Problem Solving and Decision Making Skills - Tarak Bahadur KC, Ph.D. tarakbkc@gmail.com

The moment we all open our eyes in the morning, the decision process begins, and continues to happen all throughout our day until we fall asleep at the end of it, whether we are aware of said process or not. We are thus all decision makers. Whether we are right decision makers or not is the question. However, even if one is not a right decision maker, one need not fret – it is an ability that can be learned by anyone.

Session Outline Meaning of Problem Solving and Decision Making Approaches / Styles and Process of Decision Making Problems in Decision Making Approaches / Tips for Effective Decision Making

Methodology Interactive lecture Exercise Video clip Individual – Identification of DM Style / Approach, Test Yourself Video clip

Problem “In a day, when you don’t come across any problems- you can be sure that you are traveling in a wrong path.” Swami Vivekananda A problem is a situation or a state of affairs that causes difficulties for people. It is also a gap between a current and a desired state. The gap may be viewed as the difference between 'what is' and 'what should be' or 'where we are' and 'where we want to be'.

Do you want to do something Do you have a problem? Actual Situation Desired Situation Is there a difference No Yes Do you want to do something about that difference? No Yes Do you know what to do and when to do it? Yes No You do not have a problem You do have a problem

Reactions to Problem / Situation Ignore or avoid Act without thinking Positively decide to do nothing Take decisions only when there is a crisis or pressure Take action only after gathering information and giving some thought

Problem Solving If a problem is a gap between two states, then problem solving is 'the process of closing that gap, i.e. changing the current state into the desired one.'

Decision A Choice between or among “A Decision is a Judgment” A decision is one when there are different things you can do and you pick one of them. “A Decision is a Judgment” Peter Drucker A Choice between or among Various Alternatives to solve problems

Classification of Decisions Personal decisions to achieve own objectives. Organisational decisions to fulfill the obligations of own position in the organisation. They can be: Programmed Non-programmed

Organizational Decisions Non-programmed Decisions Top Level in Organization Bottom Ill-structured Type of Problem Well-structured Programmed Decisions

Non-programmed Decisions A decision that is repetitive and routine and can be made on the basis of pre-established definite rules and systematic procedures. Non-programmed Decisions A decision that is unique and novel. Established rules / procedures are inadequate to deal with the new kinds of situations, and the decision maker has to be innovative. Decisions made about non-recurring problems for which there are no pre-specified courses of action. The risks involved are high.

Decision Making --- is the selection of one behaviour alternative from two or more possible alternatives. Terry --- is an activity carried out in the process of solving problems.

Importance of Decision Making A key role of a manager Whatever a manager does, he does through making decisions No organisations can be run without making decisions Carries long-term implications. Organisations grow or fail as a result of decisions by its managers. The wellbeing of an organisation depends almost entirely on the quality of its decisions. Objective of decision making is solving problem

Decisions can be through: INTUTION (Gut Feeling – past experience and personal values) REASONING (Facts and Figures)

Flashback Write down any two important decisions you have made in recent past.

Exercise: Identify your Approach / Style What you do while making a decision, rank the following statements? A The manager makes decisions and announces them B The manager sells the decision to the team C The manager presents the idea and invites questions D The manager presents a tentative decision subject to change E The manager presents a problem, gets inputs from the team and then decides F The manager defines the limits and asks the group to make the decision G The manager permits the team to make decisions with predefined limits H The manager allows team members complete freedom of action

Approaches / Styles to Decision Making Authoritarian - deciding independently seeking no contributions other than asking for necessary information and passing them down the line for implementation. Democratic - jointly, as a team, making a decision which has the support of the whole group. The responsibility for decision making is shared between the officer and members of a team.

Range of Decision Making Styles Authoritarian Style Democratic Style The officer makes decisions and announces them The officer sells the decision to the team The officer presents the idea and invites questions The officer presents a tentative decision subject to change The officer presents a problem, gets inputs from the team and then decides The officer defines the limits and asks the group to make the decision The officer permits the team to make decisions with predefined limits The officer allows team members complete freedom of action

Refer your list Think about how you made each of those decisions. What approach / style you followed in making those decisions?

Approaches / Styles to Decision Making No one style appropriate for all situations. Occasions when one style rather than any other is more likely to produce better quality decisions implemented with greater success. Need to adopt a flexible approach by varying style in response to the nature of the decision and the context in which it is made and ultimately implemented.

Decision-Making Procedure Although people can learn at different rates – some more quickly than others of course – there are no short cuts to learning and everyone has to follow a similar learning process to learn how to make right decisions. One of the things that can be learned is a specific process to make a decision.

