What Is Satisficing?
Satisficingis a decision-making strategy that aims for a satisfactory or adequate result, rather than the optimal solution. Instead of putting maximum exertion toward attaining the ideal outcome, satisficing focuses on pragmatic effort when confronted with tasks. This is because aiming for the optimal solution may necessitate a needless expenditure of time, energy, and resources.
The satisficing strategy can include adopting a minimalist approach in regard to achieving the first attainable resolution that meets basic acceptable outcomes. Satisficing narrows the scope of options that are considered to achieve those outcomes, setting aside options that would call for more intensive, complex, or unfeasible efforts to attempt to attain more optimal results.
Key Takeaways
- Satisficing is a decision-making process that strives for adequate rather than perfect results.
- Satisficing aims to be pragmatic and saves on costs or expenditures.
- The term “satisfice” was coined by American scientist and Nobel laureate Herbert Simon in 1956.
- Customers often select a product that is good enough, rather than perfect, and that’s an example of satisficing.
- A limitation of satisficing is that there is no strict definition of an adequate or acceptable outcome.
What Is the Application of Satisficing?
The theory ofsatisficingis explained by cognitive heuristics, behavioral science, and neuropsychology. Its application is found in a number of fields, including economics, artificial intelligence, and sociology. Satisficing implies that a consumer, when confronted with a plethora of choices for a specific need, will select a product or service that is “good enough,”rather than expending effort and resources on finding the best possible or optimal choice.
If a consumer were to require a tool to process and resolve a problem, under asatisficingstrategy, they would look to the simplest, most readily accessible piece of equipment, regardless of more effective options being available at greater cost and time. For instance, satisficing might include the use of a single software title vs. procuring an entire software suite that includes supplemental features.
Why Do Organizations Adopt a Satisficing Strategy?
Organizations that adoptsatisficingas a strategy might seek to meet the minimal expectations for revenue and profit set by the board of directors and other shareholders. This contrasts with attempting to maximize profits through concerted efforts that put higher demands on the performance of the organization across sales, marketing, and other departments.
By aspiring to more attainable targets, the effort put forth may be equitable with the final results. Such a strategy might also be applied if a company’s leadership chooses to put only a nominal effort toward one objective in order to prioritize resources to achieve optimal solutions for another goal. For example, reducing staffing at a tertiary work site to minimal operational levels could allow for personnel to be reassigned to other divisions and projects where more substantial labor is required for maximized results.
A limitation of satisficing is that the definition of what constitutes a satisfactory result has not necessarily been determined, nor is it universally clear that such a result differs from the pursuit of an optimal outcome.
What Is Satisficing Behavior?
Coined by Nobel laureate Herbert Simon in 1956, “satisficing” is a form of decision making where individuals choose the acceptable option, rather than the optimal one. In essence, it combines the words “satisfy” and “suffice.” Under this theory, Simon suggested that people make decisions under “bounded rationality,” with factors like time, control of the situation, and one’s limitations affecting the individual’s behavior.
What Is an Example of Satisficing?
Consider the following example of an executive who is a “satisficer”—in other words, they are prepared to act once they have enough information to be satisfied. The executive is looking for a tech developer in order to launch a new app. Among all the candidates, a few meet all the criteria, although none clearly stands out above the rest or seems to be an optimal fit. Instead of looking for a better-suited fit, the executive hires the developer since they are under a tight schedule, and waiting for the perfect candidate may delay the timeline.
What Is the Difference Between Satisficing and Maximizing?
Satisficing and maximizing are two forms of decision-making styles. “Satisficers” make decisions based on information they are satisfied with, based on an option that crosses an acceptable internal threshold. By contrast, “maximizers” aim to find the best possible outcome, often through an exhaustive search of options involving substantial time and effort.
Is Satisficing a Heuristic?
Satisficing is an approach to decision making, and therefore serves as a type of heuristic. Heuristics are often used to make immediate judgments, serving as mental shortcuts to aid in making decisions. Sometimes, heuristics can lead to cognitive biases and fallacies.
Other forms of heuristics include the availability heuristic, the representativeness heuristic, and the anchoring heuristic. Like the satisficing heuristic, each of these enables people to make decisions with lower effort, although presented in different situations.
