Distributed Decision Making
Distributed decision making (DDM) has become of increasing importance in quantitative decision analysis. In applications like supply chain management, service operations, or managerial accounting, DDM has led to a paradigm shift. The book provides&nb
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Leadership and Coordination Processes
Part III is discussing general leadership questions that may be treated within the framework of distributed decision making. Of course, only a few aspects can be touched, particularly those that lend themselves to a comparatively simple description within the formal concept of hierarchical interactions. On several occasions we already encountered leadership issues, particuB larly in Chapter 5 on agency problems and in Chapter 8 on implementation questions. In addition, Chapter 9 on supply chain management and, of course, Chapter 10 on service operations touched leadership questions. In principal agent settings, the principal is offering incentives, and within the framework of implementation strategies, we explicitly formulated leadership activities as an additional component of the instruction (e.g., see LA in Fig. 8.3). In fact, both strategies are treating leadership problems from a different angle. While in agency theory communication aspects play a predominant role, one has for
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Leadership and Coordination Processes
implementation activities more the problem of how an instruction is actually processed by the (implementing) base-level. In both cases, however, the base-level still plays a more or less passive role. It is only described through the top-level's anticipative planning activities. For a general discussion of leadership problems as part of coordination processes, the base-level should be allowed some reaction, possibly initiating a negotiation between the levels. Hence, leadership questions need an extension and investigation of the general planning framework in at least four directions: - one should achieve a less implicit description of the base-level, particularly regarding the way of processing the top-level's instructions, - the leadership instructions of the top-level should be described in more detail, - the communication process between the levels should be analyzed more carefully, and finally - more space should be given to ad-hoc decisions. In what follows, these four requirements will lead, in Chapter 12, to a reformulation of the coupling equations (2.5), extending hierarchical planning settings to more general DDM systems (see Fig. 2.3). This extension will provide an adequate framework within which typical leadership activities, such as online coordinations and negotiations, can conveniently be described, as will be shown in detail in Chapters 13 and 14, respectively. Particular emphasis will be put on the discussion of the different kinds of instruction and the way how the base-level is handling them. In doing so, it proves to be adequate to raise the theory, we have developed so far, to a higher level of conceptualization (Chap. 12). This enhancement will be achieved in representing the involved decision makers (i.e., the levels) by their individual decision processes, so that the coupling equations will not describe the intervention of just a single top-model with a particular base-model but will involve complete segments of the interfering
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