Org leader hw 3
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8.1DecisionMakingModels2021.pptxProblem Management and Decision Making
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What is Problem Management & Decision Making?
Problem Management - ?
Decision Making - ?
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What is Problem Management & Decision Making?
Problem Management – Activities required to diagnose the root cause of incidents and to determine resolution to those problems.
Decision Making – The thought process of selecting a logical choice from the available options. When trying to make a good decision, a leader must weigh the positives and negatives of each option, and consider all the alternatives.
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Some Bad Decisions...
"There is no reason anyone would want a computer in their home." --Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977
"Heavier-than-air flying machines are impossible." -- Lord Kelvin, president, Royal Society, 1895.
"We don't like their sound, and guitar music is on the way out." --Decca Recording Co. rejecting the Beatles, 1962.
"This 'telephone' has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us." -- Western-Union internal memo, 1876. Alexander Bell offered the patent for the Telephone to Western-Union in 1876 for $100,000. They declined. The telephone patent has been estimated as the most valuable patent of all time.
"Drill for oil? You mean drill into the ground to try to find oil? You're crazy." -- Drillers who Edwin L. Drake tried to enlist to his project to drill for oil in 1859
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Some Good Decisions...
- Apple’s decision to chase the prize of the first saleable PC created an industry.
- Henry Ford’s decision to start his own company in 1903 led to the first mass production line, created a mass market in automobiles, launched a corporate giant, changed perceptions of travel, led to the establishing of a variety of other industries, and provided a blueprint for industrial production.
- In 1981, a group of 13 senior Harley-Davidson executives led by Vaughn Beals bought the company. They celebrated with a victory ride from the company’s factory in York to its headquarters in Milwaukee. Then they made a great decision: The new owners started the Harley Owners Group (H.O.G.) to get customers more involved with the brand. It worked.
- The New Coke fiasco of 1985 was one of the worst decisions on record. So, wherein lies the greatness? The decision to go back to the original recipe was brave and (relatively) speedy. We all screw up. The brave thing to do is to hold your hands up and admit it.
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Decision Making Models
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Decision Making Models
Incremental Model
Polis Model
Garbage Can Model
Bargaining Model
Participative Model
Rational Model
Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
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Decision Making Models
Incremental Model (Charles Lindblom): Decisions are made in small analytical increments in response to events and circumstances where the decision-maker’s analysis is focused on familiar, better-known experiences.
1. Only a few options are considered
2. Decisions are the product of negotiated settlements
3. Changes are made gradually over time
4. Decisions tend to be made reactively
5. Political considerations are important in determining outcomes
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Incremental Model (Charles Lindblom): Decisions are made in small analytical increments in response to events and circumstances where the decision-maker’s analysis is focused on familiar, better-known experiences.
the attainment of short-term solutions may be at the expense of more important and far-reaching goals
small changes are more subject to correction if they produce unfavorable outcomes
decision making is slowed down in order to avoid big mistakes sometimes resulting in “kicking the can down the road”
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Polis Model (Deborah Stone): Assumes inconsistencies in life where the political community is able to deal with less than comprehensive and reliable information. Decisions are made and solutions formed with inducements, rules, rights, and powers as the driving forces. Characteristics:
State goals ambiguously and keep some secret.
Be prepared to shift and redefine goals as the political situation dictates.
Keep undesirable alternatives off the agenda by not mentioning them.
Make your preferred alternative appear to be the only feasible one.
Focus on one part of the causal chain and ignore politically difficult ones.
Use rhetorical devices to blend alternatives to prevent strong opposition.
Selectively project consequences that make your decision look the best.
Choose the action that hurts powerful constituents the least, but portray your
decision as creating the maximum social good.
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Garbage Can Model (March, Cohen, & Olsen): Decisions are made based on chance and unsystematic interactions of actors and opportunities, and the current availability of resources.
Organizations have inconsistent and ill-defined preferences, and operate on the basis of trial and error
Stakeholders only partially understand the processes
Decision-makers often act whimsically and impulsively
Organizations produce many solutions for which there are no immediate problems, and these are dumped in a holding can—the garbage can
Problems needing solutions will arise in the future and a search through the garbage can might yield a solution. In this sense, the garbage can is really an “opportunity” can.
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Bargaining Model: Bargaining reflects a decision making process both between individuals within an organization and between organizations through their representatives. This perspective requires an understanding of the principles of negotiation.
The essence of decision making of groups involves tradeoffs between constituents that may have competing interests and agendas.
In seeking to identify common interests and mutual benefit for the involved parties, some concessions may be made, but the resulting decision should produce a condition that is acceptable to either side.
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Bargaining Model: The essence of decision making of groups involves tradeoffs between constituents that may have competing interests and agendas.
Advantage: effective for addressing and presenting issues that get multiple perspectives
Disadvantage: may not result in the best alternative since consensus sometimes results in achieving a decision that all will accept
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Participative Model: The participative decision making perspective is an expansion of the bargaining approach and attempts to include all those directly affected by the decision.
It is the most democratic form of decision making.
Providing the opportunity to voice an opinion is not the same as giving power to make the decision.
Groups can wield significant power and present obstacles if not appropriately included in the decision process.
Participative decision making is slow and expensive.
An effective means to collect information, the amount and unorganized nature of the information must be addressed.
The quality of decision making depends on the expertise and commitment of participants – subordinate self-interest in pursuit of common goals.
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Decision Making Models
Rational Model: This approach, also known as “the rational-comprehensive” model, borrows from economic theory and has the goal of maximizing efficiency by picking the best alternative based on specific criteria. It is often described as a six-step process:
1. Define goals
2. Identify alternatives
3. Calculate the consequences
4. Decide the most favorable using a calculated ratio of benefits to costs
5. Monitor implementation
6. Begin again
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Gerras, S.J. (Ed.) (2010). Strategic leadership primer (3rd Ed.). Carlisle, PA: Department of
Command, Leadership, and Management; U.S. Army War College.
Don’t Forget the Intuitive Model!
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Risk: Probability & Consequence
Probability
Very Likely – occurs often, continuously experienced
Likely – occurs several times
Questionable – unlikely, but could occur at some time
Unlikely – can assume it will never occur
Consequence
High – critical objectives cannot be achieved
Significant – only the most critical objectives can be achieved
Moderate – can partially achieve all objectives
Low – can fully achieve all objectives
