Importance of Decision Making Measure Regulation Influence

What Makes Making a (Good) Decision so Difficult? Multiple Criteria –conflicting values Intangibles –Unknowables, Unmeasurables Uncertainty Consequences –Long/Short ; Near/Far ; Intended/Unintended Our Knowledge is Always Incomplete Our Knowledge is influenced by Perception

What do you see?

What do you see now?

Paris in the the Spring

Types of Decisions Managers Make Programmed Non-Programmed

A company was losing money. Key managers were asked to investigate the decline in sales Marketing Manager framed the problem… –a lack of advertising & promotional support Sales Manager framed the problem… –a lack of promotion and distributor support programs Manufacturing framed the problem… –inaccurate forecasting by marketing and sales, causing poor production planning Finance framed the problem… –budget overruns by all departments and unreliable forecasts by marketing

Some Decision Traps (Mis-) Framing –limiting our questions Anchoring –disproportionate wt to 1st info, biasing subsequent thinking Status Quo –decisions tend to involve the least change Confirming Evidence –use of (only) data that confirms pt of view Escalation of Commitment –“throwing good $ after bad”, “avoid being wrong in the past” Overconfidence –never doubting what one believes –fear of admitting that you don’t know

Decisions are Made: Individually Individually But With the Consultation of Others Group

Group Decision Making GroupThink Debating Group Ideal Group Process

GroupThink Convergent Thought Problem A Conclusion

Discussion & Debate Problem No Action Decision Process

Ideal Decision Process ProblemDialogueDiscussionAction Divergent Thinking Convergent Thinking

Ways of Dealing with Problems Avoid making a decision –simply ignore an issue exists Reactive in making a decision –event level mgmt, problems of the day, circumstance directed Proactive in making a decision –anticipate, prevention, problems=opportunity

Ways to Find a Solution Logical/Rational Thinking –reductionistic, one-at-a-time, mechanical, memory based Intuitive Thinking –connecting many, relationships, flexible, less reliance on mechanical thinking, creative

Confidence vs Uncertainty Degree of Confidence Amount of Uncertainty

Types of Problems Managers Face Structured –familiar, constant circumstances Unstructured –ambiguity, not logically apparent Crises –isolate and identify real issue, time is short, full information is lacking

Common Mistakes in Problem Solving Deciding on the Focus Confusing Symptoms for the Problem Selecting the Wrong Problem

A Problem Solving Process Identify & Define the Problem Analyze the Potential Causes & Gather Information Generate Possible Solutions Evaluate & Select a Course of Action Implement the Solution Monitor and Follow Up & If not solved, return to step 2 above

Given the following symptoms, what is the problem and what is your plan for its resolution? Personal Financial Worries Balancing Work & Family Little or no recognition of achievement Poor Internal Communication Poor Leadership Burdened w/ work hrs & load Insuff. Resources Lack of Mgt Support Co. Politics

What is Creativity? An Attitude –willingness to embrace doubt, uncertainty, curious –willingness to suspend judgment An Ability –to generate new ideas, to be playful with ideas –to seek challenge –constructive discontent A Process –it takes time, it is not the result of a single stroke of brilliance

The Creative Process

Creativity Preparation –Knowledge –Non-mechanical thinking Incubation & Insight –Unconscious thinking –Intuition –Creative Leap Evaluation & Elaboration: Development –Seeking the logic of it all –Reality altering check

Critical vs Creative Thinking Analytic Linear Objective Rational Logical Convergent Left Brain Generative Non-Linear Subjective Non-Rational Non-Logical Divergent Right Brain

Obstacles to Creativity Looking for the Right Answers Trying to be Logical Strictly following The Rules & Tradition Avoiding Ambiguity Having an Expert Mind vs Beginners Mind Fearing Failure Forgetting How To Play Believing “You’re not Creative” Failure to Express (& Be Playful with) Ideas Failure to be Open, Flexible & Tolerant to Different Ideas –prejudice, stereotype thinker, rigid