Notes on Bonded Rationality
Rahul's Noteblog Notes on Principles and Practices of Management Notes on Bonded Rationality
What is Bonded Rationality?
Also known as limited rationality, bonded rationality is useful when the future cannot be predicted. Meaning, it is difficult to be completely rational because of future uncertainties, and unrecognizable decision alternatives. In this situation, a manager must settle for bonded rationality, that is, "play it safe." According to management expert Herbert Simon, a manager should pick a course of action that is satisfactory or good enough under the circumstances.
Additional Readings:
1. Functions of a Business Manager
2. Henry Fayol and Modern Management Theory
3. Modern Management Thoughts and McKinsey's 7-S framework
4. Industrial Planning
5. Management and Setting of Objectives
6. Principals of Organization
7. Matrix Organizations
8. Functions of the Human Resources and Accounting within an Organization
9. Differentiation between Motivation and Satisfaction
10. Barriers to Good Communication
11. Requirements of Effective Controls
12. Formal and Informal Organizations
13. Bonded Rationality
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