Rangan, V. Kasturi
March 1987
Marketing Science;Spring87, Vol. 6 Issue 2, p179
Academic Journal
This article focuses on the channel design decision. The use of subjective data, or managerial judgment, in estimation has been a topic of debate for over 15 years. Ever since it was proposed in 1970, there have been well-founded arguments against the "decision calculus" approach. The point is that the manager has selectively adjusted the weight of certain factors based on the peculiarities of the site. While traffic speed downscaled access variables in one case, mall strength improved facility variables in the other. Managerial judgment often makes up for the effects of unspecified or unique variables which objective data cannot capture. Yet the author doesn't know how much of the correction is "bias" and how much "superior judgment." He concedes that judgmental or managerial data could be suspect, but the solution is not to fall back on objective measures. If managers are hired to manage the future, they may be expected to be knowledgeable about it too. By ignoring their judgments, the author throws away easily and cheaply available data.


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