Herbert Simon's Judgemental Model

1. What model of decision making is represented in this case?
Decision making is a process that involves identifying and choosing alternative solutions to achieve desired results. There are two types of models for decision making, rational model and various non-rational models (Kreitner, 2013, p.330). Rational model emphasizes on how decision should be made. While the non-rational models try to explicate how decisions are really made. There are two non-rational models, Herbert Simon’s normative model and the garbage can model. Both non-rational models of descion making are evident in this case. Because non-rational models are based on the assumptions that decision making is uncertain, decision makers do not hold complete information, and it
In this case workers and management used judgmental heuristics in reporting and overlooking the problems. Judgmental heuristics signifies rules of shortcuts that people use to reduce information-processing demands. In making decisions both firms management and rig workers made many mistakes. These mistakes were associated with variety of biases that occurred due to using the judgmental heuristics (Kreitner, 2013, p.335). The specific biases that were present in this case are representativeness heuristic, confirmation bias, overconfidence bias, and escalation of commitment bias. The representativeness heuristic is used when people estimate the probability of an event occurring (Kreitner, 2013, p.336). This bias is present in this case because management of both firms (BP and Transocean Ltd) and rig workers underestimated the probability of the explosion. There were many signs of abnormalities, such as the more fluid was leaving than workers were putting in the well (Kreitner, 2013, p.362). The confirmation bias has two components; first subconsciously decide why it is the right decision before investing in something and second seek information that supports investing in that thing while disregarding information that does not support it (Kreitner, 2013, p.336). This bias is present in this case, because BP choose the design to build the well that was cheaper than the alternative designs by
The model of EBDM has four steps that will help to reduce and avoid the susceptibility to decision making biases with careful, clear, and judgmental use of current evidence in decision making. Step 1 is about identify the problem (Kreitner, 2013, p.338). In this case there were 20 anomalies in the well behavior, but because of disagreements among rig workers and managers of BP and Transocean these problems were ignored (Kreitner, 2013, p.362). Step 2, is about gathering the internal evidence about the problem and evaluate its relevance and validity. If management took the problems reported by the workers seriously and workers compared the old data with the new one, they could be able to evaluate the abnormal behavior of the well. Step 3 is about gathering external evidence of the problem from published research (Kreitner, 2013, p.338). BP officials who had visited the rig few hours before the explosion were aware of the high pressure in the well pipe which was going on from two months. They could have used that evidence to evaluate the problems but instead they believed on the explanation given by the rig workers (Kreitner, 2013, p.362). Step 4 is about gathering views from stakeholders affected by the decision and consider ethical implications. If both firm’s management, choose the disastrous impacts of the problems on