Models Based on the Theory of Games

Abstract

The game is a competitive process that occurs between several players by certain rules and is used very often in the management of organisational entities. The representation of any game is always done by a matrix that is much used in the decision-making process, regardless of the conditions in which managers take the decision. Organizational entities activity is performed in a dynamic environment which requires the managers to make timely decisions in short intervals. Managers do not always know the conditions and factors that influence decisions which they are to take. The managers are not aware of the consequences of decisions to take regarding the future activity organizational entities. Therefore the purpose of any goal of any manager is to optimise the decisions. Depending on the conditions in which decisions will be made and their consequences in game theory have developed a series of models that contain mathematical format, considering that decisions are made and the consequences of those decisions. Between the best known such methods are: the Wald method, Laplace method, method of multiple criteria decision tree, Electre method, graphical representation method, etc. Strategic management uses very much for making decisions based on multi-criteria optimization models.