Rationality in Information Systems Support to Decision Making

Abstract

Management information systems serve business organizations by providing information for decision making. Various types of systems serve different types of decision contexts. The philosophic basis of information system support is discussed. The rational (or normative) philosophy is widely used, and appears in business theory in the form of agency theory and transaction cost analysis. While this approach has been valuable in some contexts, there are other contexts where the rational approach has limited in utility for real business decision making. Decision makers need to consider subjective factors to enable them to cope with the high levels of uncertainty, incomplete understanding, and imperfect data typical of dynamic open systems. There are alternative philosophies upon which to base decision-making that are appropriate for specific decision contexts. Churchman identified empirical, multi-perspective frameworks, dialectic, and cause-and-effect inquiring systems as alternatives to the rational (normative) system. A number of information system tools, such as decision support systems, expert systems, and group support systems can be supported by models based on philosophies other than rational models. A more empirically based philosophy, with decision-makers balancing hypothesis generation and observations of performance, is often more appropriate. The relationship between Churchman's inquiring systems and information system types are discussed.