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Decision Making
by M. Afzal Janjua

   The crisis of modern life, is a crisis of "knowingness": people do not understand themselves, and they make political decisions without understanding the forces that govern perception and behavior.
--Jonathan Lear, Professor of philosophy.

Decision Making
by M. Afzal Janjua

Decision Making is an unavoidable managerial function.Even in non-work situations, it cannot be avoided. Whether it is work or leisure, earning or spending, teaching or learning, leading or following, building or demolishing, reading or writing, or any other activity decision making, determines the outcome and quality.

There are good decisions and bad decisions, prompt decisions or delayed decisions, programmed (routine) and non-programmed (out of routine decisions,) considered or intuitive decisions, personal or national level decisions. For managerial decisions of all types and levels; knowing the techniques and tools matters a lot .

The rational decisions module is very popular but being demanding and time consuming; it is supplemented by the Bounded Rationality to help managers meet the daunting task of making decisions at work. The rational model involves steps like determining the problem, developing alternate solutions, evaluating alternates, choosing the best alternate, verifying and applying the solution. Bounded rationality suggests that the number of alternates developed is limited and the level of satisfaction of the decision maker is more reasonable to ensure making decisions within time limits, which is difficult, is the number of alternates, is large and the decision makerís level of satisfaction or aspiration is very high.

Thinking is the very basis of decisions making. So let us concentrate on it.Here I am not going into the details of the modules but presenting an interesting tool that I am sharing with you. It is based on the concept given by Edward De Bono the well known authority on thinking.

Each 'Thinking Hat' is a different style of thinking. These are explained below:

With this thinking hat you focus on the data available. Look at the information you have, and see what you can learn from it. Look for gaps in your knowledge, and either try to fill them or take account of them.
This is where you analyze past trends, and try to extrapolate from historical data.

'Wearing' the red hat, you look at problems using intuition, gut reaction, and emotion. Also try to think how other people will react emotionally. Try to understand the responses of people who do not fully know your reasoning.

Using black hat thinking, you look at all the bad points of the decision. Look at it cautiously and defensively. Try to see why it might not work. This is important because it highlights the weak points in a plan. It allows you to eliminate them, alter them, or prepare contingency plans to counter them. Black Hat thinking helps to make your plans 'tougher' and more resilient. It can also help you to spot fatal flaws and risks before you embark on a course of action. Black Hat thinking is one of the real benefits of this technique, as many successful people get so used to thinking positively that often they cannot see problems in advance. This leaves them under-prepared for difficulties.

The yellow hat helps you to think positively. It is the optimistic viewpoint that helps you to see all the benefits of the decision and the value in it. Yellow Hat thinking helps you to keep going when everything looks gloomy and difficult.

The Green Hat stands for creativity. This is where you can develop creative solutions to a problem. It is a freewheeling way of thinking, in which there is little criticism of ideas. A whole range of creativity tools can help you here.
This hat is so common to war on. It needs creativity that is also not extinct but uncommon as our corporate culture rarely encourages it.

The Blue Hat stands for process control. This is the hat worn by people chairing meetings. When running into difficulties because ideas are running dry, they may direct activity into Green Hat thinking. When contingency plans are needed, they will ask for Black Hat thinking, etc.

A variant of this technique is to look at problems from the point of view of different professionals (e.g. doctors, architects, sales directors, etc.) or different customers.

The directors of XYZ Company are looking at whether they should construct a new office building at prime location in the town. It is a huge project involving lot of time and cost. The economy is doing well, and the amount of vacant office space is reducing sharply. As part of their decision they decide to use the 6 Thinking Hats technique during a planning meeting. Looking at the problem with the White Hat, they analyze the data they have. They examine the trend in vacant office space, which shows a sharp reduction. They anticipate that by the time the office block would be completed, that there will be a severe shortage of office space. Current government projections show steady economic growth for at least the construction period. With Red Hat thinking, some of the directors think the proposed building looks quite ugly. While it would be highly cost-effective, they worry that people would not like to work in it.

When they think with the Black Hat, they worry that government projections may be wrong. The economy may be about to enter a 'cyclical downturn', in which case the office building may be empty for a long time. If the building is not attractive, then companies will choose to work in another better-looking building at the same rent. With the Yellow Hat, however, if the economy holds up and their projections are correct, the company stands to make a great deal of money. If they are lucky, maybe they could sell the building before the next downturn, or rent to tenants on long-term leases that will last through any recession. With Green Hat thinking they consider whether they should change the design to make the building more pleasant. Perhaps they could build prestige offices that people would want to rent in any economic climate. Alternatively, maybe they should invest the money in the short term to buy up property at a low cost when a recession comes. The Blue Hat has been used by the meeting's Chair to move between the different thinking styles. He or she may have needed to keep other members of the team from switching styles, or from criticizing other peoples' points.

It is well worth reading Edward de Bono's book 6 Thinking Hats for more information on this technique.

Six Thinking Hats is a very effective technique for looking at the effects of a decision from a number of different points of view. It allows necessary emotion and skepticism to be brought into what would otherwise be purely rational decisions. It opens up the opportunity for creativity within Decision Making. The technique also helps, for example, persistently pessimistic people to be positive and creative.
Plans developed using the Six Thinking Hats' technique will be sounder and more resilient than would otherwise be the case. It may also help you to avoid public relations mistakes, and spot good reasons not to follow a course of action before you have committed to it.

Now let us think that it is not limited to mega projects. Other decisions can also be considered with the help of this technique.
However, applying this tool to routine decisions is not advisable as it is too elaborate. Decisions that have ;on range impact and need thorough consideration e.g. launching a new product, opening a new branch, change in organization set up, mergers and the like are better targeted with is technique.

Find out a problem or situation currently at your desk awaiting a decision. Take time out to wear these hats one by one and go through the process to find out the efficacy of the suggested styles.





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