1. Two kinds of decision making.
2. Making Ethical Decision.
3. Evidence-Based Decision making & Analytics.
4. Four general Decision-making styles.
5. How to overcome barriers to decision making.
6. Group Decision Making : How to work with others.
Lets start right now !
Two kinds of decision making
A decision is a choice made from among available alternatives. And Decision Making is the process of identifying and choosing alternative course of action. There are 2 kinds of Decision Making that you will find below .
Before you know the two kinds of decision making , would be more better you to know Decision Making in real world.So first we will talk about Two system of decision making :
1. System 1 : intuitive and largely unconscious : This system operates automatically and quickly .
2. System 2 : analytical and conscious : Slow, Deliberate, analytical, and consciously effortful mode of reasoning.
The Curse Of Knowledge :
Simply the curse of knowledge is the conditions that happens because you are to smart by your knowledge and that make you can't see "Something" from the others people perspective. You just only see from your perspective maybe similar like PI (Penting Iba) in balinesse culture.
Now we talk seriously about 2 kinds of decision making
1. Rational Decision Making : Managers should make logical & optimal decision
The rational model of decision making also called as the classical model. These explains how managers should make decision based on the logical decision that will be optimum in furthering the organizations best interest.
This is the step of rational decision making :
Lets talk the stage 1 by 1
Stage 1 : Identify , here you should identify 2 things first is problems or difficulties that inhibit the achievement of goals for example customers complain, Supplier breakdown, staff turnover and the others . Second is Opportunities Situations that present possibilities for exceeding existing goals.
When you faces this 2 things you should make the decision to change your problems or opportunities to the better one so here you need the Diagnosis (Find why the problems can happens)
Stage 2 : Think up the solutions , of course after you know your problems , opportunities and you have know your diagnosis (the cause of your problems) You should find way to fix it through the alternative solutions it should be both obvious & creative.
Stage 3 : Evaluate alternative & Select a solution, after you find a lot way to fix your problems you need to evaluate it , find the best one and use that as the final decision. There are something you need to pay attention here. First Your solution must be Ethical if your plant not ethical simply don't choose it. Second Feasible don't chose the solution that have short time effect, high cost, unavailable or customer resistant solutions. Third is Effective if your solution is good enough but not optimal in long run , you should reconsider it.
Stage 4 : Implement & Evaluate , Of course the solution is just solution you can fix your problems if you are not implement your solutions to your company . So ? here you must know 2 things :
1. How To Create Successful Implementation :
Plan carefuly = make the solution more focus , don't let the small things mess up your solutions do it carefully write it on the paper and consider it again again and again until your plan is have small risk .
Be Sensitive To Choose Affected = You should think about the people who will affected by your solutions , make sure all the people can get the same benefits. Because without people you can't do nothing !
2. Evaluation
Here you must think and analyze is that your solutions good or not. if good go continue it , if your solutions i not good you can do these things :
Give it more time : To make sure your solution is not working because of lack time to implemented it .
Change it slightly : This should you do when your solution is correct but error because of small things that you need to be fixed.
Try another alternative : Use the plant B if the plant A are can't be used.
Start Over : If no alternative seems workable , you should recreate your decisions start it again from the bottom .
Whats wrong in rational model ? The rational model give you / managers perspective to create the decisions not the actually managers make the decisions. You can do rational model in the conditions you know or complete all the information , you should make unemotional analyze and able to make best decision to the company it self which is so hard to do that .
FINISH WITH RATIONAL DUDE !
2. Non-rational decision making : Managers find it difficult to make optimal decisions .
This explain how managers make decisions , they assume that decision making is nearly always uncertain and risky that making the managers difficult for managers to make optimal decisions.
Here there are 2 non rational model of decision making , lets check it out guys!
