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Decision Analysis:

Peter Drucker provides a very nice framework for business decision analysis. It was

originally written in 1966. He defines what he means by effective and executive. He says that

efficiency is doing things right, and effectiveness is doing the right things.

An executive is a knowledge worker who is hired to make decisions and take actions that

have an impact on the performance and outcomes of an organization. He outlines the important

characteristics and traits of an effective executive. Although he doesn't mention decision making

until later, competency in any of the traits requires effective business decision analysis.

1. Know where your time goes

Time is the scarcest resource, so it's important not to waste it. He points out that manypeople do things they are not necessary, things that could be better done by others, and things

that waste other people's time. Good recording and managing of your time will allow you to do

business decision analysis of a completely different calibre.

2. Focus on results

Drucker points out that putting our attention on outward contributions and results allows

for more effectiveness then attention downwards on efforts. When people ask themselves 'What

can I contribute?' it allows for communications that makes teamwork possible. It also allows for

individual self-development which in turn stimulates others to develop themselves.

3. Make strength productive

An effective executive's business decision analysis is organized around utilizing people's

strengths, rather than the absence of weaknesses. He suggests you feed opportunities and starve

problems...!

4. Set priorities

Know what to do and I know what not to do. Do one thing at a time, and do it well.

5. Be yourself

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Not somebody else - that's very familiar too!

6. Decision making

An effective executives business decision analysis includes finding those decisions that

are significant and strategic, rather than just solving problems. The steps in his decision making

process includes:

y Is this a generic situation or unique? If it's generic the decision will establish a rule orprinciple. If it's unique, it is dealt with on its own merits.

y What are the objectives the decision has to reach? What are the boundary conditions?

y What solution satisfies these conditions, because there will be compromise of some sort.He points out that the things one worries about almost never happen and objections and

difficulties nobody had considered suddenly turn out to be almost insurmountable

obstacles.

y Convert the decision into actiony Check if the actions are producing the expected result

Drucker believes that this kind of business decision analysis can be learnt. Acquiring the

knowledge, skills and habits he outlines will allow for an increase in effectiveness.