desicion making

DECISION MAKING

ROADMAP

Types of decisions

Models of decision making

The decision making process

Creativity

Shortcuts and traps

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2

CONNECTING THE DOTS

“Making warning systems more sensitive reduces the risk of surprise, but increases the number of false alarms, which in turn reduces sensitivity”

“The Chief of Staff has to make decisions, and his decisions must be clear… To be sure, the clearer and sharper the estimate, the clearer and sharper the mistake..”

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LIS580- SPRING 2006 3

UNDERSTANDING DECISION MAKINGPuzzles, Problems, and Wicked ProblemsA discrepancy between a desirable and an actual situation.

Well structured, ill-structured, and complex problems.

DecisionA choice made between available alternatives.Decision MakingThe process of developing and analyzing alternatives and choosing from among them.

JudgmentThe cognitive, or “thinking,” aspects of the decision-making process.

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LIS580- SPRING 2006 4G.Dessler, 2003

WICKED PROBLEMSProposed by H.J. Rittel and M. Webber of UC Berkeley in 1973.Wicked problems do not have an exhaustive set of potential solutions. Every wicked problem can be considered to be a symptom of another

problem. Discrepancies in representing a wicked problem can be explained in

numerous ways--the choice of explanation in turn determines the nature of the problem's resolution.

Every wicked problem is essentially unique--lessons-learned are hard to transfer across to other problems.

Wicked problems are often "solved" through group efforts. Wicked problems require inventive/creative solutions. Every implemented solution to a wicked problem has consequences, and

may cause additional problems. Wicked problems have no stopping rule(s). Solutions to wicked problems are not true-or-false, but instead better,

worse, or good enough. There is no immediate and no ultimate test of a solution to a wicked

problem. The planner or designer (solving the problem) has no inherent right to

solve the problem, and no permission to make mistakes.

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LIS580- SPRING 2006 5http://en.wikipedia.org/wiki/Wicked_problems

TYPES OF DECISIONS

Programmed Decision A decision that is repetitive and routine and can be made

by using a definite, systematic procedure.

Nonprogrammed Decision A decision that is unique and novel.

The Principle of Exception “Only bring exceptions to the way things should be to the

manager’s attention. Handle routine matters yourself.”

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Programmed Decisions

Nonprogrammed Decisions

Top

Level in Organization

Bottom

Ill-structured

Type of Problem

Well-structured

PROCEDURE AND FORM TO USE FOR DEVELOPING A WORKPLACE RULE

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LIS580- SPRING 2006 7Source: Copyright Gary Dessler, Ph.D.

FIGURE 3–1

DECISION-MAKING MODELS

The Classical Approach Have complete or “perfect” information about the

situation. Distinguish perfectly between the problem and its

symptoms. Identify all criteria and accurately weigh all the criteria

according to preferences. Know all alternatives and can assess each one against

each criterion. Accurately calculate and choose the alternative with

the highest perceived value. Make an “optimal” choice without being confused by

“irrational” thought processes.

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The problem is clear and

unambiguous

A single, well-defined goal

is to be achieved

All alternatives and

consequences are known

Preferences are clear

Preferences are constant and stable

No time or cost

constraints exist

Final choice will maximize

economic payoff

DECISION-MAKING MODELS (CONT’D)The Administrative Approach Bounded Rationality (Herbert Simon)

The boundaries on rational decision making imposed by one’s values, abilities, and limited capacity for processing information.

Satisfice To stop the decision-making process when satisfactory alternatives

are found, rather than to review solutions until an optimal alternative is discovered.

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CHECKLIST 3.1THE DECISION-MAKING PROCESS Define the problem. Clarify your objectives. Identify alternatives. Analyze the

consequences. Make a choice.

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STEP 1. DEFINE THE PROBLEM

1. Start by writing down your initial assessment of the problem.

2. Dissect the problem. What triggered this problem (as I’ve assessed it)? Why am I even thinking about solving this problem? What is the connection between the trigger and the

problem?

