Question 3: Briefly explain the ration decision-making process.

(10 marks)

Answer: The rational decision-making model is a decision-making model that

describes how individuals should behave in order to maximize some outcome. And the

word ‘rational’ refers to choices that are consistent and value maximizing. Below shows

a model of a rational decision-making.

The model first start with defining the problem and we must deep in mind that a problem

exits when discrepancy between an existing and a desired state of affairs. A given

example would be you have already calculate your expenses on how much to spend and

how much you want to save in the bank, but at the end of the mouth you realize that you

have not follow your actual budget and you have spend more than you save therefore,

you have define a problem. After defining the problem, you have to identify the decision

criteria, which play an important role in how to solve a problem, and this step usually

involves the interests, values and similar preferences of the decision maker. Identifying

criteria is important because different people have different thinking and remember that

any factors not identified in this step are considered irrelevant to the decision-maker. The

criteria, which are identify are rarely equal in importance so, the third step requires to

allocate weights to the criteria in order to give a correct priority in the decision. The

fourth step requires to develop alternatives that could succeed in solving a problem. No

trials would be made in this step because it is just basically to list out them out and once

the alternatives have been listed out, the decision-maker would have to analyze and

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evaluate one by has been listed out through their strengths and weakness and comparing

each of them. And the final step would be selecting the best alternative. Evaluating and

selecting the alternative with the highest total score does this final step.

Below shows the diagram of he decision-making model and a diagram on the result after

using the 6 steps in solving a problem.

Steps in the Rational Decision-Making Model

1. Define the problem

2. Identify the decision criteria

3. Allocate weights to the criteria

4. Develop the alternatives

5. Evaluate the alternatives

6. Select the best alternative

After following closely to each step from the above, it will

- The problem is clear

- A single, well defined goal is achieved
- All alternatives and consequences are known
- Preferences would be much clearer
- No time and cost constraints exist
- Final choices are mostly payoff

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After looking at the diagrams carefully, we have to agree that all the steps involved in the

decision-making process are useful in our daily life and in fact, some of the people

around us are using it to make successful decisions. Real-life examples can be in a

beauty pageant competition, many competitors are present to fight for the crown like

‘Miss Singapore’ and the people who are using the decision-making process steps to

choose the winner are the judges. They first define the problem of each candidate ad they

identify the criteria and after they allocate weights on the criteria, develop the alternative

that are available, evaluate them and select the best alternative which means to say the

best candidate. Therefore, we should also learn how to make wise decisions that we

make could be and impact on our lives or other people lives. By using the decision-

making process, it gives us the directions on how to make wise decisions carefully.

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