School of Management Faculty of Business and Law Perceptions of Decision-Making in Western Australian Iron Ore Companies Dealing with Chinese Companies. Renée Leong Yen-Yen This thesis is presented for the Degree of Doctor of Business Administration of Curtin University August 2019 Declaration of Originality To the best of my knowledge and belief this thesis contains no material previously published by any other person except where due acknowledgment has been made. This thesis contains no material which has been accepted for the award of any other degree or diploma in any university. The research presented in this thesis was conducted in accordance with the National Health and Medical Research Council National Statement on Ethical Conduct in Human Research 2007 – updated 2018. The proposed research study received human research ethics approval from the Curtin University Human Research Ethics Committee. The Approval number is RDBS-54-15. Signed: ______________________________ On: 31 August 2019 ii Table of Contents Declaration of Originality .............................................................................................. ii Table of Contents ........................................................................................................... iii List of Figures ................................................................................................................ vii List of Tables .................................................................................................................. ix Acknowledgements ........................................................................................................ xi Abstract ......................................................................................................................... xiii Chapter 1: Introduction ................................................................................................. 1 1.1 Decision Making ............................................................................................................ 1 1.2 Trade between Western Australia and China ................................................................. 1 1.3 Looking Ahead ............................................................................................................... 2 1.4 Research Objectives ....................................................................................................... 3 1.5 Research Questions ........................................................................................................ 3 1.6 Operational Definitions .................................................................................................. 3 1.7 Literature Review ........................................................................................................... 4 1.8 Methodology .................................................................................................................. 4 1.9 Findings and Analysis .................................................................................................... 5 1.10 Discussion and Conclusion .......................................................................................... 5 Chapter 2: Literature Review ........................................................................................ 6 2.1 Introduction .................................................................................................................... 6 2.2 History of Decision Making ........................................................................................... 7 2.3 Western Australia Iron Ore Industry with China ......................................................... 11 2.3.1 Definitions of Decisions and the Concept of Decision Making .............................. 16 2.3.2 Strategic Decision Making ....................................................................................... 19 2.4 Decision Theory ........................................................................................................... 21 2.4.1 Normative Approaches ............................................................................................ 22 2.4.2 Descriptive Approaches ........................................................................................... 23 2.4.3 Rational Theories ..................................................................................................... 24 2.4.4 Choice ...................................................................................................................... 27 2.4.5 Emotion .................................................................................................................... 28 2.5 Models of Decision Making ......................................................................................... 30 2.5.1 The Rational Model ................................................................................................. 31 2.5.2 The Bounded Rationality Model .............................................................................. 35 2.5.3 The Organisational Model ....................................................................................... 37 2.5.4 The Political Model ................................................................................................. 38 2.5.5 The Process Model ................................................................................................... 39 2.5.6 The Garbage-Can Model ......................................................................................... 40 2.6 Organisational Decision Making and its Structure ...................................................... 42 2.6.1 Decision Making in a Simple Organisation Structure ............................................. 44 2.6.2 Decision Making in a Hierarchical Organisation Structure ..................................... 44 2.6.3 Decision Making in a Functional Organisational Structure ..................................... 45 2.6.4 Decision Making in a Divisional Organisational Structure ..................................... 47 2.6.5 Decision making in a Matrix Organisation Structure .............................................. 48 2.6.6 Decision Making in a Network Structure ................................................................ 51 iii 2.6.7 Decision Making in Centralised and Decentralised Organisations ......................... 54 2.7 Group Decision Making ............................................................................................... 58 2.8 Groups Making Decisions ............................................................................................ 61 2.8.1 Vroom – Yetton Participative Model ....................................................................... 61 2.8.2 The Nominal Group Technique ............................................................................... 64 2.8.3 The Brainstorming Technique ................................................................................. 65 2.8.4 The Delphi Technique ............................................................................................. 65 2.8.5 Groupthink ............................................................................................................... 67 2.8.6 Devil’s Advocate ..................................................................................................... 69 2.9 Decision Making in a Complex Environment ............................................................. 70 2.9.1 Complexity Theory and Complex Adaptive Systems (CAS) .................................. 72 2.9.2 Complexity Theory .................................................................................................. 73 2.9.3 Understanding Complexity — A Process of Decision Making ............................... 75 2.9.4 The Cynefin Framework .......................................................................................... 76 2.10 Decision Making and Cultural Intelligence in the Australian Context ...................... 82 2.10.1 Socio – Cultural Aspects of Decision Making in Australia and China ................. 82 2.11 Cultural Intelligence ................................................................................................... 85 2.11.1 Cultural Intelligence – Individual Level ................................................................ 85 2.11.2 Framework of Firm-Level Cultural Intelligence ................................................... 86 2.11.3 Managerial Cultural Intelligence ........................................................................... 88 2.11.4 Metacognitive Cultural Intelligence ...................................................................... 88 2.11.5 Cognitive Cultural Intelligence .............................................................................. 89 2.11.6 Behavioural Cultural Intelligence .......................................................................... 89 2.11.7 Competitive Cultural Intelligence .......................................................................... 90 2.11.8 Structural Cultural Intelligence .............................................................................. 91 2.12 Hofstede’s Cultural Dimensions ................................................................................ 92 2.12.1 Power Distance ...................................................................................................... 93 2.12.2 Individualism/Collectivism .................................................................................... 95 2.12.3