Composition vs. Decomposition: Two Approaches to Modeling Organizational Decision Processes

The most popular approach to developing mathematical models of organizational decision processes, the decomposition approach, begins with a mathematical statement of an ideal organizational problem and follows a process of decomposition to derive sub-problems solved by separate units at (possibly) different levels of the organization. Conversely, the composition approach starts with mathematical statements of the subproblems solved by the separate units and proceeds to develop a solution algorithm as a means of coordinating the activities of the separate units. A process of composition must then be followed if one is to discover the derived organizational problem actually solved. This paper offers an operational definition of an organizational decision process and relates this process to the anatomy of mathematical models purported as being representative of it. Implications regarding the potential of the decision process models as tools of organizational design are explored.