Decision Making

Module 3
LIS 580: Spring, 2006
Instructor- Michael Crandall

Roadmap

Types of decisions
Models of decision making
The decision making process
Creativity
Shortcuts and traps

April 4, 2006

LIS580- Spring 2006

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..
April 4, 2006

LIS580- Spring 2006

Understanding Decision Making

Puzzles, Problems, and Wicked Problems
A discrepancy between a desirable and an actual
situation.
Well structured, ill-structured, and complex
problems.

Decision
A choice made between available alternatives.

Decision Making
The process of developing and analyzing
alternatives and choosing from among them.

Judgment
The cognitive, or thinking, aspects of the decisionmaking process.
G.Dessler, 2003

April 4, 2006

LIS580- Spring 2006

Wicked Problems

Proposed 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.
http://en.wikipedia.org/wiki/Wicked_problems

April 4, 2006

LIS580- Spring 2006

Types of Decisions
Ill-structured
Type of
Problem
Well-structured

Nonprogrammed
Decisions
Programmed
Decisions

Top
Level in
Organization
Bottom

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
managers attention. Handle routine matters yourself.
G.Dessler, 2003

April 4, 2006

LIS580- Spring 2006

Procedure and Form to Use for

Developing a Workplace Rule

FIGURE 31
Source: Copyright Gary Dessler, Ph.D.

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LIS580- Spring 2006

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.
The problem
is clear and
unambiguous

A single, welldefined 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
G.Dessler, 2003

April 4, 2006

LIS580- Spring 2006

Decision-Making Models (contd)

The Administrative Approach
Bounded Rationality (Herbert Simon)
The boundaries on rational decision making
imposed by ones 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.
G.Dessler, 2003

April 4, 2006

LIS580- Spring 2006

Checklist 3.1
The Decision-Making Process

Define the problem.

Clarify your objectives.
Identify alternatives.
Analyze the consequences.
Make a choice.
G.Dessler, 2003

April 4, 2006

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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 Ive
assessed it)?
Why am I even thinking about solving this
problem?
What is the connection between the
trigger and the problem?
G.Dessler, 2003

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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.
G.Dessler, 2003

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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.
G.Dessler, 2003

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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.
G.Dessler, 2003

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Consequence Matrix

G.Dessler, 2003

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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 decisioneven a
relatively simple one like choosing a
computerusually cant be done so
accurately or rationally.
G.Dessler, 2003

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How To Make Better Decisions

1. 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.
G.Dessler, 2003

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Are You More Rational or More

Intuitive?

Source: 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.

April 4, 2006

LIS580- Spring 2006

FIGURE 32
G.Dessler, 2003

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How To Make Better Decisions

(contd)
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. Dont 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

G.Dessler, 2003

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Decision Matrix
Use weights to provide adjustments for
importance of criteria
Often subjective, but helps to prioritize

FIGURE 33
G.Dessler, 2003

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Creativity and Decision Making

Creativity
The process of developing
original, novel responses to
a problem.

Brainstorming

Creativity

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.

Creativity
skills

Expertise

Task motivation

Nominal group technique

A decision-making technique
in which group members are
physically present but
operate independently
G.Dessler, 2003

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Nominal Group Technique

Each participant contributes individual
ideas
Ideas are then ranked individually
Totals are summed for final rank

http://www.ryerson.ca/~mjoppe/ResearchProcess/841TheNominalGroupTechnique.htm

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Checklist 3.4
How 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.

G.Dessler, 2003

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Decision-making Shortcuts and

Traps
Using a Heuristic
Applying a rule of thumb or an approximation as a
shortcut to decision making.

Anchoring
Unconsciously giving disproportionate weight to the
first information available.

Adopting a Psychological Set

The 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 persons present needs and personality.
G.Dessler, 2003

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Using Creativity to Find a Solution

Source: Applied Human Relations, 4th ed., by Benton/Halloran cW 1991.

Reprinted by permission of Prentice-Hall, Upper Saddle River, NJ.

April 4, 2006

LIS580- Spring 2006

FIGURE 36
G.Dessler, 2003

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Next Time
Well talk about planning basics
Read Chapter 4 and assigned articles
For 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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