Annotated Bibliography on Decision-Making under Uncertainty

This annotated bibliography examines the concepts of certainty and uncertainty in decision-making, drawing from three key research papers. Pouget, Drugowitsch, and Kepecs (2016) explore the distinct probabilistic quantities of confidence and certainty, highlighting their relationship and how they differ in various conditions. Merigo (2015) introduces a model that unifies risks and uncertain environments in strategic management, contrasting decision-making under certainty, where full information is available, with uncertainty, where information is incomplete. Armbruster and Delage (2015) further elaborate on these conditions, emphasizing the predictability of certainty versus the unpredictability of uncertainty, especially concerning external factors like market demand and competitor actions. The bibliography offers a comprehensive view of how leaders approach decision-making in varied conditions, providing valuable insights for strategic management.

Running head: ANNOTATED BIBLIOGRAPHY
ANNOTATED BIBLIOGRAPHY
Name of the Student
Name of the University
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Confidence Certainty and Uncertainty
Pouget, A., Drugowitsch, J., & Kepecs, A. (2016). Confidence and certainty: distinct
probabilistic quantities for different goals. Nature neuroscience, 19(3), 366.
This study describes the conditions of certainty and the confidence are closely related and
this study describes that both the concepts are quiet same. This study shows how the certain
conditions are different from the uncertain conditions. The study describes that the certainty and
the confidence are related as the business leader gets confidence while taking any decisions as
the conditions are already known to them from the previous experiences.
The conditions of decision making under certainty means that the conditions of the certainty
exists when the decision maker knows that with the reasonable certainty that is what are the
conditions that are associated with each of the alternatives and the outcomes of each alternatives.
The decision those are made under the conditions of certainty will be more accurate, measurable
and the reliable informations those are based on the decisions that are available. As stated by
Pouget (2016), the cause and the effect relationships are mostly known for this type of decision
making process. This also stated that the future are highly predictable under the conditions of
certainty. Such conditions are mostly found to be existing in the case of the routine and the
repetitive decisions that are concerned with the day to day operations of the business process.
Kepecs (2016), stated that the significant decisions are made in now a day’s complex
environment that are formulated under the state of uncertainty. The conditions of uncertainty
exists when the future environment is unpredictable and everything deals with the state of flux.
The decision maker is also not aware of the fact of the available alternatives and the risks that are
associated with each and the consequences of each of the alternatives and the probabilities. Even

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in this type of decision making process under uncertainty, the manager also does not possess the
proper information regarding the alternatives and the information those are available may not be
reliable. In such phases of uncertainty, managers are required to make complete assumptions
regarding the situations for providing the reasonable frameworks for the decision-making
process. The manager and the leaders are required to depend upon the judgment and experiences
for making decisions. Although there are several modern approaches made upon for improving
the quality of decision making under the condition of uncertainty.
Therefore, this study concludes that the confidence could be described as the probability that the
decision taken is correct by the given evidence. This study suggests that the term certainty could
be referred to the encoding of the probability distributions over the sensory and the cognitive
variables.
Decision-making under uncertainty and certainty
Merigo, J. M. (2015). Decision-making under risk and uncertainty and its application in
strategic management. Journal of Business Economics and Management, 16(1), 93-116.
This study introduces the new decision making model that unifies the risks and the
uncertain environments in the same formulation. This study also provides the decision making
conditions under uncertainty and how is it different from the certain conditions in the decision
making process. This study also focused on the multi person decision making problem in the
strategic management.
The conditions under the certainty are considered as the decision maker that has full
information required for making the decision as the decision is made under the condition of the
certainty. The manager are required to know the details of what the outcome will be as he has

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enough clarity regarding the situation. Manager also knows about the resources and the time
available for making decisions, the nature of problems and the solutions for solving such
problems. As commented by Merigo (2015), in most of the situations, the solutions are already
available from the past experiences or situations that are appropriate for the problems at hand.
For example: the decision to restock the food supply that is when the goods are in stock, they
may fall below for the determined level is considered as the decision making under the
circumstances of the certainty.
This study also describes the condition of uncertainty as compared to the condition of
certainty. The condition of uncertainty provides the incomplete informations, many unknown
and the possibilities for predicting the expected results for determining the decision making
alternatives. In this case the manager cannot even assign the subjective probabilities of the likely
outcome of the alternatives. This study finds out that the each of the possible states of the
problems causes that the manager himself are unable to predict with confidences that what are
the outcomes of the actions to be. Manager does not have any informations regarding the
intuitive judgments that are based upon assigning the probabilities to each state of nature. In such
cases of uncertainty the manager could have come up with the creative approaches and the
alternatives of the problems. This may even cause panic and the environment uncertainty among
the employees that leads to the uncertain decision.
Therefore this study concluded that the study are able to construct the new aggregation operator
through which the study can call the multi person operator. The main advantage through which
the study deals with opinions of the opinions of the several person for representing the
informations in the more complete manner.
Decision making under the condition of Certainty vs Uncertainty condition

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Armbruster, B., & Delage, E. (2015). Decision making under uncertainty when preference
information is incomplete. Management science, 61(1), 111-128.
This study elaborate the condition of the certainty are quiet predictable for manager as
well as the leaders for dealing with the problems. The manager and the leaders are able to make
decisions as per the predictions they have gained from the previous cases. The decision making
environment becomes more predictable for the business. But whereas in cases of the uncertainty,
managers or leaders are unable to predict the consequences of the decision they will be taking,
thus the entire decision making process remain unpredictable for the business. There are risk
probability while making decisions under the condition of uncertainty as the consequences are
fully unknown to the manager or business leader.
The decision making conditions under certainty is mainly based on the event that may
take place. As stated by Delage (2015), the decision making under the condition of certainty is
quiet difficult for finding the complete certainty in most of the decisions made by the business.
In the cases of the routine type decisions, the complete certainty can be noticed. Also stated by
Armbruster (2015), in the environment of uncertainty, the author declared that in such condition
more than one type of events could take place and the decision maker is entirely in dark
regarding the event that will be likely to take place. In such condition, the decision maker is not
in the position even for assigning the probabilities of happenings of the events.
Therefore this study concludes that such situations mostly arise in the cases where the
happenings of the event is also determined by the external factors like the demand for the
products, the moves for the competitors are the factors which involves uncertainty.

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References
Armbruster, B., & Delage, E. (2015). Decision making under uncertainty when preference
information is incomplete. Management science, 61(1), 111-128.
Merigo, J. M. (2015). Decision-making under risk and uncertainty and its application in strategic
management. Journal of Business Economics and Management, 16(1), 93-116.
Pouget, A., Drugowitsch, J., & Kepecs, A. (2016). Confidence and certainty: distinct
probabilistic quantities for different goals. Nature neuroscience, 19(3), 366.