decision making & problem solving skills

8/6/2019 Decision Making & Problem Solving Skills

1/39

Decision Making SkillsDecision Making Skills

Personal Development Club Training Activities


2/39

ContentsContents

I. Decision Making An Overview1. Functions of Mind

2. The Depth of Mind (Subconscious)

II. The Classic Approach to Decision Making1. Define objectives

2. Collect relevant information

3. Generate feasible options

4. Make the decision5. Implement and evaluate

III. Eight Elements of Smart Choices


3/39

IV. Techniques for Effective Decision-Making

Skills1. Pareto analysis2. Paired comparison analysis

3. Grid analysis

4. Decision trees

5. Plus/Minus/Implication (PMI)

6. Force field analysis

7. Impact Analysis

V. Improving Decision Making

1. The Ladder of Inference2. Six Thinking Hats

3. Reactive Decision-Making

VI. Psychological Traps to Decision-Making


4/39

I. Decision MakingI. Decision Making An OverviewAn Overview

y Decision making can be regarded as the mentalprocesses (cognitive process) resulting in theselection of a course of action among severalalternatives.

y Other definitions: From psychological perspective: decision is made

based on the context of a set of needs, preferencesan individual has and values they seek.

From cognitive perspective: decision is made as a

continuous process integrated in the interaction withthe environment.

From normative perspective: decision is made inconcern with the logic of decision making andrationality and the invariant choice it leads to


5/39

1. Functions of Mind1. Functions of Mind

Separating a whole

into its constituent

parts.

Establishing success criteria,

evaluating, appraising performance,

and judging people.

Putting things together

to make it a whole.


6/39

2. The Depth of Mind (Subconscious)2. The Depth of Mind (Subconscious)

y Level 1: You dont know

that you dont know.

y Level 2: You know thatyou dont know.

y Level 3: You know that

you know.

y Level 4: You dont know

that you know.

The Conscious Competence

Ladder


7/39

II. The Classic Approach to Decision MakingII. The Classic Approach to Decision Making

y Step 1: Define objectives

y Step 2: Collect relevant information

y

Step 3: Generate feasible optionsy Step 4: Make the decision

y Step 5: Implement and evaluate

Not to decide is to decide.


8/39

1. Define Objectives1. Define Objectives

y Ask yourself:

What you want to achieve

If you dont know what port you are heading

for, any wind is the right wind.


9/39

2. Collect Relevant Information2. Collect Relevant Information

y It is a good principle not to make decisions in

the absence of critically importance information

that is not immediately to hand.

Required

InformationAvailable

Information


10/39

3. Generate Feasible Options3. Generate Feasible Options

y Brainstorm for possibilities

y Generate feasible options.

y Form alternatives

y Select the course of actions

The Lobster

Pot Model


11/39


12/39


13/39

5. Implement and Evaluate (cont)5. Implement and Evaluate (cont)

y In case of simple choice, use your

conscious mind.

y In case of complex choice, use your

subconscious mind

y Our subconscious mind can best process

all the complex information that comes

from another person and transform itinto a simple but profound judgment.


14/39

III. Eight Elements of Smart ChoicesIII. Eight Elements of Smart Choices

y Problem

y Objectives

y

Alternativesy Consequences

y Tradeoffs

y

Uncertaintyy Risk tolerance

y Linked decision


15/39

IV. Techniques for Effective DecisionIV. Techniques for Effective Decision

Making SkillsMaking Skills

y Pareto analysis

y Paired comparison analysis

y Grid analysisy Decision trees

y Plus/Minus/Implication (PMI)

y Force field analysis

y Impact Analysis


16/39

1. Pareto Analysis1. Pareto Analysis

y Selecting the most important/most

beneficial changes to make.

y How to use tools:

List the problems you face, or the options

you have available.

Group options where they are facets of the

same larger problem. Apply an appropriate score to each group.

Work on the group with the highest score.


17/39

2. Paired Comparison Analysis2. Paired Comparison Analysis

y Evaluating the relative importance ofdifferent options and set priorities whenthere are conflicting demands on yourresources.

To use the technique, compare each optionwith each other option, one-by-one.

For each comparison, decide which of the twooptions is most important, and then assign a

score to show how much more important it is.

