DP17664 Using Theories to Make Strategic Decisions
The most fundamental strategic decisions executives make are “unique”. There is no past data or information to ground them. This paper provides a “scientific” approach to frame these decisions. We show how decision-makers should select attributes and use logical links to formulate theories. We also show that they learn by discovering new attributes or logical links that make improbable theories plausible. We apply this framework to some examples and show how it enables decision-makers to frame their strategic problem better and make better decisions.