All entries for March 2017
March 19, 2017
Implementing desicion making tools in a case study situation is not as easy as it might have seemed at the beginning. First of all, the contradictory data regarding dates and impossible deadlines for production start forced us to take some assumtions. Additionally we had in minds our first set of decisions - to continue the project and to manufacture in Lymington. How good were these decisions taken within half an hour on the basis of the wrong incomplete data? Are now biased towards this direction? We try to reset our minds and we will see next week, if the analysis we conduct will confirm them or will lead to different decisions. So where are we now?
While reading the text carefully, we discovered all the steps and nuances in the decision process which made a decision tree very expanded. One team member prepared an excel file with all the numbers which we will use for sure in the decision making process. We just need to add there reasonable assumptions about sales after 2022 and market conditions in 2018. It will be very helpful while calculating NPV for both investments (Lymington & Exmouth). Half of the team started preparing SWOT analysis of two possible locations, but so far we come to the conclusion that we need to do some more research about geography and demographics of the places. What seemed a not too complicated cost-benefit analysis at a very begining, has been growing into a major analysis which requires a set of few different decision making tools. I think it will be good to start next session with silent brainstorming and encourage everybody to be critical and express their opinions, in order to avoid groupthinking. During the coming days we need to collect all possible data, make as reliable as possible assumptions and finally make robust decisions for WaveRiders. I am looking forward to see the results of our and other groups work on Friday!
March 15, 2017
Robust Decision Making was a quite mysterious module title for me. It was clear what decision making is, but what does 'robust' mean? Well, it is all about analysing different possibilities and influencing factors, creating scenarios and choosing this alternative which is indifferent after small changes in the environment. For example if I take a credit in the same currency in which I earn money, it will be robust in comparison to taking a credit in a different currency (cause in case of a fluctuation in exchange rate, I will need to give back different amount of money than I borrowed).
I was surprised with the results of the test assessing our judgement - I had only 3 answers correct out of 12! It is scary to think how many wrong decision we make every day due to relying on our system 1 and falling into a trap of different heuristics. I was unaware how bad visual problems, quantitative judgement or logical judgement might be. I was falling into Gamblers Fallacy or recognized a pattern where there was any not a single time... So what can I do about disfunctions of our brain? How can I improve my decision making process?
Well, there are many tools we can use - MaxiMax, MaxiMin, Expected Value, Decision Tree. I have always liked the last one, as it clearly divides a complex decision into steps and assigns value and probability to each of it. I think it helps to structure the problem and I will try to use it to better understand the case of WaveRiders while preparing the presentation.
SMART, which stands for Simple Multiple Atribute Rating Technique, is another useful tool. As long as we can list the attributes, assign weight to them and rate each possibility against each attribute, SMART will help us to choose optimal option or at least eliminate the suboptimal ones. I think I could use it to choose a job if I had a few offers on the table, rating each option against attributes such as salary, career progression, training available, skills development, team or atmosphere in the office.
Despite abundance of decision making tools and techniques, following a good decision making process does not guarantee a good decision outcome. Even badly taken decisions can bring good outcomes. So what are our chances of getting good results? And even if a different decision could have brought better results, would we ever realise it?
March 08, 2017
Leadership is a function of a leader, group members and situation (Avolio, Bruce J., 2007; DuBrin, Andrew J., 2016). But shall the leader really be first in this equation? If leadership is about flexibility and adapting to circumstances in order to achieve common goal, shouldn't leader come as the last? In the sense that depending on a situation and what kind of people he/ she leads, the approach to group members, the approach to problem, the leadership style and ultimately the leader behaviour and strategy will differ.
Being a leader does not mean to stay at the top of the group, being passive and just giving orders. Being leader means to move all the time, from big picture to details and back, from individuals to group as a whole, from achieving a target to improving group morale, etc. We cant's stagnate, cause if we do we will stay behind.