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STEP 2. CLARIFY YOUR OBJECTIVES

1. Write down all the concerns you hope to address through your decision.

2. Convert your concerns into specific, concrete objectives.

3. Separate ends from means to establish your fundamental objectives.

4. Clarify what you mean by each objective.

5. Test your objectives to see if they capture your interests.

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STEP 3. IDENTIFY ALTERNATIVES

1. Generate as many alternatives as you can yourself.

2. Expand your search, by checking with other people, including experts.

3. Look at each of your objectives and ask, “how?”

4. Know when to stop.

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STEP 4. ANALYZE THE CONSEQUENCES

1. Mentally put yourself into the future. Process Analysis

Solving problems by thinking through the process involved from beginning to end, imagining, at each step, what actually would happen.

2. Eliminate any clearly inferior alternatives.

3. Organize your remaining alternatives into a table (matrix) that provides a concise, bird's-eye view of the consequences of pursuing each alternative.

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CONSEQUENCE MATRIX

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STEP 5. MAKE A CHOICE

Analyses are useless unless the right choice is made. Under perfect conditions, simply review the consequences of each

alternative, and choose the alternative that maximizes benefits. In practice, making a decision—even a relatively simple one like

choosing a computer—usually can’t be done so accurately or rationally.

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HOW TO MAKE BETTER DECISIONS1. Increase Your Knowledge

Ask questions. Get experience. Use consultants. Do your research. Force yourself to recognize the facts when you

see them (maintain your objectivity).

2. Use Your Intuition A cognitive process whereby a person

instinctively makes a decision based on his or her accumulated knowledge and experience.

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ARE YOU MORE RATIONAL OR MORE INTUITIVE?

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LIS580- SPRING 2006 18 FIGURE 3–2Source: Adapted and reproduced by permission of the Publisher, Psychological Assessment Resources. Inc., Odessa FL 33556,

from the Personal Style Inventory by William Taggart, Ph.D., and Barbara Hausladen. Copyright 1991, 1993 by PAR, Inc. G.Dessler, 2003

HOW TO MAKE BETTER DECISIONS (CONT’D)3. Weigh the Pros and Cons

Quantify realities by sizing up your options, and taking into consideration the relative importance of each of your objectives.

4. Don’t Overstress the Finality of Your Decision Remember that few decisions are forever. Knowing when to quit is sometimes the smartest

thing a manager can do.

5. Make Sure the Timing Is Right

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DECISION MATRIXUse weights to provide adjustments for importance of criteria

Often subjective, but helps to prioritize

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LIS580- SPRING 2006 20 FIGURE 3–3G.Dessler, 2003

CREATIVITY AND DECISION MAKINGCreativity The process of developing

original, novel responses to a problem.

Brainstorming A creativity-stimulating

technique in which prior judgments and criticisms are specifically forbidden from being expressed in order to encourage the free flow of ideas which are encouraged.

Nominal group technique A decision-making technique

in which group members are physically present but operate independently

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Creativity

Task motivation

Creativity skillsExpertise

NOMINAL GROUP TECHNIQUE

Each participant contributes individual ideas

Ideas are then ranked individually

Totals are summed for final rank

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LIS580- SPRING 2006 22http://www.ryerson.ca/~mjoppe/ResearchProcess/841TheNominalGroupTechnique.htm

CHECKLIST 3.4HOW TO BE MORE CREATIVE

Create a culture of creativity. Encourage brainstorming. Suspend judgment. Get more points of view. Provide physical support for

creativity. Encourage anonymous input.

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DECISION-MAKING SHORTCUTS AND TRAPSUsing a HeuristicApplying a rule of thumb or an approximation as a shortcut to decision making.

AnchoringUnconsciously giving disproportionate weight to the first information available.

Adopting a Psychological SetThe tendency to rely on a rigid strategy or approach when solving a problem.

Perception (Personal Bias)The unique way each person defines stimuli, depending on the influence of past experiences and the person’s present needs and personality.

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USING CREATIVITY TO FIND A SOLUTION

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LIS580- SPRING 2006 25Source: Applied Human Relations, 4th ed., by Benton/Halloran cW 1991. Reprinted by permission of Prentice-Hall, Upper Saddle River, NJ.

FIGURE 3–6G.Dessler, 2003

NEXT TIME

We’ll talk about planning basicsRead Chapter 4 and assigned articlesFor discussion article, think about these

questions:Do you think EMP used a well-defined planning process prior to opening?

Since the opening? If any planning has been done, who do you think has been involved in it?

Does planning matter in this situation?What steps might EMP take to provide more success in the future?

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LIS580- SPRING 2006 26

desicion making

Documents

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2006lis580 spring

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decision makinglis580

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complex problems

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