Decision making with other members in organization is very important because every action needed decision making, planning a business, managing performances, care the employee and customers, every time every actions based on decision making. Then, how can we make a good decision?
Rational choice paradigm
Decision making is the conscious process of making choices among alternatives with the intention of moving toward some desired state of affairs. The ultimate principle of the rational choice paradigm is to choose the alternative with the highest subjective expected utility. And we can use the rational choice decision making process that there’s six step to do. The first step is to identify the problem or recognize and opportunity, and the second step involves deciding how to process the decision. After decided the process, you can identify and develop a list of possible solution, and choose the alternative with the highest subjective expected utility. The fifth step is to implement the selected alternative. And evaluating whether the gap is last step of rational choice decision-making process.
In this case study that Solvay group, we would like to focus on the decision making process.
Solvay, a Brussels based international chemical & pharmaceutical group is doing their business internationally, Europe, NAFTA, Mercosur, and Asia Pacific. And 28,000 employees belong to Solvay group in 2007. Net Sales of three division of Solvay is over € 28,000 millions. Solvay grown by of M&A, and it’s base to form the current divisions and business architectures.
Marcel Lorent, HR manager for international Mobility at Solvay should have to decide four expat processes, but those four expat is not unusual cases, so he is on dilemma.
According to rational choice decision-making process, it’s based on aware the information with member who is relative with decision making. Because of to identify problem and opportunity, they must know about situation exactly. Then you can discuss with other members and find what it happened. But, Solvay and Lorent didn’t follow that rules. To listen the voices of employee, Lorent visit them whole in the world where they worked. This is very hard to listen the current voices of employee wanted. In additions, employee is hard to talk about their visions because of Solvay organization culture that is too formal. When employee wants to change their career, they should tell their senior manager. But in the organization, this is so hard to tell their senior manager.
* Historically, Solvay’s mobility policies had focused on consistency. But with Lorent, HR
manager of International Mobility, he himself had experienced as an expatriate who moved to HR part from plant running career for over 25 years. So the intuition made him to wondered whether should he rethink his groups’ approach to Solvay’s mobility expat process. This can be seen as an intuition, since it is a gut feeling based on his experience. * In response to a changing world and with new and with important developments lying ahead,
Solvay began in 2009 to turn a major corner in its history. The paradigm of the pharmaceutical industry has led the BOD to take a crucial strategic decision : to divest Solvay Pharmaceuticals.
This decision was allowed to mature slowly and carefully and was finally taken only after a detailed study of alternatives. * This kind of strategic decision always require of Leader’s Intuition at some level. In a business world where the uncertainty become an unavoidable part, the intuition becomes more and more important to all organization .
ESCALATION OF COMMITMENT :
* The decision of quitting Pharmaceutical business is also an simple of not falling to “Escalation of Commitment” before too late. From 1980, Solvay formed its “health sector” and even...