To keep the business system firm, the business management should fine tune crucial variables, focus on managing a portfolio of relevant cross-border strategic synergies and business interdependence.
In today’s complex business environment, there are all sorts of circumstances and there are many variables in decision-making or problem-solving. A simple variable can be both cause and effect.
Contextual variables: We live in a “VUCA” complex world where environments are continuously changing and that makes it impossible to have complete knowledge and understanding of many complex issues today. The variation in decisions to be made vary tremendously across the developmental spectrum. It’s a construct that involves the ability to recognize and diagnose the plethora of contextual variables inherent in the present circumstances.
The internal decision variables include, such as the decision goals, situation, decision context, relevant knowledge, resource, and capability. The external decision variables include technology factors, political and legal conditions, competition and consumer demands, etc. Decision-makers should have an acute awareness of present contextual variables, look at things from different angles, evaluate the dynamic circumstances, decide and act, and identify possibly unintended consequences of decisions and actions.
System variables: Decision making is in less a mathematical or fancy methodological consideration but as a sociological problem. It’s important to make extensive observations, try to identify the parts of a system and how those parts are connected, ask insightful questions, and take an intuitive grasp of relevant past events or system variables. Only after you can gather adequate data, and only after studying each independent process by asking questions about each independent variable, can you deepen understanding of the interrelationships and correlations that offer access to new perspectives and new insights, interpreting them in a cohesive way, for effective decision-making.
Running a business is an iterative continuum of decision-making and problem-solving. Business systems have "emergent properties" for composite system variable value that is more or less than the sum of partial system variable values. It is important for the organization to identify emergent business properties, and how information is associated with the valued tangibles of businesses, products, and resources, as well as how to keep improving information quality, accessibility, and integrity for effective decision-making.
The variety of variables such as supply-side variables, market variables, economies of scale, etc: The digital ecosystem is complex and volatile, being digital is the state of interconnectivity. Abundant knowledge makes today’s business professionals more informative than the previous generations. Modern technologies such as collaboration tools provide both organizations and employees an alternative to access working related information with their fingertips remotely. So the functional or geographical borders are blurred, the management needs to understand and see the connectivity between different variables, for improving their discernment in problem-solving.
You can only measure what you manage. The incomplete assessment of measurement variables would mislead the management making ineffective decisions or focus on short-term business results only. The comprehensive assessment of the measurement variable should tell the full story of business performance from both narrative and data perspectives. Each of the ROI measurement presentations to management needs to include what variables were used in the analysis for improving the overall business manageability.
High performance business today is complex enough to act intelligently and nimble enough to adapt to the change promptly. To keep the business system firm, the business management should fine tune crucial variables, focus on managing a portfolio of relevant cross-border strategic synergies and business interdependence with the appropriate mix of business elements and maintaining the right level of digital balance.
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