Abstract
This thesis tackles organisational viability problems, encountered in the usage of linear programming-based financial planning models for strategic decision-making. In particular, the research uses systems concepts and empirical evidence from previous studies to develop and theoretically justify the hypotheses that:- organisational viability can be enhanced significantly in that state in which the organisation effectively balances its structural composition with its capability for environmental capital mobility;
- the unsystematic cost of capital component is, in reality, the social discount rate, while the systematic camponent comprises the business, financial and security-marketability risks;
- satisficing logico-mathematical models are the most suitable for effective organisational strategic financial planning.
A planning concept is developed, termed ‘viability planning', defined as planning to maintain an adaptive, efficient and effective structural composition. This concept is elaborated as a decision-making modelling methodology, using (in an ‘Interaction Tableau') a set of organisational characteristics whose inherent
synergy has to be maximised as a prerequisite for sustaining organisational viability. A decision-analysis model in a non-preemptive goal-programming framework is proposed to obtain the optimal synergy-scenarios, that should subsequently be considered in a preemptive model framework for ranking, weighting and satisficing. A logical extension of the theoretical framework
of sensitivity analysis is proposed for satisficing, deriving trade-off weights either by analysing the relationship between deviational variables in satisfying specified goal-constraints, or by optimising total trade-off value between the different non-daninated solutions obtainable from the multiple desirable
objectives. Finally, using a program developed on a Harris-800 computer, various aspects of the viability planning concept are experimentally tested in a case study of a holding company.
It is concluded that organisational viability modelling problems could be minimised by incorporating the capitalised-cost structure in a multi-criteria decision-making framework, the primary considerations being optimality of synergy and appropriate balancing of the preference and trade-off weights (both of which are confounded in current model-applications).
Date of Award | 1985 |
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Original language | English |
Awarding Institution |
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Keywords
- Organisational Viability
- Multi-criteria Models
- Synergy
- Capitalised-cost Structure
- Satisficing