Wednesday, December 28, 2016

Setting Principles to Evaluate Decision-Making Scenario

If the decision-making scenario is well designed and well-executed, you have the highest probability of getting the best outcome in the state of knowledge accessible at the time of decision-making.

Decision maturity is to ensure the right decisions have been made by the right people at the right time with the right mix of information and intuition. It is important to differentiate decision maturity from decision outcomes. Decision maturity can be achieved via both improving decision efficiency and effectiveness. Decision efficiency is a measure of how well resources are used, information is retrieved, and processes are adjusted to make decisions; it is value-free. Decision effectiveness is achieved via the quality of decision-makers and decision efficiency weighted by the values of the decision outcome achieved; it is value-full. It is important for setting principles to make an assessment of decision-making scenario.

Decision-making assessment starts with the decision-maker evaluation: There is no such a perfect decision maker; making the large, especially strategic decisions is not an easy task. In reality, many poor decisions are made by very intelligent people. But decision making is the professional capability which can be developed. The biggest challenge is knowing what you don’t know, it’s a reasonable moniker for decision-making blind spot and biases. It is the responsibility of each individual to examine themselves and to make sure they are open to true understanding. Often assumptions and prejudices are due to lack of deeper understanding. When you judge something, you form a critical opinion of it based on facts, discerned data, filtered information, and preconceived notions. Many times people make a poor judgment, not because of ignorance, but because of the lack of insight. Hence, good judgment is a must for good decisions. So far wisdom and knowledge have evolved in humans with their eyes and ears open to understand.

Evaluating information and processes for decision-making: At today’s “VUCA” -volatile, uncertain, complex, and ambiguous digital dynamic, the importance of the process becomes critical as decisions become more complex and involve more diverse stakeholders. Making sound processes to frame decision is critical. You need a sound process to frame the decision, spec out your options, weigh them appropriately with the right people, and actually make a decision. So the half of the battle is framing the question appropriately.  An essential part of the 'framing process' is to understand what your high-level outcomes are related to the issue, opportunity or problem. You cannot choose between alternatives without being clear about your desired outcome. With an effective process, if you mine, cleanse and improve the data to produce information, then combine that information and visualize it in different ways, then you gain organizational knowledge and from that knowledge, you can make excellent tactical decisions. Always attempt to identify areas in which measurable improvements can be realized, providing demonstrable value is essential.

There is a distinction between effective decision-making and good outcomes: Even you should be very clear about your desired outcome, there is a clear distinction between a good decision and a good outcome. In the world of uncertainty and ambiguity, the mind with decision wisdom can, by definition, not control the outcome, however, focus on making effective decisions and the best chance for a good outcome is to make a good decision. If the decision-making scenario is well designed and well-executed, you have the highest probability of getting the best outcome in the state of knowledge accessible at the time of decision-making. The decision at hand and the criteria prescribed should drive the data, with the understanding that scenario analysis may require more iterations of information or interdisciplinary knowledge. Evaluating decision outcomes will help the decision makers learn lessons that will improve decision-making maturity.

At the digital era, making sound decisions means to leverage analytical thinking, practical frameworks, advanced analytic tools, the human’s intuition, and add the “wisdom’ in the decision process to improve the overall effectiveness of decision making and achieve overall decision maturity.


Post a Comment