Group decision making

Group decision making (also known as collaborative decision making) is a situation faced when individuals are brought together in a group to solve problems. According to the idea of synergy, decisions made collectively tend to be more effective than decisions made by a single individual. However, there are situations in which the decisions made by a collection of individuals are riddled with error, or poor judgment. For example, groups high in cohesion have been noted to have a negative effect on group decision making and hence on group effectiveness.^[1] Risky-shift phenomenon, group polarization, and groupthink are just three examples of the negative consequences that may result from group decision making.^[1] Moreover, when individuals make decisions as part of a group, there is a tendency to exhibit a bias towards discussing shared information (i.e., shared information bias), as opposed to unshared information.

Formal Systems

• Consensus decision-making tries to avoid "winners" and "losers". Consensus requires that a majority approve a given course of action, but that the minority agree to go along with the course of action. In other words, if the minority opposes the course of action, consensus requires that the course of action be modified to remove objectionable features.
• Voting-based methods
  • Range voting lets each member score one or more of the available options. The option with the highest average is chosen. This method has experimentally been shown to produce the lowest Bayesian regret among common voting methods, even when voters are strategic.
  • Majority requires support from more than 50% of the members of the group. Thus, the bar for action is lower than with unanimity and a group of “losers” is implicit to this rule.
  • Plurality, where the largest block in a group decides, even if it falls short of a majority.
• Delphi method is structured communication technique for groups, originally developed for collaborative forecasting but has also been used for policy making ^[2]
• Dotmocracy is a facilitation method that relies on the use of special forms called Dotmocracy Sheets to allow large groups to collectively brainstorm and recognize agreement on an unlimited number of ideas they have authored.

Decision making in social setting

See also: Groupthink

Decision making in groups is sometimes examined separately as process and outcome. Process refers to the group interactions. Some relevant ideas include coalitions among participants as well as influence and persuasion. The use of politics is often judged negatively, but it is a useful way to approach problems when preferences among actors are in conflict, when dependencies exist that cannot be avoided, when there are no super-ordinate authorities, and when the technical or scientific merit of the options is ambiguous.

In addition to the different processes involved in making decisions, group decision support systems (GDSS) may have different decision rules. A decision rule is the GDSS protocol a group uses to choose among scenario planning alternatives.

• Gathering involves all participants acknowledging each other's needs and opinions and tends towards a problem solving approach in which as many needs and opinions as possible can be satisfied. It allows for multiple outcomes and does not require agreement from some for others to act.
• Sub-committee involves assigning responsibility for evaluation of a decision to a sub-set of a larger group, which then comes back to the larger group with recommendations for action. Using a sub-committee is more common in larger governance groups, such as a legislature. Sometimes a sub-committee includes those individuals most affected by a decision, although at other times it is useful for the larger group to have a sub-committee that involves more neutral participants.
• Participatory, where each actor would have a say in decisions directly proportionate to the degree that particular decision affects him or her. Those not affected by a decision would have no say and those exclusively affected by a decision would have full say. Likewise, those most affected would have the most say while those least affected would have the least say.

Plurality and dictatorship are less desirable as decision rules because they do not require the involvement of the broader group to determine a choice. Thus, they do not engender commitment to the course of action chosen. An absence of commitment from individuals in the group can be problematic during the implementation phase of a decision.

There are no perfect decision making rules. Depending on how the rules are implemented in practice and the situation, all of these can lead to situations where either no decision is made, or to situations where decisions made are inconsistent with one another over time.

Social decision schemes

Sometimes, groups may have an established and clearly defined standards for making decisions, such as bylaws and statutes. However, it is often the case that the decision making process is less formal, and might even be implicitly accepted. Social decision schemes are the methods used by a group to combine individual responses to come up with a single group decision. There are a number of these schemes, but the following are the most common:

• Delegating decisions: where an individual, subgroup, or external party makes the decision for the group. For instance, in an authority scheme, the leader makes the decision; or in an oligarchy, a coalition will make the decision.
• Averaging decisions: this is when each individual member makes an independent private decision, which are later averaged together to give a nominal group decision.
• Plurality decisions: where members of the group vote on their preferences, either privately or publicly. The decision will then be based on these votes in a majority-rules scheme, in a more substantial two-thirds majority scheme, or in a Borda count method that uses ranking methods.
• Unanimous decisions: this is a consensus scheme, whereby the group discusses the issue until it reaches a unanimous agreement. This decision rule is what dictates the decision making for most juries.
• Random decision: in this type of scheme, the group will leave the choice up to chance. For example, picking a number between 1 and 10, or flipping a coin. ^[3]

There are strengths and weaknesses to each of these social decision schemes. Delegation saves time and is a good method for less important decisions, but ignored members might react negatively. Averaging responses will cancel out extreme opinions, but the final decision might disappoint many members. Plurality is the most consistent scheme when superior decisions are being made, and it involves the least amount of effort ^[4]. Voting, however, may lead to members feeling alienated when they lose a close vote, or to internal politics, or to conformity to other opinions ^[5]. Consensus schemes involve members more deeply, and tend to lead to high levels of commitment. But, it might be difficult for the group to reach such decisions ^[6].

Moral dimension of decision making

The ethical principles of decision making vary considerably. Some common choices of principles and the methods which seem to match them include:

• the most powerful person/group decides
  • method: dictatorship or oligarchy
• everyone participates in a certain class of meta-decisions
  • method: parliamentary democracy
• everyone participates in every decision
  • direct democracy, consensus decision making

There are many decision making levels having a participation element. A common example is that of institutions making decisions that affect those for whom they provide. In such cases an understanding of what participation level is involved becomes crucial to understand the process and power structures dynamics.

