Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/233195 
Year of Publication: 
2020
Citation: 
[Journal:] Business Research [ISSN:] 2198-2627 [Volume:] 13 [Issue:] 3 [Publisher:] Springer [Place:] Heidelberg [Year:] 2020 [Pages:] 1231-1251
Publisher: 
Springer, Heidelberg
Abstract: 
The existence of ambiguity presents a challenge to decision-makers as it eliminates the ability to apply standard optimization approaches, such as those based on calculating the objective expected values of alternative actions. In reality, ambiguity arises in most strategically important decisions in some form because of the genuine limits on the decision-maker's rationality and on the information available about the alternatives and the future. To address that reality, we define such problems as strategic decision-making under ambiguity where choices over resource investments must be made in competitive environments where possible outcomes and their payoffs are known ex ante, but the probabilities of such outcomes are unknowable ex ante. We outline a multi-step, logical approach for addressing such problems in theory with the goal of providing an improved basis for practical decisions that should increase organizational performance.
Subjects: 
Ambiguity
Strategic decision-making
Efficient frontier Managerial incentives
JEL: 
B21
D81
G11
M55
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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