You can then consolidate these comparisonsso that each option is given a percentageimportance.


18/39

2. Paired Comparison Analysis (cont.)2. Paired Comparison Analysis (cont.)

y How to use tools:

1. List the options you will compare. Assign a letter to each option.

2. Set up a table with these options as row and column headings.

3. Block out cells on the table where you will be comparing an

option with itself (the diagonal from top-left to bottom-right).4. Also block out cells on the table where you will be duplicating a

comparison. Normally, these will be the cells below the diagonal.

5. Within the remaining cells, compare the option in the row withthe one in the column. For each cell, decide which of the two

options is more important.Write down the letter of the more

important option in the cell, and score the difference inimportance from 0 (no difference) to 3 (major difference).

6. Finally, consolidate the results by adding up the total of all the

values for each of the options. You may want to convert these

values into a percentage of the total score.


19/39


Case: you need to decide to buy only one

among these items: cell phone, laptop,

motorbike, and Playstation 3.

Cell phone

(A)

Laptop

(B)

Motorbike

(C)

PS3

(D)

Cell phone

(A)Step 3

Laptop

(B) Step 4 Step 3

Motorbike

(C)Step 4 Step 4 Step 3

PS3

(D)Step 4 Step 4 Step 4 Step 3


20/39


y Finally add up the A, B, C and D values, and converts each into apercentage of the total. This gives these totals: A=1 (12.5%), B =5 (62.5%), C = 2 (25%), D = 0.

y Thus, you may decide to buy a new laptop, and then a newmotorbike. Other two might not be as necessary as the first.

Cell phone

(A)

Laptop

(B)

Motorbike

(C)

PS3

(D)

Cell phone

(A)B2 C1 A1

Laptop

(B) B1 B2

Motorbike

(C)C1

PS3

(D)


21/39

3. Grid Analysis3. Grid Analysis

y Selecting between good options while manyfactors to take into account.

y How to use tools:

1. List your options and then the factors that areimportant for making the decision.

2. Score each option for each of the important factorsin your decision (from 0 [poor] to 3 [very good]).

3. Work out the relative weights of the factors inyour decision (variable value).

4. Multiply the scores by the weights, and totals them.


22/39

3. Grid Analysis (cont.)3. Grid Analysis (cont.)

Cost System Storage Graphic Design Total

MAC 1 3 1 3 3

SONY 2 2 2 2 2

DELL 3 2 3 2 2

HP 3 2 3 2 1

Cost

5

System

4

Storage

4

Graphic

3

Design

2Total

MAC 5 12 8 9 6 40

SONY 10 8 8 6 4 36

DELL 15 8 12 6 4 45

HP 15 8 12 6 2 43


23/39

4. Decision Trees4. Decision Trees

y Choosing between options by projecting likelyoutcomes.

y Clearly lay out the problem so that all optionscan be challenged.

y Allow us to analyze fully the possibleconsequences of a decision.

y Provide a framework to quantify the values of

outcomes and the probabilities of achievingthem.

y Help us to make the best decisions on the basisof existing information and best guesses.


24/39

4. Decision Trees (cont.)4. Decision Trees (cont.)

y How to use tools:

Start a Decision Tree with a decision that you need tomake (square represents decision).

From this box draw out lines towards the right for each

possible solution, and write that solution along the line(lines represent solutions or outcomes).

At the end of each line, consider the results. If the resultof taking that decision is uncertain, draw a small circle(circle represents uncertain outcomes).

Write the decision or factor above the square or circle.

If you have completed the solution at the end of the line,just leave it blank.


25/39

An example of the

sort of thing you will

end up with.


26/39


27/39

the calculation

of uncertain

outcome nodes


28/39

By applying this techniquewe can see that the best

option is to develop a new

product. It is worth much

more to us to take our time

and get the product right,

than to rush the product tomarket. It is better just to

improve our existingproducts than to botch a

new product, even though it

costs us less.


29/39

5. Plus/Minus/Implication (PMI)5. Plus/Minus/Implication (PMI)

y Weighing the Pros, Cons, and implications ofa decision.When you have selected a courseof action, PMI is a good technique to use tocheck that it is worth taking.

y How to use tools:

'Plus', write down all the positive results oftaking the action.While 'Minus' write down

all the negative effects. 'Implication' write down the interests and

possible outcomes of taking the action,whether positive, negative, or uncertain.