1. Bounded Rationality & The Satisficing Model : "Feel Satisfactory is good enough"
Here we learn the managers could not act truly logically because their rationality was bounded by so many distraction . So Bounded Rationality is the concept suggest that the ability of decision makers to be rational is limited by numerous constraints such as (see in the picture!):
2. The Intuition Model : "it just feel right"
Okay , the intuition model is making a choice without the use of conscious thought or logical inference . i can say this as 'Your heart say' lol. it's important to train your intuition skill because its important as rational analyze in many decisions. Some suggestion can you see below :
Making Ethical DecisionsAll these concerns have forced the subject of right-minded decision making to the top of the agenda in many organizations. Indeed, many companies now have an ethics officer, someone trained about matters of ethics in the workplace, particularly about resolving ethical dilemmas.
To create the decisions we should follow a decision tree !
a decision tree is a graph of decisions and their possible consequences, it used to create a plan to reach a goal ! this is the road map ! :
just that Bro ! now NEXTT !!
Evidence-Based Decision Making & Analytic
Oke lets talk about the Evidence-based Decision first !
so here we must know Seven implementation Principles :
1. Treat your company as unfinished prototype
Leader or manager need to think their company as unfinished prototype the managers should listen the new ideas and innovation from their company or costumers.
2. No brag, just factWhen you want to the something, you must have clear data to create the decision in the case you need to do that .
3. See yourself and your organization as outsider do
Stop see something only just from your own perspective , try to ask suggestion to your mentor, friends or the other expert people.
4. Evidence-based management is not just for senior executives
The company not only about senior executive but also about the employees and all the small part of it. So all the people in the company is guided by the responsibility to gather an act on quantitative or qualitative data and share the results each others
5. Like everything else, you still need to sell it
6. If all else fails , slow the spread of bad pratice
Because many managers and employees face pressures to do things that are known to be ineffective, it may be necessary for you to practice “evidence-based misbehavior" that is, ignore orders you know to be wrong or delay their implementation.
7. What happens when people fails ?
Fail is the usual things , use our failure to repair your company in the future !
What makes it hard to be evidence based ? 1.) There's to much evidence
2.) There's not enough good evidence
3.) The evidence doesn't quite apply
4.) People are trying to mislead you
5.) You are trying to mislead you
6.) The side effect outweight the cure
7.) Stories are more persuasive
Now we talk about In Praise of Analytics .Analytic or business analytics is the term used for sophisticated forms of business data analysis. here we will talk about three key attributes among analytics competitors :
1. Use of modeling : Going beyond simple descriptive statistics
Here you will find Predictive Modeling is a data-mining technique used to predict future behavior and anticipate the consequences of change .
2. Having multiple applications, not just one
3. Support from the top
The Uses of "Big Data"Big data includes not only data in corporate databases but also web-browsing data trails, social network communications, sensor data, and surveil-lance data. Big data analytics is the process of examining large amounts of data of a variety of types to uncover hidden patern, unknown correlations, and other useful information.
Four General Decision-Making styles A decision-making style reflects the combination of how an individual perceives and responds to information. Before you know the 4 general decision-making you should know Value orientation & Tolerance ambiguity
Value orientation : Reflects the extens to which person focuses on either task and technical concern or people and social concern when making decisions
Tolerance for ambiguity : This individual difference indicates the extent to which person has a high need for structure or control in his or her life.
Now 4 general decision making styles !
1.) The directive style : Action-Oriented (Decision makers who focus on facts)
2.) The analytical style : Careful Decisions makers who like lots of information & alternative choices
3.) The conceptional style : Decision makers who rely on intuition & Have long term perspective
4.) The behavioral style : The Most People-Oriented Decision Makers
Which style do you have ? you can knowledge it by these way :
- Know thyself
- Influence others
- Deal with conflicts
How to overcome barriers to decision making
1. Decision making & expectations about happines
You should thinking about the happines when you create the decision , all the people should enjoy the justice or fair benefits based on their job ! make sure of all of your employee wealth and faith when you create the decision
2. How Do Individuals respond to a decision situation?
Four ineffective reactions :
1.) Relaxed Avoidence "There’s No Point in Doing Anything; Nothing Bad’s Going to Happen." : relaxed avoidance, a manager decides to take no action in the belief that there will be no great negative consequences.
