All entries for Saturday 13 April 2013
April 13, 2013
Another poor decision that is closely related to the marketing aspect that we covered in our presentation is the decision by the owners of M&M's and Mars to not let Steven Spielberg use their product in his famous film "ET The Extra-Terrestrial". By doing so, they missed out on a major marketing coup and instead the universal studios went to a competing candy manufacturer (Hershey's), who benefited significantly from having their product in the then top-grossing movie. Hershey's not only generated publicity but also tripled their sales. I don't know the particular reasons why the mars brothers rejected spielberg's approach, but they would have increased their chances of making the right call if only they had used some of the tools that we covered in RDM.
Other notable bad decisions include: Henry Ford's decision to stick with the Model T and not introducing a new car for years; and Ross Perot's decision to not agree to Bill gates pretty modest demand of 40 million dollars in return for Microsoft.
If nothing else, this indicates the huge importance of making robust decisions in the professional world. I have only used business examples, but it is clear that there are also other life decisions that we can certainly improve by minimizing our biases; by recognizing the presence of uncertainty; and by having a thorough decision-making process with appropriate tools.
The module on robust decision making has certainly increased my awareness, in terms of reflecting on some of the major decisions that are taken in this country and across the world. I now appreciate much more how one can increase the robustness of their decision. It is also very interesting to notice how people have made some bad decisions over the years and then work out what could I have done differently with the knowledge I have gained from RDM.
For example, let's consider Apple's decision to replace google maps(which had been very reliable). I think we can safely say that it was one of the worst decisions Apple has made in recent years. It probably indicates a case of egocentrism and ego based bias that we came across in the lectures. They could have made a better decision by having a well constructed decision process with tools such as trade off analysis and plus minus implications analysis.