Welcome to the HKUST MBA Program!

1. Welcome to the HKUST MBA Program! RESIDENTIAL COURSE: MGTO 521 MANAGERIAL PROBLEM SOLVING

2. MGTO 521: Managerial Problem Solving Steve DeKrey Stephen Nason & Katherine Xin Hong Kong University of Science and Technology sjdekrey@ust.hk mnsnason@ust.hk mnkxin@ust.hk

3. MGTO 521: Managerial Problem Solving Teaching Assistants Anindita Banerjee Ann Fok Cubie Lau Michelle To Hong Kong University of Science and Technology

4. Course Objectives • To understand the basic modes of decision making • To experience decision making in groups and examine the dynamics • To practice problem solving skills which includes spotting problems, framing them correctly, and implementing appropriate solutions • To receive feedback on your own style from the group

5. Today! Day 1 • Why this course??? • Let’s get acquainted • Desert survival Exercise • Decision making/Problem Solving • Teams: a preliminary look • Minicase: SIA & Tanglin Polymers • Learning with Cases (Mauffette-Leenders, Erskine, Leenders)

6. Why This Course??? Introductions & Expectations • Why managerial problem solving?? • Problem solving, decision making: the essence of management • Is there a difference between “decision making” and “problem solving”? • A key role of LEADERS: the art of PROBLEM FINDING

7. - From “Smart Thinking for Crazy Times” by Ian Mitroff • Where is the true competitive edge that will separate successful individuals, organizations, societies from the also-rans?

8. Focus on PROCESS,Not SOLUTIONS • Spot the right problems • Frame them correctly • Implement appropriate solutions

9. An Experiential Learning Exercise • Participate • Observe • Reflect, Learn, and have fun

10. Let’s Get Acquainted!!

11. The Process • Meet with your group members in the designated breakout areas • Introduce yourselves • Learn something about each member • Introduce an interesting fact/trait • What do you want to accomplish this week? • Please take 45 minutes for this process

12. The Presentation • Establish a team identity - a name, a symbol • Introduce team members in a memorable way • What are the team objectives and goals for this class? • Each team has 5 minutes!!!

13. What Is an Organization? • Definition: Social entities, goal directed, deliberately structured activity systems, linked to external environment

14. Organizations as Systems • Open systems • Organization subsystems • boundary spanning • production • maintenance • adaptive • management

15. Structural Dimensions of Organizations • Formalization • Specialization • Standardization • Hierarchy of authority • Complexity • Centralization • Professionalism • Personnel ratios

16. Levels of Analysis • Organization • Departments • Groups and teams • Individuals

17. The External Environment • Task environment • Industry sector • Market sector • Human resource sector • International sector • General environment • Government and political • Economic and financial • Technological • Socio-demographic

18. Low specialization More teamwork More participation Less hierarchy Less formalization More decentralization Horizontal communication High specialization Rigid defined areas More authority More hierarchy More formalized Centralized decision-making Vertical communication Organic versus Mechanistic

19. Decision Making Processes

20. What Is Decision Making? • The process by which members of an organization choose a specific course of action to respond to both problems and opportunities.

21. Types of Decisions • Programmed Decisions: • decisions made in response to recurring problems and opportunities • Non-programmed Decisions: • decisions made in response to novel problems and opportunities

22. Decision-Making Process • Rational Model of decision making • Boundedly Rational Model of Decision Making (March and Simon) • Intuition

23. Rational Model of Decision Making • Based on assumption that decision maker has all necessary information and will choose the best possible solution.

24. The Rational Model • Define the problem • Identify criteria • Weight the criteria • Generate alternatives • Rate alternatives on each criterion • Compute the optimal decision

25. How managers actually make decisions (March & Simon) People making decisions subject to • Incomplete information, • Psychological and sociological processes, • Limited cognitive abilities Which affect decision making such that decision makers • make boudedly rational decisions and • choose satisfactory, not optimal, solutions.

