This paper develops a theory-practice view of administrative and organizational decision making. Its goals are to improve administrative decision-making processes, facilitate organizational change through faculty involvement, and increase the potential for success in education reform efforts. The first sections discuss the nature of theory and examine the relationship between theory and practice. The three major properties of a theory include generalization, analysis, and prediction. Limitations of theory and the requirements of validity and reliability are discussed. Rather than serving as objective maps of reality, it is concluded that theories provide a "guide to action." In theory and practice, organizational decision making as a social enterprise is viewed as a four-phase process: (1) recognizing the problem and developing a plan; (2) generating interactions among people involved; (3) negotiating; and (4) producing consequences. Organizational stability, however, is not possible or desirable, because people and situations change. Finally, several examples of ways to use the new paradigm are presented, including organizational decision making by Japanese automakers, policy analysis and action for governments, curriculum change in a school, and school restructuring. Recommendations for further study are offered. One figure is included. (LMI)