Rational and irrational decision is best for the organization Research Paper

Rational and irrational decision is best for the organization - Research Paper Example This because, formulation of rules and policies requires that the relationship between the organization and its stake holders, as well as its relationship with the outside world is well defined. This being the case, it becomes vital for the process of formulating such rules to apply the rational decision making model, where the issue at hand is clearly defined, the possible problem areas identified, alternatives weighed and a final decision reached (Niu & Zhang, 2009). Additionally, such a situation warrants rational decision making, since the policies and rules formulated form the basis of the organization’s operations. This is yet another situation that calls for managers to apply rational decision. The process of resolving a dispute highly determines the welfare of the parties involved. Thus, reaching a decision that is not well evaluated and reasoned-out can be detrimental to the parties involved (Ariely, 2010). Therefore, it is essential that all the necessary procedures are followed while making such decisions, to ensure that the dispute is resolved amicably, without jeopardizing the interest or welfare of any of the parties involved. Thus, dispute resolution is an aspect of management where rational decision is not an option (Niu & Zhang, 2009). In a situation where a manager is faced by circumstances that dictates that he/she has to act in a certain way only, then irrational decision becomes the best for the organization (Ariely, 2010). For example, during a fire breakout within the organizations premises, the manager has no option but to let the employees free for their safety. This is because; the manager does not have an alternative of retaining the workers within the premises as he/she contemplates on the next move (Knights & Willmott, 2007). Another situation is when the business has to continue running, yet the