Control-Ethics. When organisations/institutions make decisions it is important to find the balance between the parameters of control mechanisms and the ethical principles which ensure 'best' outcome for individuals and communities affected by the decision. Controls may be set by elements such as Legislation, historical precedents, available resources, Standards, policies, procedures and practices. Ethical elements may include equity, fairness, transparency, social justice, choice, least restrictive alternative, empowerment.

Empowerment is a person's way of expressing control.

Decision making in healthcare

In the health care field, the steps of making a decision may be remembered with the mnemonic BRAND, which includes

• Benefits of the action
• Risks in the action
• Alternatives to the prospective action
• Nothing: that is, doing nothing at all
• Decision

Decision making in business and management

In general, business and management systems should be set up to allow decision making at the lowest possible level. In large coporations like SAP, FAA or European Airport authrity it is conventional to use the term CDM (Collabortive decision making}.

Several decision making models or practices for business include:

• Analytic Hierarchy Process - widely used procedure for group decision making
• Buyer decision processes - transaction before, during, and after a purchase
• Complex systems - common behavioural and structural features that can be modelled
• Corporate finance
  • The investment decision
  • The financing decision
  • The dividend decision
  • Working capital management decisions
  • Cost-benefit analysis - process of weighing the total expected costs vs. the total expected benefits
• Control-Ethics, a decision making framework that balances the tensions of accountability and 'best' outcome.
• Decision trees
  • Decision analysis - the discipline devoted to prescriptive modeling for decision making under conditions of uncertainty.
  • Program Evaluation and Review Technique (PERT)
  • critical path analysis
  • critical chain analysis
• Force field analysis - analyzing forces that either drive or hinder movement toward a goal
• Game theory - the branch of mathematics that models decision strategies for rational agents under conditions of competition, conflict and cooperation.
• Grid Analysis - analysis done by comparing the weighted averages of ranked criteria to options. A way of comparing both objective and subjective data.
• Hope and fear (or colloquially greed and fear) as emotions that motivate business and financial players, and often bear a higher weight that the rational analysis of fundamentals, as discovered by neuroeconomics research
• Linear programming - optimization problems in which the objective function and the constraints are all linear
• Min-max criterion
• Model (economics)- theoretical construct of economic processes of variables and their relationships
• Monte Carlo method - class of computational algorithms for simulating systems
• Morphological analysis - all possible solutions to a multi-dimensional problem complex
• optimization
  • constrained optimization
• Paired Comparison Analysis - paired choice analysis
• Pareto Analysis - selection of a limited of number of tasks that produce significant overall effect
• Robust decision or Robust decision making - method that supports selecting the best possible choice when information is incomplete, uncertain, evolving, and inconsistent
• Satisficing - In decision-making, satisficing explains the tendency to select the first option that meets a given need or select the option that seems to address most needs rather than seeking the “optimal” solution.
• Scenario analysis - process of analyzing possible future events
• Six Thinking Hats - symbolic process for parallel thinking
• Strategic planning process - applying the objectives, SWOTs, strategies, programs process
• SWOT Analysis - Evaluation by the decision making individual or organization of Strengths, Weaknesses, Opportunities and Threats with respect to desired end state or objective.
• Trend following and other imitations of what other business deciders do, or of the current fashions among consultants.
• The use of a Decision making software that provides group decision support.

Decision-makers and influencers

In the context of marketing, there is much theory, and even more opinion, expressed about how the various 'decision-makers' and 'influencers' (those who can only influence, not decide, the final decision) interact. Large purchasing decisions are frequently taken by groups, rather than individuals, and the official buyer often does not have authority to make the decision.

Decision Support Systems

The idea of using computerised support systems is discussed by James Reason under the heading of intelligent decision support systems in his work on the topic of human error. James Reason notes that events subsequent to The Three Mile accident have not inspired great confidence in the efficacy of some of these methods. In the Davis-Besse accident, for example, both independent safety parameter display systems were out of action before and during the event.^[7]

Decision making software is essential for autonomous robots and for different forms of active decision support for industrial operators, designers and managers.

Due to the large number of considerations involved in many decisions, computer-based decision support systems (DSS) have been developed to assist decision makers in considering the implications of various courses of thinking. They can help reduce the risk of human errors.^[8] DSSs which try to realize some human/cognitive decision making functions are called Intelligent Decision Support Systems (IDSS), see for ex. "An Approach to the Intelligent Decision Advisor (IDA) for Emergency Managers, 1999". On the other hand, an active/intelligent DSS is an important tool for the design of complex engineering systems and the management of large technological and business projects, see also: "Decision engineering, an approach to Business Process Reengineering (BPR) in a strained industrial and business environment".

See also

• Shared information bias
• Judge–advisor system

References

1. ^ ^{a b} David Buchanan & Andrzej Huczynski: Organisational behaviour, introductory text Prentice Hall Third Edition 1997
2. ^ http://en.wikipedia.org/wiki/Delphi_method#Use_in_policy-making
3. ^ Hastie; Kameda (2005). 
4. ^ Hastie; Kameda (2005). 
5. ^ Davis et al. (1988). 
6. ^ Kameda et al. (2002). 
7. ^ James Reason (1990). Human Error. Ashgate. ISBN 1-84014-104-2
8. ^ Flyvbjerg, Bent, "From Nobel Prize to Project Management: Getting Risks Right." Project Management Journal, vol. 37, no. 3, August 2006, pp. 5-15.