Exploration-Exploitation Trade-off In Sequential Decision Making : A Vocational Behaviour Context

Abstract

Decision making strategies are a key distinguishing factor for business functioning as they contribute significantly to individuals’ (organizations’) success or failure. Often, the failure to achieve a decision goal, is not indicative of an incompetent decision-maker. We argue that, decision related failures occur because decision-makers are challenged by a mis-matches between decision behaviour and the requirement for the project. For businesses, these mis-matches result in projects’ strain, going over-budget, business losses, unplanned investments, and undesired organization culture. Likewise, in addition to financial and/or reputation losses at individual level, mis-matches often lead to further investments in hopes of justifying previous investments. The impacts of decision strategy mis-matches are significantly less in isolated decision problems, compared to sequential decision problems, because the strategies applied in sequential problems create the over-arching decision culture for the individual or firm. This research aims to mitigate losses associated with decision strategy disagreement between; organizations and employees, projects and decision makers, and desired career pathway and capital investments through the enunciation of exploration-exploitation behaviours. We approached the aforementioned problem investigating exploratory-exploitative behaviours to uncover behavioural development predictors and optimise the selection of individuals that occupy decision making roles. Following a mixed-method approach, a behaviour variability conceptual model was developed, adapting practice and life-history theory (LHT). Identified forms of capital were explored as predictors that enable exploration-exploitation trade-off. The models were subsequently evaluated using two quantitative studies followed by a confirmatory qualitative study. Further estimating the interaction effects of time and recognition of competencies on the measured causal relationships of capital forms in exploratory-exploitative decision behaviours. This research makes empirical contributions by, demonstrating that, forms of capital (economic, experience, symbolic, social, human, cultural) owned by individuals, significantly predict exploratory-exploitative decisions behaviours, especially in vocational contexts. Experience was the most important predictor of exploratory-exploitative behaviour. Research results show that, its influence on decision behaviours can be manipulated, through adequate valuation of skills, competencies and/or creating opportunities that expose individuals to behaviour specific decision environments. This research also contributes by enunciating that, capital factors do inspire more (less) variability in decision behaviours and behaviours differ contingent of the individual’s maturity. Specifically, they highlight; (1) the key role symbolic capital (skill, competence and time investment recognition), play in building ambidextrous individuals; and (2) the strategic impact of subsidising career taxes for employees/personnel. Furthermore, the study found that economic capacity impacts decision behaviours significantly. Its impact cannot be entirely overcome, but can be curtailed through shared goals, investment collaboration between the decision maker(s) and their primary stakeholder(s). Managerial implications of current research include; the provision of metrics for evaluating and aligning talent acquisition, optimising selection programmes and continuous professional development (CPD) investments. We also reinforce, the strategic impact of subsidising career taxes for employees/personnel and offering symbolic recognition. Theoretically, it bridges the dearth of research on modelling individual exploration-exploitation decision behaviours. Lastly, this research makes conceptual contributions, by enunciating tacit economic influences in careership, which led to the development of a career-tax concept, useful for categorizing these tacit career costs.

Date of Award	25 Jun 2020
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Nadia Papamichail (Main Supervisor), Yu-Wang Chen (Co Supervisor) & Richard Allmendinger (Co Supervisor)