How Can Generative AI Impact Task Productivity?
Generative AI shifts task productivity by altering how workers allocate time across subtasks and by reducing variance in initial work outputs.
How Can Generative AI Impact Firm Productivity?
Generative AI reduces the marginal cost of producing drafts and ideas, which increases output per unit of time and especially benefits lower skilled workers.
Agency Theory’s Implications on Corporate and Decision Governance
Decision governance operationalizes agency theory by structuring decision rights, information standards, procedural safeguards, and monitoring routines.
Transaction Cost Theory’s Implications on Corporate and Decision Governance
Decision governance provides the operational layer through which firms manage the decisions emphasized by transaction cost theory.
Relationship Between Corporate Governance and Decision Governance
Decision governance focuses on improving decision quality across all organizational forms and can operationalize corporate governance frameworks.
Decision Quality According to the OECD
While there are various other possible qualify criteria to consider, the ones from OECD can be considered a baseline when the aim of establishing decision governance is to improve procedural decision quality.
Key Ideas Leading to the Corporate Governance Concept
Corporate governance evolved from centuries of thought on authority and accountability into today’s concept that covers how power is exercised in and by a corporation.
An App to Assess and Improve Decision Credibility
The app provides recommendations on how to make a decision more credible based on your answers to questions about the decision.
When Is a Decision Credible?
Decision credibility refers to the extent to which a decision and its rationale are perceived as believable, justified, and trustworthy.
Understanding and Governing Decision Interdependence
Decision interdependence describes how much the outcome of one actor’s choice depends on the actions of others.
More Complex Decisions → More Decision Makers?
The complexity and interdependence of a decision problem can influence how many people should participate in decision making.
Number of Decision Makers Influences Information Use
As the number of decision makers increases, organizations must adapt how they collect, share, and synthesize information to maintain decision quality.
More Decision Makers, Less Individual Accountability
Accountability tends to decline as the number of decision makers increases unless explicit mechanisms counteract it. When and why is this the case?
What Helps or Hinders Consensus
Which factors help reach consensus? And which factors make consensus less likely?
An App to Determine If Consensus Is Needed
App helps determine if a decision situation requires consensus, and if so, what kind of consensus.
An App to Pick a Voting Mechanism
The app helps identify the voting mechanism that best fits a decision situation.
Consensus: Common Elements of Consensus Seeking Procedures
What are the common elements among consensus-seeking decision procedures? Why do such procedures differ?
Consensus: What It Is and When to Seek It
Understanding what consensus is—and when it is worth the cost of pursuing—matters for anyone designing or participating in collective decisions.
Decision Making at Scale: How to Choose a Voting Procedure?
If a group needs to vote, how should they choose between different ways to vote? The text covers common voting procedures and uses four case studies for illustration.
Decision Making at Scale: How Number of Decision Makers Influences Decision Speed
How does decision speed vary with the number of decision makers and what governance mechanisms allow an organization to manage this relationship?
Decision Making at Scale: How Coordination and Communication Costs React to the Number of Decision Makers
What are the differences in coordination and communication costs between having 1, 5, 100, and 1000 decision makers in a process to select new product investments?
Decision Making at Scale: Differences between 1, 5, 20, and 100 Decision Makers
This text compares four distinct cases of allocating decision authority – 1, 5, 20, and 100 decision makers – for a hypothetical mid-sized firm revising its product investment process.
When Is Credibility at Risk in Citizen Participation?
This text gives an overview of mechanisms by which credibility is reduced, during decision making that involves citizen participation. A hypothetical story of a participation process gone wrong is used as an example.
Decision Governance in Citizen Participation
What are the typical citizen participation decision making processes? What is common and different across these processes? What implications do these differences have on decisions?
Reputation Condenses Information. Which Other Mechanisms Have A Similar Role?
A reputation mechanism condenses specific information that influences one’s predictions of the behavior of others. What other related mechanisms condense information that is useful when predicting behavior of others?
Decision Complexity and Governance Responses
The degree of complexity in a decision matters because it determines not only the cost of reaching an outcome, but also the kinds of governance mechanisms that need to be in place to guide and monitor the process.
