Sample Business Studies Essay Paper on Rational Deision Making In Business Organizations

Management Case Study

A top-notch management portfolio calls for making delicate decisions. Some of which may appear bizarre and career suicidal in nature. The decision to save an individual’s job or save the shareholders’ investment has to be borne by the management. Krawcheck, a career manager explored a similar decision to address two similar cases. In one of the cases, the company directors of CitiGroup’s wealth management division had limited confidence in the decisions she settled upon. She, therefore, lost her job while trying to save pensioners’ retirement savings. Her similar quagmire at the Stable Value Fund however created a leeway for her elevation due to the confidence fellow administrators had in her.

Ignoring the plight of the investors however would have begun by tainting her credibility in leadership. Furthermore it would have painted her as a complicit manager who could not forestall mishaps in her department. It would also question her ability to make difficult decisions, some contrary to opinions held by other managers including her superiors. Incurring of losses on investment, especially savings, goes beyond normal business dynamics; it is a case that weighs in on the individual’s conscience. Simon notes that human beings are highly susceptible to make decisions based on their character, which is molded by the day-to-day situations and interactions they interact with. Additionally most weighty decisions basically revolve around the consequences or implications of the decisions taken on the target group (Simon, 1979). Decisions of whichever capacity have to also reflect a humane perspective. Put in a similar situation as Krwacheck, I would have made deliberate moves to save the prospective Walmart pensioners’ investment. Employment can be sought elsewhere but the tag associated with lost investment-fraud, especially in the business fraternity, never quite disappears.

Her decision may have saved CitiGroup’s brand reputation in the market, as leaders in upholding their clients’ welfare. Additionally she saved the company from the cost of litigation processes that would have been initiated by the pensioners in a bid to recover their investment. Merrill Lynch’s wealth management division however, would suffer a soiled societal reputation as a retirements benefit savings society due to loses incurred by the pensioners. Such would have impacted negatively on the confidence of other would be pensioners and savings contributors. Such would cause reduced subscriptions to their savings products. Merrill probably hemorrhaged financially due to probable compensation claims and fines likely incurred from litigation by he pensioners as well as damage control and marketing, to repair their brand in the market.

          From the case scenarios above it is evident that managers and other decision makers within organizations are driven by their gut instinct when making decisions. When their believes are challenged they resign from their positions to save their conscience and integrity from the ramifications of the organization’s decision (Zsambok & Klein, 2014). While indulging her decision, Sallie Krawcheck was informed by the magnitude of the blame that would ensue once the pensioners are unable to get their dues. The burden of her participation, or lack of it would have weighed in on her productivity at the organization.

          The advantage of making decisions that absolve the individual conscience from responsibility for mishaps necessitated by others’ faults is the relative peace of mind that comes with it. Dissociation from pack thinking is an invaluable tool management should embellish. By taking responsibility for the misdeeds of her juniors, Sallie took management practice to the next level. Ideally upon realizing that her juniors had messed up with the pensioners’ funds she should have hastily moved to have their services terminated. She would however negate ideal management practice and make a decision that sacrificed her career to save both her juniors from culpability and the pensioners’ funds. Managers should take responsibility for their juniors’ actions and complicities (Zsambok & Klein, 2014). In so doing her juniors and other departmental managers had an opportunity to learn through the ideals she vouched for.


Simon, H. A. (1979). Rational deision making in business organizations. the American        economic review , 69, 493-513.

Zsambok, C. E., & Klein, G. (2014). Naturalistic decision making. New York: Psychology     press.