How Rational Should a Manager be?

Abstract

It is often rightly stressed that research workers should learn how to sell their work to managers, by avoiding technical jargon, and by otherwise acquiring skill in exposition. But managers often take a step towards the research men by learning a little science. I wish to advocate that managers should learn to use a little of the language of the theory of rationality, to make judgments of inequalities between probabilities and between utilities, and to understand what it means to be reasonably consistent. In my opinion the consequences would be a great increase in the value of operational research. A brief description of what I mean by rationality is followed by a tentative definition of "degrees of rationality." Here it seems to be necessary to make use of the notion of rationality of "types I and II." The remainder of Section 3 is concerned with an elaboration of some aspects of rationality that seem to me to be important, and either somewhat novel or not often enough emphasized in print. In Sections 4 and 5 some of the benefits and difficulties associated with the use of the theory are mentioned.