Decision situations are usually classified as decisions under certainty or uncertainty (risk) and considerable normative literature is available for guiding such decisions. Decision making under ambiguity, where ambiguity is operationalized as a “second order probability” or as a range of outcomes whose support may be unclear, is significantly different from risk and is receiving increasing attention in research. Most IS decisions, where little information is available about costs and benefits of alternatives are best characterized as decisions under ambiguity. In this paper, we focus on the decision strategies/heuristics adopted by decision makers when a) cost information, and, b) benefit information of IT investments are ambiguous. In an ambiguous situation, decision makers are known to either prefer unambiguous alternatives over ambiguous alternatives (ambiguity avoidance) or discount ambiguity completely (ambiguity discounting) and treat outcomes as certain, based on context factors. We generate several hypotheses for the cases of decision making in dyads as well as a general business settings relevant to IS decisions.
Nyshadham, Easwar A., "IS Decision Making Under Ambiguity" (2006). SAIS 2006 Proceedings. 19.