26. How managers actually make decisions Satisficing: Searching for and choosing an acceptable response or solution, not necessarily the best possible one. Bounded Rationality: An ability to reason that is constrained by the limitations of the human mind itself.

27. Intuitive Model Decisions result from an unconscious process based on intuition. • Intuition is often based on accumulated experiences which allow one to recognize patterns so not necessarily illogical Problems with the intuitive model • criteria not open to examination • often intuition influenced by perceptual biases.

28. When the World Changes . . . • Creativity: decision-making process that produces novel and useful ideas • Innovation: successful implementation of creative ideas

29. Desert Survival Exercise

30. Desert Survival: What Did We Learn? • Group decision making: Slower but better • Takes longer! MUCH longer • On average, more input, more information, thus better decisions • But always some who are WORSE off in groups • Why does group not hear these people? • How can groups improve?

31. Advantages of Group Decision Making • Wide range of knowledge and experience • Enhanced memory about facts • Acceptance is high by participants • Understanding by participants is high

32. Disadvantages of Group Decision Making • Social pressure may create conformity • Groups tend towards riskier decisions • Time consuming • Premature closure

33. Other Consequences of Group Decision Making • Diffusion of Responsibility • Group Polarization • Potential for Conflict

34. Type of problem or task Is acceptance essential? Is quality of decision important? Personalities and capabilities Climate (cooperative or competitive) Time available Is it a Group Decision?

35. The Nature of High Performing Teams

36. What Are the Properties of Effectively Functioning Teams? • Results are consistent • People in effective teams KNOW the answer • But this is tacit knowledge • We must make it explicit

37. Key Success Factors for Teams • A clear elevating goal • Results driven structure • Competent team members • Unified commitment • Collaborative climate • Standards of excellence • External support and recognition • Principled leadership

38. A Clear and Elevating Goal • What does this mean? • What is a goal? • Clarity: focused and non-political • Elevating: worth doing and personally challenging

39. A Results Driven Structure • What types of results • Problem resolution team • Creativity team • Tactical team • What kind of team are you? • Team structure • Roles and responsibilities • Effective communication • Methods for monitoring and feedback • Emphasis on fact-based judgments

40. Competent Team Members • Right people for the task • Technical competencies • Personal competencies • Best matches • Problem solving teams: intelligent, savvy, people sensitive, high integrity • Creative teams: cerebral, independent, tenacious • Tactical teams: loyal, committed, action oriented

41. Unified Commitment • What does this mean? • Spirit • Loss of self • Unity • How to get it? • Involvement • Balancing • Expectations • Group task and maintenance behavior only

42. Collaborative Climate • Meaning? • Teamwork, whole > sum of parts, working well together • Four elements • Honesty, openness, consistency, respect • Total trust through involvement and autonomy

43. Standards of Excellence • Standards matter • Standards are hard work • Standards are easy to ignore • No resting on past performance • Standards in this class???

44. External Support and Recognition • What is this? • Why is it important? • Why is tangible support needed?

45. Principled Leadership • Consistency • Courage • Standards • Communication skills • Promotes the other 7 factors • Leaders create leaders

46. Learning with Cases

47. Singapore Airlines & Tanglin Polymers • Discuss in your groups • Prepare a 5-minute presentation • One key: finding the right problem • You choose. possible topics follow

48. Singapore Airlines: Continuing Service Improvement? • You may wish to consider the following questions: • How would you answer Paul Denver’s letter? • What should SIA say or do about the staff at Denpasar? • What should SIA say or do about the staff at Changi? • What suggestion would you give SIA in terms of continuing customer service improvement?

49. Tanglin Polymers Case • You may wish to consider the following questions: • Is there a problem? • If so, what is the problem? • Who’s problem is it? • How would you solve the problem?

50. What Is a Case? • A description of an actual situation, commonly involving a decision, a challenge, an opportunity, a problem or an issue faced by a person (or persons) in an organization. • Allows you to step figuratively into the position of a particular decision maker. • Field-based with the visit of an organization and collection of data. • The product of a carefully thought-out process.