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358 Decision framing and cognitive inertia
decline in its viewing figures over the past two years. There are several
possible frames:
(1) The program makers argue that a lack of funds to develop quality
programs has led to the problem. To them, the courses of actions that
need to be considered include reducing administrative overheads
to free resources for programs, or increasing advertising rates to
generate more funds.
(2) In contrast, the station’s marketing managers blame a lack of investment
in marketing. From their perspective, if they can obtain a larger
budget, the key decision is: what is the best way to assign marketing
funds to raise the profile of the station?
(3) Finally, a media consultant argues that the decline has occurred
because the station has lost touch with its target audience – young
viewers. Its programs have failed to move with the times and now
look staid and old fashioned. The key decision is how to change the
character and mix of the programs and develop new ones.
Frames are bound to be simplifications of real problems and each of
them will only give a partial view of the decision problem. Difficulties can
arise when a single frame is used unquestionably by managers, perhaps
because of habit or professional specialism. This ‘frame blindness’ can
lead to a failure to identify creative new solutions. It might also mean
that a company continues to do business as it has always done – ignorant
of the fact that its environment has fundamentally changed and that a
complete rethink of its operations is required. We next discuss some
problems that can arise because of decision frames and then suggest
ways of avoiding these problems.
From the 1940s to the 1970s US car manufacturers used mathematical
methods to determine the optimum length of production runs of
particular car models. Changing from the production of one model to
another took time while machinery was set up or reconfigured. This
changeover time, which was taken to be between 6 to 8 hours, led to a
loss of production so frequent changes were undesirable. On the other
hand, production runs that were too long led to high inventory levels
and hence high inventory holding costs. The mathematical models were
designed to identify the length of run which gave the best balance
between the costs arising from lost production and the inventory costs.
Japanese manufacturers, particularly Toyota, framed the problem
differently. They focused on reducing the changeover time (which US
manufacturers assumed was fixed) and eventually got it down to 44
seconds. This saved thousands of dollars of production costs compared