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Importance of Decision Making

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

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Importance of Decision Making

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  1. Importance of Decision Making • Measure • Regulation • Influence

  2. 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

  3. What do you see?

  4. What do you see now?

  5. Paris in the the Spring

  6. Types of Decisions Managers Make • Programmed • Non-Programmed

  7. 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

  8. 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

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

  10. Group Decision Making • GroupThink • Debating Group • Ideal Group Process

  11. GroupThink ConvergentThought Problem A Conclusion

  12. No Action Decision Process Discussion& Debate Problem

  13. Ideal Decision Process Problem Dialogue Discussion Action Divergent Thinking Convergent Thinking

  14. 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

  15. 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

  16. Confidence vs Uncertainty Degree of Confidence Amount of Uncertainty

  17. 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

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

  19. 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

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

  21. 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

  22. The Creative Process

  23. 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

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

  25. 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

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