All entries for March 2016
March 14, 2016
On the first day when we as a team were asked to make a decision about which place and marketing mode to choose for Sea Catch. I thought this would be an easy task. In my accountancy background in under graduate, I took lot of decisions based on financial terms and i thought this is the most effective way to develop better understanding of the circumstances. Main tools used in accountancy were payback period, Internal rate of return and then Net Present Value, if all are favourable then decision for most of the times used to be positive. I had never thought there can be something else apart from money which can help to develop better understanding to take quick and effective decision.
While working on our mini project we decided to agree on the understanding gained from the case. Because we thought that different people might have understood different things. Then after sharing our understanding, our team decided to explore all the decision making tools from literature and notes. Again we shared our understanding, in this process some points were overlooked by some team members but during session of exchanging understanding team reached a same understanding level of each tool. Then we decided to disintegrate decision making process between selection of location and marketing technique. Although they had a relationship but nature of decision was different. Then team highlighted some tools and after detailed discussion on their effectiveness to give better results for robust decision in this circumstances were evaluated. Like this our team finalised the tools to be used for both decisions.
We as a team decided to do cost benefit analysis, because i had done this many times. But what i was found in this exercise were we were going other way around. In accountancy we were given with basic values to calculate the total costs and revenues and then cost is deducted from revenuer, which gave us net benefit or loss. But here we have to judge or find the quantifiable values of benefits and cost on our own, which i realised was quite a challenging task. For the first time i realised how difficult it can be to do cost benefit analysis in real life. Due to its complexity and time constraint we had to drop this tool.
March 07, 2016
There are lot of theories developed on leadership, and over the period of time people have adopted different them as they believed that this will suit their circumstances and position to exercise them. Some theories states leader are born and other states they can be made through developing and training their skills, attributes and personalities. I believe both can happen. Some people are really born with extra ordinary skills and thinking style, which are new and different from others. They see what others can't see. But those things can be seen by others by improving their skills through educating and training them, to see the matters which are important for decision making. Its in hand of person to change himself. People do change, but the process of change from normal person to becoming a leader requires lot of efforts. That process can be putting that person into simulated environment to develop artificial stress and create near to realistic environment to make them strong psychologically and enable them to feel confident and take right decision in the circumstances, where no one knows what to do and their is no one who can help you with guaranteed right decision.
There is no doubt being leader is not an easy task. I believe leader must know all style of leaderships he should know how and when to become autocratic, democratic and lazies fare. One style of leadership can't fit all the circumstances. Leader can go through different circumstances and sensitivity of circumstances can differ as well. Its important for leader to access and understand the circumstances and then adopt the right leadership style. In some circumstance high skills and experience can be needed to overcome situation and no one is close to calibre of skills and qualities of leader, then leader must use his skills and experience to come up with solution. But in situation where leader is far from the problem its very important for leader to empower the people who are closer to that problem in terms of interaction and understanding, then in such case leader should let those people decide to solve their problem in to best of their understanding. In situations where brainstorming is needed to come up with new thoughts or to develop thoughts by exchanging ideas and developing a bigger idea on the basis of exchanging ideas with each other in organisation then leader can choose democratic approach.
But all these decisions can again differ in terms of intellectual quality of the people leader is dealing with. If those people are not highly skilled and don't know the bigger picture which organisation is trying to deal with or to achieve in the long run then involving them in the decision making process wouldn't be a nice choice. Even though great idea can come up from any part of organisation regardless of skills level. Intelligence have nothing to do with experience, skills and education. Its important for leader to understand and provide easy opportunity for people all around the organisation to easily share their ideas with higher level management, and those ideas should be evaluated while remaining unbiased. Leadership is as earlier said a complex role, which need to be understood and performed in a complex way, instead of taking generalised approach to minimise personal pain in short run but this will result in poor organisational results in long run.
March 06, 2016
Sometime we think we know something, but actually we don't. Sometimes we believe we had made a good decision but actually we haven't. Most of the times many people come up with quick answers, with the assumption that it was a right decision. According to research humans have two system which help them to make decisions. One is system one and another is system two. System one come up with faster answer, these answers are normally based on judgements, rumours or past experiences. This system most of the times overlook the tiny details of question and directly jumps to answer, which is often. Reason for wrong answer is that apparently question looks different but if details are understood that means something else and so is answer different. This system of thinking doesn't involve any process of thinking and concludes very quickly. System two uses a systematic way to reach answer, it starts to answer the question by applying some systematic model to question to fit in and develops answer with reason and justification. In this case chances of missing minor details are low and probability of making right decision is high. But people who are not habitual of using this process of decision making they normally don't use this system and rely mostly on system one.
Sometimes somethings seems simple, but they ain't. And sometimes too much time i spent on simple decision. Both systems can't be used all the time. Choosing which system to choose at which time depends on the circumstances. If circumstances require quick decision for example in case of disaster, unexpected emergency then using system two can waste time, because in such circumstances time is key to have impact. Greater the time it will take to respond, greater the impact will be. So for such circumstances system one is the most appropriate way of making decision. But in case where lot of factors are involved in decision making like making the decision to expand in particular market or not. In such circumstances there are lot factors which need to be analysed before reaching conclusion. In order to analyse different information's different business models can be used as a frame work to interpret the information and make a sensible meaning out of it. By using business models bigger picture is understood and after taking input from various business models a decision is made, with support of all the calculations. If in beginning, a right way of decision system have been selected for right circumstances then chances of making right decisions are also high.