Q1.
The colleague is using the rational choice paradigm.

Q2 & Q3.
Although this approach may churn out the most perfect travel agency, for the company, that is worth the money for the service, this is not a good approach. Why? Firstly, it would be a waste of the company's time and resources (or perhaps it's only yourself) to use it on the exact calculation of all the relevant factors provided by all the travel agencies in Singapore. I believe there are over 100 travel agencies in Singapore. Having to really look through all the 100 travel agencies (which this rational choice paradigm approach encourage to pick out the best) is an impossible task. The employees might not even get to travel at all because how long will it take to finish ranking them?

Secondly, choosing a travel agency to do all the traveling plans is not that straight-forward where you can weigh out all the factors for choosing. How do you know which factor has the higher weight? The answer is, you can't. This is because a person's idea of a good travel (be it business travel or vacation travel) may be very different from another. It's not possible to make a compromise between all the 2000 employees. Thus, it is important to just be able to choose the alternative that is good enough.

There are many more explanations on why the rational choice paradigm will not work. But I would not carry on as there are indeed a lot more. Therefore, I suggest to use the organisational behaviour approach for making this decision. This approach will be indeed more practical.

Boon Keng :)