Rational Decision Making Process Pre-decision phase Issue or problem identification: agenda setting Analysis of issue or problem: Interpretation, identification and understanding through: SWOT analysis PEST analysis Stakeholder analysis Spoiler analysis

Decision phase Ranking the alternatives Determination Choice Rational … Designing alternatives Examination/assessment of alternatives Decision phase Ranking the alternatives Determination Choice

Post-decision phase Re-decision phase Rational … Preparedness for implementation Action plan Monitoring Feedback Evaluation Re-decision phase Acknowledging the lessons learnt Reformed/improved decision making

Creative Decision Making Process Understand the barriers to creative thinking Exercise: Blocks to Creative Thinking Develop capacity for creative thinking by: - looking at the situation differently - exchanging ideas with other creative people - thinking outside the box - leaving it for a while Use collective capacities of group to develop new ideas by “brainstorming”

Techniques for Creative Decision Making Brainstorming Ideas writing Lateral thinking

Ethics and Morality in Decision-Making Ethics is defined as the branch of philosophy that defines what is good for the individual and society, and which establishes the nature of obligations or duties which people owe both themselves and one another. Making ethical decisions in business is often difficult because business ethics is not just an extension of either an individual’s or a society’s ethics. However, the following support being ethical:

Trustworthiness - others believe in us and hold us in high esteem; concerns qualities such as honesty, reliability, integrity and loyalty. Respect – we should treat everyone with respect regardless of who they are and/or what they have done. Responsibility – we have to be accountable for what we do and who we are.

Fairness – adherence to a balance standard of justice without relevance to one ’s feelings or inclinations. Caring – the heart of ethics and ethical decision-making; we should consciously cause no more harm than is reasonably necessary to perform our duties. Citizenship – this includes civic virtues and duties which tell us how we ought to behave as part of a community. Ethical Dilemma_(360p).mp4

Factors Influencing Decision Making Availability of resources Environment: Internal, External Capability (KSA), values, experience, emotion, biasness of concerned people Prejudice

Problems in Decision Making Real life Decision Makers must cope with: Inadequate information about the nature of the problem and its possible solutions, The lack of resources to acquire more complete information, Distorted perceptions of the information available, The inability of the human memory to retain large amount of information, and The limits of their own intelligence to determine correctly which alternative is best. - Herbert Simon

Problems … Which problem to solve? What is a right decision? External and internal environment (PEST) Ownership of decision Decisiveness, ethics and integrity of decision makers Failing to consult others Innovation / creativity? Individual's values, capabilities, biasness Influencing factors Conflicting information For some “thinking” is not “work”

Some Common Decision-Making Mistakes Relying too much on “expert ” information. Experts are only human and have biases and prejudices like the rest of us. Seek information from a lot of different sources. Overestimating the value of information received from others. They may not know as much about the problem as you may. Their values may be different. The bottom line is that it is important to keep their opinions in perspective.

Underestimating the value of information received from others Underestimating the value of information received from others. We may tend to discount information we receive from individuals such as children, low status groups, blue-collar workers or even women. We should not do so as information from these and other such groups can help us gain a better perspective of the problem as a whole, and Only hearing what you want to hear or seeing what you want to see. Be aware of your prejudices and expectations.

Exercise : How good are your Decision-Making Skills?

Score Comment 18-42 Your decision-making hasn't fully matured. You aren't objective enough, and you rely too much on luck, instinct or timing to make reliable decisions. Start to improve your decision-making skills by focusing more on the process that leads to the decision, rather than on the decision itself. 43-66 Your decision-making process is OK. You have a good understanding of the basics, but now you need to improve your process and be more proactive. Concentrate on finding lots of options and discovering as many risks and consequences as you can. The better your analysis, the better your decision will be in the long term. Focus specifically on the areas where you lost points, and develop a system that will work for you across a wide variety of situations. 67-90 You have an excellent approach to decision-making! You know how to set up the process and generate lots of potential solutions. Think about the areas where you lost points, and decide how you can include those areas in your process.

Basic Approaches to Improve Decision Making Ability Improve analytical ability Adopt systematic approach Invite conflicting views Consider factors influencing decision making Use imagination / Be creative Implementation and follow-up

Some Tips for Effective Decision Making Effective decision making means you make things happen instead of letting things happen. You will find that making decisions are required in every activity. These decisions will take place in a situations and problems and can range from the very simple to very complex. You as a senior manager must make the right decisions to direct and guide events and actions into a planned course instead of letting events fall to chance. Making right decisions is a skill like any other and needs to be practiced.

What is right, not who is right Some Tips … It is not choice between right or wrong, rather choosing from among alternatives Avoid snap decisions What is right, not who is right Consider those affected by the decision (involve if feasible) Mentally rehearse implementation of your choice

View a ‘problem’ as an ‘opportunity’ Some Tips (Contd..) View a ‘problem’ as an ‘opportunity’ Decision must meet the situation, and be acceptable to as large number of people as possible Choosing the right alternative at the wrong time is not any better than the wrong alternative at the right time, so make the decision while still have time

“You can't make decisions based on fear and the possibility of what might happen.” - Michelle Obama

Conclusion Effective decision making / problem solving requires creativity. Creative thinking is hindered by perceptual blocks, emotional blocks and cultural / environmental blocks. Therefore, first thing is to overcome from the blocks and be creative in different course of action, likely causes, possible solutions, and a variety of outcomes.

Never base your life decisions on advice from people who don’t have to deal with the problem. “Whenever you see a successful business, someone once made a courageous decision.”- Peter Drucker

Krishna Seekh - Impact of decision making in our lives “Think Laterally, and be Creative.”