2.) Relaxed Change "Why Not Just Take the Easiest Way Out?" : relaxed change, a manager realizes that complete inaction will have negative consequences but opts for the first available alternative that involves low risk.
3.) Defensive Avoidance "There’s No Reason for Me to Explore Other Solution Alternatives." : In defensive avoidance, a manager can’t find a good solution and follows by (a) procrastinating, (b) passing the buck, or (c) denying the risk of any negative consequences.
4.) Panic "This Is So Stressful, I’ve Got to Do Something Anything to Get Rid of the Problem!" :In
panic, a manager is so frantic to get rid of the problem that he or she can’t deal with the situation realistically
Three effective reactions :
1. Importance “How High Priority Is This Situation?”: You need to determine how much priority to give the decision situation. If it’s a threat, how extensive might prospective losses or damage be? If it’s an opportunity, how beneficial might the possible gains be?2. Credibility “How Believable Is the Information about the Situation?” : You need to evaluate how much is known about the possible threat or opportunity. Is the source of the information trustworthy? Is there credible evidence?3. Urgency—“How Quickly Must I Act on the Information about the Situation?” : Is the threat immediate? Will the window of opportunity stay open long? Can actions to address the situation be done gradually?
1. Importance “How High Priority Is This Situation?”: You need to determine how much priority to give the decision situation. If it’s a threat, how extensive might prospective losses or damage be? If it’s an opportunity, how beneficial might the possible gains be?2. Credibility “How Believable Is the Information about the Situation?” : You need to evaluate how much is known about the possible threat or opportunity. Is the source of the information trustworthy? Is there credible evidence?3. Urgency—“How Quickly Must I Act on the Information about the Situation?” : Is the threat immediate? Will the window of opportunity stay open long? Can actions to address the situation be done gradually?
3. Nine common decision-making biases : Rule of thumb or "Heuristics"
Heuristics that is strategies that simplify the process of making decisions
1.) The availibility bias : Using only the information available
2.) The representativeness bias : Faulty generalizing from a small sample or a single event
3.) The confirmation bias : Seeking information to support one's point of view
4.) The sunk of bias : Money already spent seems to justify continuing
5.) The anchoring & Adjustment bias : being influenced by an initial figure
6.) The over confidence bias : Blinds to one's own blindness
7.) The hindsight bias : that i knew it all along effect
8.) The farming bias : Shaping how a problem is presented
9.) The escalation of commitmen bias : Feeling overly invested in a decisions
Group Decisions making : How to work with others
okay , here you should know first about the advantage and the disadvantage !
Advantages :
1.) Greater pool of knowledge
2.) Different perspective
3.) Intellectual stimulation
4.) Better understanding of decision rationale
5.) Deeper commitment to the decisions
Disadventages :
1.) A few people dominate or intimidate
2.) Group think (occurs when group members strive to agree for the sake of unanimity and thus avoid accurately assessing the decision situation.)3.) Satisficing
4.) Goal displacement (occurs when the primary goal is subsumed by a secondary goal.)
Now jump to the What Managers Need to know about groups & decisions making.
1. They are less efficient
2. Their size affects decisions quality
3. They may be too confident
4. Knowledge Counts
Done bruh ! lets go to the next level !
Group problem-solving techniques : Reaching for concensusBefore we start we need to know what is concensus ? Concensus is the things that occurs when members are able to express their opinions and reach agreement to support the final decision.
How to achieve concensus ? Here is the answer :
1.) Dos : use active listening skills involves many members as possible
2.) Don'ts : Avoid log rolling and horse trading
More group problem-solving techniques
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