RICERCA ITALIANA     

Consonance valuations in the firm's decision-making process: methodologies and instruments

Università degli Studi di Roma "La Sapienza"

Abstract

The environment in which firms operate is changing constantly and rapidly. In this context, the analysis of the causes underlying organizational failures shows that a major role is played by poor decisions taken at various levels of the organizational structure.
The decision-making process appears to be more complex today than in the past, since:
– the number of alternatives in any decision is normally higher and growing, given the openness and interconnection of the global economic and financial system;
– the decision consequences are more difficult to forecast and evaluate, due to the high uncertainty of the environmental dynamics;
– the cost of mistakes is potentially higher, as a consequence of the interdependencies among economic actors and spaces, and the complexity of technologies.
The ever growing embeddedness of economic actions in social relationships leads to assume that the firms’ government cannot be performed without a deep understanding of the social and cultural context in which firms operate.
As a consequence, only a comprehensive view of social, cultural and entrepreneurial processes can form the basis for effective decisions within the firm.
Stemming from these considerations, scholars and practitioners have been searching for new and better models in order to understand the constantly and rapidly changing environment, and support the firms’ decision-making process. Among others, the systemic approach to the >>>

Principal Investigator

Corrado Gatti Università degli Studi di ROMA "La Sapienza"

Research Objectives

The idea of the project is to develop an innovative methodology capable of supporting the decision making process of the firm’s governing body.
In particular, stemming from the assumption that traditional decision support systems offer a flat vision of the decision making process, it is proposed to implement a systemic methodology.
With such methodology we intend to blend scientific reductionism with holism.
Therefore, through the application of the Viable System Approach, we will attempt to build specific instruments able of characterizing the problem space and decision making process of enterprises and, thus, supply sophisticated computational instruments for the analysis of the decision alternatives.
The fundamental idea is to supply the governing body with a decision support system which is capable of interpreting the pressures of supersystems, as well as valuating the effectiveness of decisions over time.
The analysis will not be cause-effect, but will have a relational nature, and will be oriented to examine the relationships that can influence the consonance between the firm and its supersystems.
The objective is, therefore, to develop solutions that can be effectively evaluated in the institutional and socio-economic context of reference, in order to provide a coherent and systematic analysis at the different levels of the decision making process.
The product of our research will be a methodological model implemented >>>

First Results

The main expected result is represented by a valuation model of the decision making processes of organizations. Such a model is expected to have the potentiality to be used in order to develop a decision support software.

Therefore, the final product of the research project will be a conceptual model implemented in a specific software capable of supporting the different phases of decision making.

Timescale

24 months

National and international background

Università degli Studi di Roma “La Sapienza”
The research project of the La Sapienza University unit stems from the basic studies of the Viable Systems Approach to the study and strategic management of the firm. These studies will be integrated by classical studies concerning the stakeholder theory of the corporation and the behavioral theory of decision-making.
Focusing the attention on the Viable Systems Approach, it can be stated that this approach represents a trend in management research which has been developed by bridging the following:
- the systems approach, stemming from Von Bertalanffy's General System Theory, through the contributions of Beer, and Maturana
and Varela (particularly for what concerns the structure-system dichotomy);
- various strategic management approaches as evolution of strategic planning ones. The strategic plan represents a fundamental tool for governing the firm as a viable system: it contains the evolutionary paths of the system where intra and intersystemic dynamics are specified in their risk/reward aspects.
In this context, the firm has been defined as a viable system. The viable system bases its survival capability on value creation, intended as the result of a complex process of adaptation and control of the environment. The quest for value creation depends on the:
a) degree of the firm's consonance with supersystems;
b) degree of the firm's consonance among >>>