In any decision process the following elements can be delineated: first, any one choice made in the organization depends on the social system in which the process takes place; second, the process, although not each of the decisions from which it is composed, takes a long time; third, decisions are made under uncertainty; fourth, organizations have goals; and finally, there are many constraints on the freedom of action of the decision-makers to be reckoned with.
A system is a set of interrelated parts. Any organization is a system of individuals, grouped in subsystems according to their role definitions, mutually influencing each other through a continual process of interactions. However, every participant in the organization is not only an involved member of the organization.
They are intimately connected with the wider variety of other systems of which they are a part, and which they cannot ignore. The organization as a whole is also part of superordinate systems: the industry, the community in which it operates, the cultural environment of which it is a part.
All these influence the way problems are defined, alternatives are perceived and selected, and opinions are formulated.‘In order to survive, an organization must achieve what is called “symbiosis”(ie, the mutually beneficial living together of two dissimilar organizations) with a variety of external systems.’The first element in the analysis of any decision process is therefore the organization and environment in which it takes individuals, each with his own goals and aspirations, and which influnces place.
The decision is made within an organization which has established strategy, procedures and standard operating policies, which is composed of different individuals, each with his own goals and aspirations, and which is influenced by other, superordinate systems.
The organization has devised an established ‘way of doings things’ according to agreed-upon goals and past experience; these rules and specifications influence the behavior of its members, the information gathered by them and their adaptive reactions to the environment. Moreover, individuals within the organization.
These relations will influence any specific decision. Those making the decision will have to continue acting for the same organization and interacting with various people in and outside it long after any specific decision is made or implemented.
Consciously or unconsciously, they will weigh these future relations throughout the decision process. For example, one may choose a certain course of action because somebody else, to whom one feels an obligation for a favour done in the past, prefers it. One may also take a course of action because one feels that another decision will harm future relations with someone else inside or outside the organization.
These future relations.
A foreign investment decision process is a very complicated social process, involving an intricate structure of attitudes and opinions, social relationships both in and outside the firm, and the way such attitudes, opinions and social relations are changing. It contains various elements of individual and organizational behavior, influenced by the past and the perception of the future as well as by the present.
Investment decisions in business are based on the alternatives which are known to exist, or those which have emerged from previous activities of the business unit. The forces leading an organization to consider the possibility of launching a project outside the United States might be classified into those arising within the organization and those exogenous to it, stemming from its environment.
In the first category are forces arising from a strong interest by one or several high-ranking executives inside the organization. The very fact that an organization is making an investigation creates new commitment
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