Case Analysis: All the Wrong Moves - Nutrorim

CASE ANALYSIS: ALL THE WRONG MOVES

Subject: Individual Behavior in Organization

Section: D Group: 7[pic 1]

Anant Saraogi (2015199)

Pushkar Bhave (2015207)

Irina Rajan (2015215)

Piyush Soni (2015223)

Pushpal Saha (2015231)

Sanjukta Roy (2015239)

Shivendra Pratap Singh (2015247)

Uddipta Bhadury (2015255)

• Introduction[pic 2]

The case study discusses the problem faced by Nutrorim and its CEO, Don Rifkin. Decision making is a critical task in any organization and same is the case with Nutrorim. During the past year, Nutrorim had suffered from a spate of bad decisions. It is a challenge for them to revisit their decision making strategy and come up with new approach for effective decision making.

This case revolves around the product ‘ChargeUp’ and the controversy it faced. It also depicts the merits and de-merits of Nutrorim’s decision making strategy.

• Objectives[pic 3]

To discuss about the decision making strategy of Nutrorim and suggest an effective alternative for the same.

• Main Issues [pic 4]

• Challenges in making critical decisions.

• Avoidance of firm stands by the CEO, Don Rifkin.

• Theoretical Concepts[pic 5]

Decision making occurs as a reaction to a problem. That is, a discrepancy exists between the current state of affairs and some desired state, requiring us to consider alternative courses of action. It is also to be noted that one person’s problem might be another person’s satisfactory state of action.

Every decision involves interpretation and evaluation of information and development of alternatives keeping in mind their strengths and weaknesses. Hence in entire decision making process perceptual distortions often surface that can bias our decisions.

• Rational decision making model:

This model includes number of assumptions including that the decision maker has all the complete information and is able to identify the alternatives in an unbiased manner.

• Bounded Rationality:

It is a process in which decisions are constructed by using simplified models by procuring the essential features from the problems without including all of its complexity.

• Intuitive DecisionMaking:

It is an unconscious process which is created out of the conscious thoughts which basically relies on the holistic associations.

• Errors in decision making:

• Overconfidence bias: It is a well-established bias in which a person’s subjective judgement is reliably greater than the objective accuracy of those judgements.
• Anchoring Bias: It is a tendency to fixate on initial information because of which one fails to adequately adjust for subsequent information.
• Confirmation Bias: In this we seek out information that re affirms past choices and to discount information that contradicts past judgements.
• Availability Bias: It is a tendency to base the judgement on the information which is readily available.
• Escalation of Commitment: It refers to staying with a decision even when there is clear evidence that it is wrong.
• Randomness Error: It is tendency of individuals to believe that they can predict the outcome of random events.
• Risk Aversion: Tendency to prefer sure gain of moderate amount over riskier outcomeeven if the riskier outcome might have higher expected payoff.
• Hindsight Bias: It is tendency to believe falsely, after the outcome is known, that one would have accurately predicted it.

• Individual differences:

Decision making process in characterised by bounded rationality, common biases and errors and the use of intuition. In addition to this individual differences like personality, gender, mental ability and cultural differences also contribute in deviation from the rational model.

• Recommended Solution[pic 6]

Don Rifkin has worked hard to keep the company’s decision making process open and democratic and has always ensured that he considers maximum possible inputs from the associates on a problem.

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