Improving Decision Making in Management
Effective decisions made on individual or organizational levels are normally used to amicably solve the underlying issues. In a business perspective, a rational decision making approach will help to reduce the uncertainties and hence assemble the right resources for the right markets in the most cost effective manner. In order to improve the process of decision making, Bazerman and Moore (2008) came up with a six point strategies that could be implemented. This report attempts to position the six strategies in a chronological order that maximizes the effectiveness and reliability of the final decision that can be made.
The foremost strategy that a decision maker can take is to acquire the expertise on decision making techniques. In as much as expertise or experience is not acquired in a single exercise, having had undergone a series of decision making processes can give a decision maker the context of the situation in which a decision is to be made. At the same time, expertise in decision making can be gained through written materials such as books, journals and other electronic sources (pp 187-188). Having a pre-exposure in decision making environments, be it be in real life or case analysis, will provide a decision maker with insights on what to do and not to do, so as to avoid errors in decision making.
After the decision maker has put a problem under consideration into perspective, based on the experience obtained from previous cases, decision making tools such as statistical tools and linear models should be used to subject the case to quantitative analysis (pp 183).some decisions require in-depth analysis of available data in order to determine the probable outcomes. Policies to such cases can not be made and implemented before statistical analysis of variance. In such case, analysis tools will avail a decision maker with different alternatives and their probable strengths and weaknesses. The reason for placing this strategy after acquisition of expertise is that the latter is used to work on analysis. Therefore, before a decision maker embarks on making choices from available options, the situation should be subjected to analysis.
The third step in strategic decision making is engaging analogical reasoning in order that improves the decisions made. This process will entail comparing similar characteristics between the new idea under consideration and already learnt and experienced concepts and as such, gaining a better understanding of the new idea. Analogical reasoning is vital in decision making since information is taken from a certain source and then transferred to a target subject (pp 192). Since it is only possible to compare qualities from information that is available to the decision maker, this information is retrieved from analyzed data sets from the previous step. Information from analysis models and programs is synthesized such that it helps in making informed decisions that are free from bias. More often than not, subjecting a situation to analogical reasoning improves that reliability of decisions made. Many cases in certain organizations tends to have a similar orientation and therefore, analogical reasoning may shorten the process of decision making if the cases are more similar to already experienced lot.
In event that analogical reasoning does not give an almost match of the new situation to an experienced one, other points of view will then be considered. This will involve taking points of view from independent outsiders, who have no direct influence from the decision making panel, if it is possible (pp 195). Taking a neutral position during this exercise is a prerequisite, since it ensures that issue 4s of geocentrism are countered. During the initial steps discussed, a decision maker may have failed to include an important component that in effect could change the outcomes of opted alternatives. Taking views of outsiders will therefore ensure that all factors have been considered before an alternative is selected.
The fifth chronological strategy is to develop an understanding of biases in views that are provided by others (pp 195-198). In essence, we need to understand not only our own prejudices but also viewpoints of others that shape our thinking and decision making capacities. The more one analyses other viewpoints, the more they are found to be biased. An understanding of these biases will help the decision maker to evaluate important matters that require reasoned decisions. For instance, when a decision maker comes across other points of view, he or she must analyze and establish whether they are subjective or objective. Subjective points serve only as opinions of an individual, which might or might not influence the final decision. On the other hand, objective views are necessary for consideration since they provide factual information about a problem, and therefore could influence the decision making processes. An understanding and evaluation of other points of view can be successfully achieved after listening or considering the views first. This is the reason as to why the author thinks that the step comes after taking outsiders’ views.
The last strategy to be considered in an effort to improve decision making is to de-bias your own judgment. Taking an outsider’s point of view on an issue has been shown to minimize the tendency for overconfidence to bias judgments (pp 189-190). As we have seen in the previous paragraphs, other points of view will help in expanding the way in which a decision maker perceives the problem at hand. After taking other views, it is imperative that a decision maker should understand and establish the biases in these views. This understanding will then assist the individual to ascertain his or her own biases in the decisions they are about to make and thereby eliminating them. The idea of debiasing one’s judgment is to remove oneself mentality from a specific situation.
The author believes that the order of strategies as discussed above would yield better results than other possible positions. The reason behind this postulation is that, in the above chronological order, preceding strategies contributes to the implementation of succeeding strategy. For instance, acquisition of expertise can only be the first step in the process or the last one. Analysis of the decision situation can not be effectively conducted without the relevant expertise on how to execute it. Although taking other parties’ points of view may be placed in the second place before analysis, it is more effective to analyze factual information before considering other points of view. This is so because the decision maker might end up mixing factual information with mere opinions from outside views, which would jeopardize the entire process of decision making. Furthermore, considering other points of views will assist in debiasing the decision maker’s judgment. As such, other points of view can not come after debiasing judgment.
Bazerman, M and Moore, D.A, (2008). Judgment in Managerial Decisions. Wiley: Hoboken.