Relationship between Decision Styles and Decision Types for Innovative Opportunities: Empirical Study on Chinese Internet of Things Industry and the Cognitive Decision Support Approach

Abstract

Internet of things (IoT) has become a strategic industry of China. It is still at the initial stage, which means there are many problems and challenges, such as lack of original innovation, etc. In the dynamic business environment, innovative opportunities play important roles in the rapid growth of a company. How to grasp the innovative opportunities provided by IoT becomes a big challenge for Chinese companies. The applications of IoT in China are still very limited and some listing IoT companies don’t behave very well in market. This paper tries to find the reason from the aspect of decision making of those IoT and its related companies’ senior executives. Their decision behaviors vary according to decision makers’ decision styles. The empirical study on Chinese IoT related companies shows that decision styles have close relationship with decision types when decision makers are facing innovative opportunities. Three decision styles and three decision types were analyzed based on our investigation. 45.8% of the wise and heroic leaders inclined to make radical and risky decisions. 52.2% of the CEOs make decisions in moderate way while 57.6% of the CEOs who prefer to conform to others inclined to make conservative decisions. Chinese traditional culture and the limitation of incentive mechanism may account for the high ratio of conservative decisions and the lack of original innovations in IoT industry. Decision makers can benefit from learning appropriate cases. According to decision makers’ decision styles and the characteristics of a decision problem, a decision support approach is proposed to improve their cognition and decision behaviors.