45, 931–955.Google Scholar
  70. Perrow, C. (1999). Normal accidents: Living with high-risk technologies. Princeton, NJ: Princeton University Press.Google Scholar
  71. Plowman, D. A., Baker, L. T., Beck, T. E., Kulkarni, M., Solansky, S. T., & Travis, D. V. (2007). Radical change accidentally: The emergence and amplification of small change. Academy of Management Journal, 50, 515–543.Google Scholar
  72. Ragins, B. R. (2008). Disclosure disconnects: Antecedents and consequences of disclosing invisible stigmas across life domains. Academy of Management Review, 33, 194–215.Google Scholar
  73. Rao, H., Greve, H. R., & Davis, G. F. (2001). Fool’s gold: Social proof in the initiation and abandonment of coverage by Wall Street analysts. Administrative Science Quarterly, 46, 502–526.Google Scholar
  74. Repenning, N. (2002). A simulation-based approach to understanding the dynamics of innovation implementation. Organization Science, 13, 109–127.Google Scholar
  75. Rest, J. R. (1986). Moral development: Advances in research and theory. Praeger, New York.Google Scholar
  76. Reynolds, S. J. (2006). A neurocognitive model of the ethical decision-making process: Implications for study and practice. Journal of Applied Psychology, 91(4), 737–748.Google Scholar
  77. Romme, A. G. L. (2004). Unanimity rule and organizational decision making: A simulation model. Organization Science, 15, 704–718.Google Scholar
  78. Rosman, A., Lubatkin, & O’Neill, H. (1994). Rigidity in belief structures: A within-subject test using strategic and financial informational cues. Academy of Management Journal, 37, 1017–1033.Google Scholar
  79. Schaubroeck, J., & Lam, S. S. K. (2002). How similarity to peers and supervisor influences organizational advancement in different cultures. Academy of Management Journal, 45, 1120–1136.Google Scholar
  80. Seo, M. G., & Barrett, L. F. (2007). Being emotional during decision making—good or bad? An empirical investigation. Academy of Management Journal, 50, 923–940.Google Scholar
  81. Shimizu, K. (2007). ‘Prospect theory, behavioral theory, and the threat-rigidity thesis: Combinative effects on organizational decisions to divest formerly acquired units’. Academy of Management Journal, 50, 1495–1514.Google Scholar
  82. Simon, H. A. (1945). Administrative behavior: A study of decision-making processes in administrative organizations. New York: The Free Press.Google Scholar
  83. Simon, H. A. (1955). A behavioral model of rational choice. The Quarterly Journal of Economics, 69(1), 99–118.Google Scholar
  84. Simon, H. A. (1962). The architecture of complexity. Proceedings of the American Philosophical Society, 106(6), 467–482.Google Scholar
  85. Sitkin, S. B., & Pablo, A. L. (1992). Reconceptualizing the determinants of risk behavior. Academy of Management Review, 17, 9–38.Google Scholar
  86. Sitkin, S. B., & Weingart, L. R. (1995). Determinants of risky decision-making behavior: A test of the mediating role of risk perceptions and propensity. Academy of Management Journal, 38, 1573–1592.Google Scholar
  87. Soelberg, P. (1966). Theories of problem solving and decision making. Cambridge: MIT Press.Google Scholar
  88. Sonenshein, S. (2006). Crafting social issues at work. Academy of Management Journal, 49, 1158–1172.Google Scholar
  89. Sonenshein, S. (2007). The role of construction, intuition, and justification in responding to ethical issues at work: The sensemaking-intuition model. Academy of Management Review, 32, 1022–1040.Google Scholar
  90. Staw, B. M., & Hoang, H. (1995). Sunk costs in the NBA: Why draft order affects playing time and survival in professional basketball. Administrative Science Quarterly, 40, 474–494.Google Scholar
  91. Stevenson, W. B., & Greenberg, D. (2000). Agency and social networks: Strategies of action in a social structure of position, opposition, and opportunity. Administrative Science Quarterly, 45, 651–678.Google Scholar
