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Robustness as a corporate objective under uncertainty
Author(s) -
Dorward Neil,
Wiedemann Paul
Publication year - 1981
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.4090020308
Subject(s) - robustness (evolution) , certainty , decision maker , flexibility (engineering) , function (biology) , computer science , operations research , economics , management science , mathematical optimization , mathematics , management , biochemistry , chemistry , geometry , evolutionary biology , biology , gene
This paper examines the nature of the objective function of the firm when operating under conditions of uncertainty. Robustness is presented as a purposeful maximand for decision making both under conditions of certainty and uncertainty ‐ a robust decision being one in which the decision maker retains the maximum flexibility with regard to future decisions after an initial decision has been made. Its incorporation within a managerial objective function provides a measurable scale for making choices between alternative courses of action, including under conditions of internal organizational conflict and environmental reaction by other decision makers.