Universal Journal of Management Vol. 5(8), pp. 395 - 403
DOI: 10.13189/ujm.2017.050804
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Paradox of Multi Criteria Decision Making Processes

Gil Greenstein *
Faculty of Technology Management, Holon Institute of Technology (H.I.T), Israel


In the global environment decision makers should considers several aspects. Some of them have contradicted influence, and some aspects are not comparable to others. It leads decision-makers to limited ability of judgment between several aspects. Moreover, in a vibrant world, where technological changes occur in small intervals over time, the considerations of decision makers are changing frequently and dramatically. Thus, decision makers cannot adjust their decision mechanism instantly. This leads us to the need to better understand human decision process. This research presents a new extension of the Information Structure model, which is built using a normative approach in order to understand the mechanisms of multi-criteria decision-making (MCDM) processes. A consequent analysis explains decision-making behavior under the assumptions of bounded rationality. The analysis deals with decision situations, in which it is assumed that a decision-maker cannot formulate a joint utility function constituted from different criteria, which are completely or partially inestimable (intangible). Moreover, the model demonstrates problematic issues of MCDM processes; for example, when the improvement of a service paradoxically leads to a decline in a firm's market share. The model enables implementation of the general informativeness ratio between information structures to such environments. The model is based on the assumption of Bounded-Rationality, that a decision process takes several criteria into account, and handles with a decision-maker that cannot formulate a joint utility function constituted from different criteria. The results of the analysis after applying the model suggest that an optimal solution cannot be obtained; thus, a different approach is proposed – that of optimization subject to rational satisfaction. This approach can be implemented, for example in the design stage of decision support systems (DSS). The method may be implemented for decision situations, in which intangible decision criteria are taken into consideration.

Multi Criteria Decision Making, Decision Support Systems, Bounded Rationality, Information Technology Management

Cite This Paper in IEEE or APA Citation Styles
(a). IEEE Format:
[1] Gil Greenstein , "Paradox of Multi Criteria Decision Making Processes," Universal Journal of Management, Vol. 5, No. 8, pp. 395 - 403, 2017. DOI: 10.13189/ujm.2017.050804.

(b). APA Format:
Gil Greenstein (2017). Paradox of Multi Criteria Decision Making Processes. Universal Journal of Management, 5(8), 395 - 403. DOI: 10.13189/ujm.2017.050804.