Mgt. 458 Decision Making and Creativity Rex Mitchell Fall 2011

1. Mgt. 458 Decision Making and Creativity Rex Mitchell Fall 2011

2. Some Questions • What is decision making? • What is a “good” decision? • Distinction between decision making and problem solving?

3. Decision Making and Problem Solving • Decision making: the process of arriving at an outcome that meets objectives (and does not cause more problems) • Problem solving involves decisions, although not all decisions involve problems

4. Creativity is important in decision making and problem solving • Critical/strategic thinking is also important • There is considerable transferability of decision making skills • All of us can improve our creative decision making skills

9. What is a “problem?”

10. A problem is: • A discrepancy between an existing and a desired state of affairs • A puzzling situation that needs to be understood or explained

11. Course Overview • Decision making (broadly) • Critical and strategic thinking • Creativity

12. Different Types of DM/PS Models • Programmed -- non-programmed • e.g., policies & procedures vs. unique one-time situations • Rational -- intuitive -- combinations • e.g., “Data” -- Deanna Troy -- Picard • Combinations have many advantages

13. Basic Decision Making Model • Recognize a problem or dm situation • Frame the problem/decision (objectives, constraints, factors, priorities) • Generate alternatives • Evaluate & choose • Implement & evaluate results (iterate) • Stabilize & learn from

14. Engage with the readings • What seems important here, what do I like, agree with, find useful? Why? • Highlight, make margin notes • How might I apply one or more concepts in my life – now and in the future? • Are there things I disagree with and/or would modify or expand on? Why? How? • Is important to create your own reading notes or concept map

15. Basic Decision MakingProcess

16. Basic Decision Making Model • Recognize a problem or dm situation • Frame the problem/decision (objectives, constraints, factors, priorities) • Generate alternatives • Evaluate & choose • Implement & evaluate results (iterate) • Stabilize & learn from

17. A Decision Frame • Creating a context for the decision • Recognize the real problem, not just symptoms • Objectives • Constraints & other factors • Priorities

18. Framing • Provides context for discussion, decision, or negotiations • Selecting & emphasizing certain aspects • Excluding or minimizing others • Clarifying objectives and constraints • Frames differ among individuals • Can be used to distort and mislead

19. Framing Examples • The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama's 'death panel' so his bureaucrats can decide whether they are worthy of health care

20. Over the time that President Obama has been in office, we have lost 2.5 million free enterprise system jobs, and, yet, 500,000 federal government jobs have been added.

21. Social Security and its attendant Medicare are broken and bankrupt systems because we, as voting citizens, have allowed congress to transform these systems from insurance programs to entitlement programs

22. Defunding ObamaCare is essential to the economic survival of the United States. The federal healthcare takeover offers no solutions to the cost issues or quality of care issues, related to healthcare. One needs look no further than Massachusetts, to know that nationalized healthcare will not work. Rationing healthcare will put huge segments of America’s population at risk.

23. Different Frames for One Situation • Things are so uncertain with our business, we'd better not "rock the boat!" • Our business is in such a nose dive, we must do something different right away or we will lose it all! • Our business has major troubles. We need some help in diagnosing the problems and developing solutions.

24. Critical and StrategicThinking

25. Critical Thinking Q’s- Browne & Keeley • What are the issues and the conclusions? • What are the reasons supporting the conclusions? • Which words or phrases are ambiguous? • What are the value conflicts and assumptions about value priorities? • What are the descriptive assumptions? • How good is the evidence? • What significant information is omitted? • Are the statistics deceptive or misleading? • Are there any fallacies in the reasoning? • Are there rival causes, i.e., other explanations or interpretations of the evidence or these findings? • What other reasonable conclusions are possible?

26. Note, especially… 1. What are the issues and the conclusions? 2. What are the reasons supporting the conclusions? 5. What are the descriptive assumptions? 11. What other reasonable conclusions are possible?

27. Some Un-critical Thinking • Heavier-than-air flying machines are impossible. • Lord Kelvin-British mathematician, physicist, and president of the British Royal Society, c. 1895. • A severe depression like that of 1920-21 is outside the range of probability. • Harvard Economic Society-Weekly Letter November 16, 1929

28. More Un-critical Thinking • Gone with the Wind is going to be the biggest flop in Hollywood history. • Gary Cooper, 1937, after turning down the role of Rhett Butler • They couldn't hit an elephant at this dist_____ • General John B. Sedgwick-Union Army Civil War officer's last words, uttered during the Battle of Spotsylvania, 1864

29. Some Common Fallacies • Slippery Slope: assuming that a proposed step will set off an uncontrollable chain of undesirable events • Searching for Perfect Solution: unwilling to solve part of a problem • Equivocation: using a key word with two or more meanings in an argument • Appeal to Popularity : falsely assumes that something favored by a large group is desirable • Appeal to Questionable Authority: citing an authority who lacks special expertise on the issue at hand • Appeals to Emotions: using emotionally charged language to distract from relevant reasons and evidence • Straw Person: Distorting one’s opponent’s point of view so that is it easy to attack • Attacks: Attacks a person or a person’s background, instead of the person’s ideas • Either-Or: assuming only two alternatives • Wishful Thinking: assuming that, because we wish X were true or false, then X is indeed true or false • Explaining by Naming: assuming that a name for some event or behavior adequately explained the event • Glittering Generality: Use of vague emotionally charged words • Red Herring: An irrelevant topic is presented to divert attention from the original issue • Begging the Question: an argument in which the conclusion is assumed in the reasoning. • Hasty Generalization: drawing a conclusion about a large group based on experiences with only a few members • Faulty Analogy: using an analogy in which there are important relevant dissimilarities • Causal Oversimplification: explaining an event by relying on causal factors that are insufficient… • Confusion of Cause and Effect: confusing the cause with the effect of an event • Neglect of a Common Cause: failure to recognize that two events may be related because of a 3rd factor • Post Hoc: assuming that a particular event, B, is caused by another event, A, simply because B follows A in time.