Reputation Mechanisms and Decision Governance
A reputation mechanism reshapes both the design of decision processes and the behavior of decision makers by shifting the basis of authority, incentives, and accountability.
How Bureaucracy Allocates Decision Authority
Bureaucracy remains one of the most enduring forms of coordination. Understanding how decision rights are structured within bureaucracies helps explain both their resilience and their shortcomings.
Necessary Conditions for a Reputation Mechanism
To establish a formal reputation mechanism in a group, six conditions must be met: observable actions, information transmission, information persistence, repeat interaction or interdependence, shared evaluation criteria, and consequences based on reputation.
Reputation Mechanisms: Information-Rich vs Information-Poor Transactions
Reputation mechanisms for information-rich transactions should prioritize interpretation and context, while those for information-poor transactions must emphasize completeness and trust signals.
Reputation Mechanisms: Asset-Specific vs. Generic Transactions
Reputation mechanisms for asset-specific transactions must prioritize long-term reliability and relationship signaling, while those for generic transactions can focus on short-term performance metrics and broad comparability.
Reputation Mechanisms: Spot vs. Repeated Transactions
Reputation mechanisms for spot transactions must focus on immediate trust cues, while mechanisms for repeated transactions should emphasize long-term behavioral consistency and relationship building.
Reputation Mechanisms: Market vs. Non-Market Transactions
Market transactions are structured by price and competition; non-market transactions rely on norms, roles, and relationships—so reputation must serve different goals in each.
Reputation Mechanisms: Key Design Decisions
When designing a reputation mechanism, what are the basic questions to consider?
Transparency: What Influences It, And What It Influences In Turn
How is transparency defined across different research disciplines? What influences level of transparency and, in turn, what does the level of transparency influence?
Transparency: When Is More Better?
What properties should a decision process have, to justify full transparency of all decision information?
Transparency: Is Less Always Worse?
Transparency can help trust and accountability. However, it comes with risks. What are the pros and cons of increasing transparency through decision governance?
How To Measure The Quality of Decision Governance?
Governance has a cost, so we need to know and measure its benefits. This text adapts adapts ideas from the measurement of quality of political governance to decision governance in a firm.
How & Why Does Decision Governance Change?
This text outlines and illustrates eight mechanisms of governance change.
Promises: Using Promises To Evaluate Agent Reputation – Part 3
We explore what happens if the higher reputation increases an agent’s probability to fulfill its promises.
Promises: Using Promises To Evaluate Agent Reputation – Part 2
What if fulfilling a promise increases an agent’s reputation? The framework in this text captures this idea.
Promises: Using Promises To Evaluate Agent Reputation – Part 1
The text presents a framework in which reputation is a function of promises between agents. The framework can be used to create a reputation mechanism to use in decision processes, in multi agent systems, and so on.
Promises: On Relationships Between Promises And Decisions
How is the common sense concept of promise related to decision making behavior in economics?
Reputation: Which Social Factors Influence It, And How
In a group, which factors influence the group’s perception of a decision maker’s reputation? How is that perception formed?
Reputation: Which Psychological Factors Influence It, And How
Which psychological factors influence the perceived motivation of a decision maker, why, and how?
Reputation: Consequences of High And Low Reputation on Decision Making
Reputation is generally defined as the collective perceptions, evaluations, and beliefs that a social group holds about an individual, organization, or entity. How is decision making different if the decision maker has high or low reputation?
How To Enforce A Commitment?
Commitment mechanisms are strategies, agreements, or institutional arrangements deliberately established to ensure adherence to decisions made at an earlier time. How to design them?
Preferences: Why & How To Destabilize Preferences
When is it valuable to destabilize preferences? How can decision governance be used to do it?
Preferences: Why & How To Keep Preferences Stable
When is it valuable for the decision maker to have stable preferences? Which factors can destabilize preferences? How can preferences be stabilized through decision governance?
Values → Preferences: How Values Shape Preferences
An individual’s values, among other factors, influence the preferences that they will have over options in a decision situation. How?