30/39

5. Plus/Minus/Implication (PMI) (cont.)5. Plus/Minus/Implication (PMI) (cont.)

Plus Minus Implication

More going on (+5) Have to sell house (-6)Easier to find new job?(+1)

Easier to see friends

(+5)More pollution (-3) Meet more people? (+2)

Easier to get places (+3) Less space (-3)

More difficult to get own

work done? (-4)

No countryside (-2)

More difficult to get towork? (-4)

+13 -18 -1

Case: A young professional is deciding where to live.

Her question is 'Should she move to the big city?

She draws up the PMI table below:


31/39

6. Force Field Analysis6. Force Field Analysis

y Force Field Analysis is a useful technique forlooking at all the forces for and against adecision.

y By carrying out the analysis you can plan to

strengthen the forces supporting a decision,and reduce the impact of opposition to it.

Describe your plan or proposal for change in themiddle.

List all forces for change in one column, and allforces against change in another column.

Assign a score to each force, from 1 (weak) to 5(strong)


32/39


33/39

7. Impact Analysis7. Impact Analysis

y Identifying the full consequences of change.Capture and structure all the likely conse-quences of a decision; and then ensurethat these are managed appropriately.

y To conduct effective impact analysis:

Prepare for impact analysis

Brainstorm major areas affected

Identify all areas

Evaluate impacts

Manage the consequences


34/39

V. Improving Decision MakingV. Improving Decision Making

y The ladder of inference

y Six thinking hats

y Reactive decision making


35/39

1. The Ladder of Inference1. The Ladder of Inference

y The Ladder of Inference describes the thinking process thatwe go through, usually without realizing it, to get from a factto a decision or action.

Experience these selectively based on our

beliefs and prior experience.

Interpret what they mean.

Apply our existing assumptions, sometimes

without considering them.

Draw conclusions based on the interpreted facts

and our assumptions. Develop beliefs based on these conclusions.

Take actions that seem "right" because they are

based on what we believe.


36/39

2. Six Thinking Hats2. Six Thinking Hats

y Six Thinking Hats is a good technique for looking atthe effects of a decision from a number of differentpoints of view.

Information: (White) - considering purely what informationis available, what are the facts?

Emotions (Red) - instinctive gut reaction or statements ofemotional feeling (but not any justification).

Bad points judgment (Black) - logic applied to identifyingflaws or barriers, seeking mismatch.

Good points judgment (Yellow) - logic applied to identifying

benefits, seeking harmony. Creativity (Green) - statements of provocation and

investigation, seeing where a thought goes.

Thinking (Blue) - thinking about thinking.


37/39

3. Reactive Decision3. Reactive Decision--MakingMaking

y Reactive decision making usually happens

in case of emergency or when a disaster

unfolds.

y In such case(s), Steps of Classic Approach

to effective Decision-Making cannot be

fully followed. Bad decision is more likely

to happen. So contingency plan is highlyneeded.


38/39

3. Reactive Decision3. Reactive Decision--Making (cont.)Making (cont.)

y Planning for exceptional reactive decision-making:

Look at the risks you face and determine if they havea high or low probability of occurring.

Use a Risk Assessment Matrix (RAM): draw a simple

table with a vertical axis marked as "Consequences"and a horizontal axis marked as "Probability".

Use a simple scale of 0 (very small) to 5 (very large)."Consequences" are credible potential worst-casescenarios that may develop.

Brainstorm the possible consequences to whichyou're exposed and assess the risk of eachconsequence occurring.

Plot these into RAM.


39/39

VI. Psychological Traps to DecisionVI. Psychological Traps to Decision--MakingMaking

y Overrelying on first thought

y Keeping on keeping ony Protecting earlier choicesy Seeing what you want to see

y Posing the wrong questionsy Being too sure of yourself

y Focusing on dramatic events

y Neglecting relevant information

y

Slanting possibilities and estimatesy Seeing pattern where none exists

y Going mystical about coincidencesy Forewarned is forearmed

decision making & problem solving skills

Documents