  92. Sutcliffe, K. M., & McNamara, G. (2001). Controlling decision-making practice in organizations. Organization Science, 12, 484–501.Google Scholar
  93. Takeuchi, R., Shay, J. P., & Li, J. (2008). When does decision autonomy increase expatriate managers’ adjustment? An empirical test. Academy of Management Journal, 51, 45–60.Google Scholar
  94. Tenbrunsel, A. E. (1998). Misrepresentation and expectations of misrepresentation in an ethical dilemma: The role of incentives and temptation. Academy of Management Journal, 41, 330–339.Google Scholar
  95. Tenbrunsel, A. E., & Messick, D. M. (1999). Sanctioning systems, decision frames, and cooperation. Administrative Science Quarterly, 44, 684–707.Google Scholar
  96. Tenbrunsel, A., & Smith-Crowe, K. (2008). Ethical decision making: Where we’ve been and where we’re going. Academy of Management Annals, 545–607.Google Scholar
  97. Tetlock, P. E. (2000). Cognitive biases and organizational correctives: Do both disease and cure depend on the politics of the beholder? Administrative Science Quarterly, 45, 293–326.Google Scholar
  98. Tosi, H. L., Katz, J. P., & Gomez-Mejia, L. R. (1997). Disaggregating the agency contract: The effects of monitoring, incentive alignment, and term in office on agent decision making. Academy of Management Journal, 40, 584–602.Google Scholar
  99. Trevino, L. K. (1986). Ethical decision making in organizations: A person-situation interactionist model. Academy of Management Review, 11, 601–617.Google Scholar
  100. Trevino, L. K. (1992). Moral reasoning and business ethics: Implications for research, education, and management. Journal of Business Ethics, 11(5–6), 445–459.Google Scholar
  101. Trevino, L. K., Weaver, G. R., & Reynolds, S. J. (2006). Behavioral ethics in organizations: A review. Journal of Management, 32(6), 951.Google Scholar
  102. Treviño, L. K., Webster, J., & Stein, E. W. (2000). Making connections: Complementary influences on communication media choices, attitudes, and use. Organization Science, 11, 163–182.Google Scholar
  103. Wade-Benzoni, K. A., Hoffman, A. J., Thompson, L. L., Moore, D. A., Gillespie, J. J., & Bazerman, M. H. (2002). Barriers to resolution in ideologically based negotiations: The role of values and institutions. Academy of Management Review, 27, 41–57.Google Scholar
  104. Wally, S., & Baum, J. R. (1994). Personal and structural determinants of the pace of strategic decision making. Academy of Management Journal, 37, 932–956.Google Scholar
  105. Wang, H. C., & Barney, J. B. (2006). Employee incentives to make firm-specific investments: Implications for resource-based theories of corporate diversification. Academy of Management Review, 31, 466–476.Google Scholar
  106. Weber, J. (1995). Influences upon organizational ethical subclimates: A multi-departmental analysis of a single firm. Organization Science, 6, 509–523.Google Scholar
  107. Weick, K. E. (1979). The social psychology of organizing. Reading, MA: Addison.Google Scholar
  108. Weick, K. E. (1995). Sensemaking in organizations. Thousand Oaks, CA: Sage.Google Scholar
  109. Weick, K. E., Sutcliffe, K. M., & Obstfeld, D. (2005). Organizing and the process of sensemaking. Organization Science, 4(16), 409–421.Google Scholar
  110. Werder, A. V. (1999). Argumentation rationality of management decisions. Organization Science, 10, 672–690.Google Scholar
  111. Wood, R., & Bandura, A. (1989). Social cognitive theory of organizational management. Academy of Management Review, 14, 361–384.Google Scholar

Copyright information

© Springer Science+Business Media B.V. 2011

Authors and Affiliations

  1. 1.Department of Business and EconomicsThe Catholic University of AmericaWashingtonUSA
  2. 2.Darden Graduate School of BusinessUniversity of VirginiaCharlottesvilleUSA

Personalised recommendations