30. Note, especially… 1. Slippery Slope: assuming that a proposed step will set off an uncontrollable chain of undesirable events 3. Equivocation: using a key word with two or more meanings in an argument 6. Appeals to Emotions: using emotionally charged language to distract from relevant reasons and evidence 12. Glittering Generality: Use of vague emotionally charged words 20. Post Hoc: assuming that a particular event, B, is caused by another event, A, simply because B follows A in time.

31. The Socialist Democrat Establishment of America wants to shut Pro-American Voices Up! (on a tee-shirt, with this capitalization)

32. The history of forcing fluoride on humans through the fluoridation of drinking water is wrought with lies, greed and deception. Governments that add fluoride to drinking water supplies insist that it is safe, beneficial and necessary, however, scientific evidence shows that fluoride is not safe to ingest… The lies of the benefits of water fluoridation will continue to be fed to the public, not to encourage health benefits to a large number of people, but to profit the military-industrial complex. (2009)

33. Some questions & fallacies • What are the issues and the conclusions? • What are the reasons supporting the conclusions? • How good is the evidence? • Equivocation: using a key word with two or more meanings in an argument • Appeals to Emotions: using emotionally charged language to distract from relevant reasons and evidence • Causal Oversimplification: explaining an event by relying on causal factors that are insufficient…

34. Obama's got a health care logo that's right out of Adolf Hitler's playbook ... Adolf Hitler, like Barack Obama, also ruled by dictate.'' —Rush Limbaugh, Aug. 6, 2009 • ''If ObamaCare passes, that free insurance card that's in people's pockets is gonna be as worthless as a Confederate dollar after the war between the states -- the Great War of Yankee Aggression.''

35. The number one economic threat to our nation and our well-being is the price of a gallon of gas. We as individuals and our nation are at risk. We have watched the price of gas sharply increase and to this day our Congress has done nothing or even indicated they have a plan. The quickest and most helpful thing Congress can do to reduce the price of gas right now is to lift the moratorium on drilling for oil in the U.S. and offshore. Drilling offshore can be done safely now! Other nations are doing it now! (2009)

36. Strategic Thinking • Identify & focus on important issues • Select key, relevant information • Recognize systemic properties • Understand through: • Distinguishing causes from effects • Clarifying (tacit) underlying assumptions • Considering issue in a larger context • Maintaining a long-term view

37. Strategic Thinking (cont.) • Appreciate implications & consequences • Generate alternatives & evaluate objectively • Integrate logical/rational & creative/generative thinking • Remain flexible • Act in the face of emotional discomfort

38. Another View of Strategic Thinking • Thinking more deeply to distinguish underlying causes and issues from more obvious symptoms • Thinking more broadly to recognize systemic linkages, interactions, and patterns • Thinking long-term as well as short-term about implications and consequences

39. Strategic Thinking Case • Apply strategic thinking to the case, making notes for yourself • Discuss in groups • Report out with total class discussion

40. Critical Thinking Q’s- Browne & Keeley • What are the issues and the conclusions? • What are the reasons supporting the conclusions? • Which words or phrases are ambiguous? • What are the value conflicts and assumptions about value priorities? • What are the descriptive assumptions? • How good is the evidence? • What significant information is omitted? • Are the statistics deceptive or misleading? • Are there any fallacies in the reasoning? • Are there rival causes, i.e., other explanations or interpretations of the evidence or these findings? • What other reasonable conclusions are possible?

41. Recent Examples

42. Basic Decision Making Model (again) • Recognize a problem or dm situation • Frame the problem/decision (objectives, constraints, factors, priorities) • Generate alternatives • Evaluate & choose • Implement & evaluate results (iterate) • Stabilize & learn from

43. A Decision Frame (again) • Creating a context for the decision • Recognize the real problem, not just symptoms • Objectives • Constraints & other factors • Priorities

44. Framing Exercise • Off-shore oil drilling is a hot topic • A 1962 federal law largely prohibits offshore drilling, except in Alabama, Louisiana, Mississippi, Texas and parts of Alaska and California • 1990, Bush Sr. issues executive order banning other drilling. Clinton reissued it. • July 2008, Bush Jr. issues executive order lifting the ban • April 20, 2010, BP’s rig explodes, starting spill • April 20, Obama orders 6-month moratorium on drilling • Many moves & proposals +/- since then

45. Framing Exercise • In groups, develop frame: • Objectives • Main factors, priorities, & constraints considered • Selective arguments put forth • One of: • (1) Oil company CEOs • (2) Obama & administration • (3) Business-friendly republicans • (4) Environmental advocates

46. Since objectives are an important part of decision making, let’s consider them further

47. Objectives (aka Goals) • “If you don't know where you're going, you might wind up somewhere else.” (Yogi Berra) • Define goals in terms of results and outcomes, not actions • Frame as positive results to be achieved rather than problems to be avoided • Distinguish among interests, objectives (= goals), strategies, positions, & actions

48. Several Types of Objectives • Content • Relational • Identity (self-esteem) • Process ….CRIP

49. Goals and Interests • Interest: underlying need, desire, or concern • Goal (objective): desired outcome or result • Strategy: method for achieving a goal • Position: stated action, result, or proposal • Action: specific steps taken

50. Is This an Interest, Objective, Strategy, Position, or Action? • Make $60,000 this year • I need more money with the arrival of a second child • I think I deserve a 7% salary increase • I will first try to negotiate an increase in my salary, then, if necessary, I will search for a second part-time job