Decision Theory

Decision theory is the formal analysis of decision making through the systematic evaluation of decision alternatives. Understanding decision theory is important to public relations because the function involves high-level decision making and counseling the dominant coalition on decision alternatives, particularly in the area of issues management. Francis Heylighen defined decision theory in this way: “Decision theory is a body of knowledge and related analytical techniques of different degrees of formality designed to help a decision maker choose among a set of alternatives in light of their possible consequences” (1999, n.p.). This is a noteworthy definition because it covers all areas of decision making, whether based in statistics, ethics, management, public relations, or issues management. Another definition of decision theory, from the McGraw-Hill Encyclopedia of Science & Technology, states, “Decision Theory: A broad spectrum of concepts and techniques which have been developed to both describe and rationalize the process of decision making, that is, making a choice among several possible alternatives” (p. 66). Generally, decision theory falls into the areas of decision making under conditions of certainty, uncertainty or ambiguity, and risk. Much of the literature in the decision discipline discusses its theory as a mathematical framework for reducing uncertainty.

Decision making is a crucial concern for an organization because it impacts all individual and group efforts that take place. Practically every act in public relations is a result of a decision among alternatives. A decision alternative is a viable option in the weighing of various actions the organization could take in managing an issue.

The most commonly occurring theme in decision theory is utility. Utility is a measure of the benefit of each decision alternative, or what that alternative would bring about. In decision theory, expected utility is understood as the possible outcomes of a decision and their usefulness to the decision maker. Decision theory generally holds that the best decision is the one that generates the greatest utility. The concept of utility is related to the moral philosophy of utilitarianism, which holds that a moral decision is that which produces the greatest good, or utility, for the greatest number of people.

Tapan Biswas (1997) said the decision maker is normally conceived in theoretical decision models as a utility maximizer. However, many decision theorists have noted that in reality, people often make choices that are less than maximized, choosing things that will just satisfy their needs; they “satisfice.” Satisficing is based on bounded rationality, in which the decision maker is unable to maximize because of imperfect information but makes do with the information available. Often, imperfect access to and flow of communication was the factor limiting decision making to bounded rationality, sometimes forcing the decision maker to satisfice.

Stephen P. Robbins explained satisficing as “Good enough replaces maximization as a criterion of effectiveness” (1990, p. 263). Because satisficing does not lead to optimal conditions or results, it generally renders a temporary solution. Problems that are not resolved to the satisfaction of all parties, including those decisions that simply satisfice, prove an unstable base for relationship building in public relations. When decisions are made on the basis of satisficing rather than maximizing, it is common for one or more publics to be less than satisfied with the outcome. When that occurs, it is common for publics to reopen the decision to discussion and contention.

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