1.1 Decision Making and Problem Solving in Organizations

Welcome to Problem Solving and Decision Making brought to you by the University of California, Irvine. I’m Rob Stone, I’ve been doing problem solving and decision making my whole life just like all the rest of you. We all do that on a daily basis, we constantly do this. We do it well, we do it not so well but we’re always doing it. I’ve also been doing this in my professional life for a number of years, how many we’ll not actually point out but a number of years in many organizations. I’ve worked with for profit organizations not for profit organizations, the government organizations. We’re going to, in this class talk about some of the tools, techniques, methods, processes that can help with problem solving and decision making. I’ve applied those in organizations that made decisions myself in various organizations, helped other people make decisions, helped teams make decisions. So we’ll be working with some of the things that help us do that. So let’s take a look at some of the concepts involved with problem solving and decision making. We’re going to talk about problem solving and decision making in organizations. This is module one, lecture one. A decision, it’s a choice. So we have to make a choice. It’s what decision making is all about, choosing. And the decision making part of it is a process, so there’s some steps you can go through or we’ll look at another way. You don’t have to go through specific steps some people just somehow make decisions along the way. This is a logical choice from available options so this is a little biased because it’s from a business dictionary and it implies that we’re going to make good decisions. We don’t have to make good decisions we can make bad decisions as well but hopefully we’ll make good decisions. We can make a bad choice or no choice and then we’ll talk about making good choices along the way, as well. We may have option one and option two. A bad choice would be to look at those and not think about them and just pick one. An example of that, there was a person who needed to hire a new staff member in their department. This person that was going to do the hiring was the, the head of that whole department, the final decision maker, the authority and everything. They put together a team of people to help in the hiring process and they got this group of people to interview different candidates and put recommendations together. There were list of prioritized people that this group came back with to this final authority, the final decision-maker. And then, this final decision-maker looked at the list and said, I don’t need this and threw it away. So, if they had a choice between person one and person two, how are they going to make that choice? What they did was they said I’m just going to pick that person over there because they speak Italian. Speaking Italian had nothing to do with working in this organization. Team work, understanding various word processes, being able to work with customers, those were all key skills and the person who was hired had none of those. So when we’re looking at some of the choices we make if we don’t think through these we might make a bad choice, that was a terrible choice. Another thing we can do is say option one, option two or no choice at all. When they say that at a certain point, something will happen. Either option one is going to take place or option two will take place I really don’t know what to do and I don’t really wanna make a decision. So I think I’ll just let things go on their own and see what happens and make no choice at all. So actually you are making a choice which ever one is the strongest and is the one that’s going to actually become the end result is your choice. You decided not to do anything, therefore something’s going to happen and it may not be the best thing. Let’s look at how we might decide to paint new cars. So we have choice one and choice two for paining new cars. One organization did a great job be, between choice one and choice two, option one and option two. We had a group of engineers, two groups of engineers. One group of engineers says, this is the best way to paint these new cars. Another group of engineers says, this is the best way to paint these new cars. The CEO of this car company, all of you know this car company, many of you have cars made by this company. The CEO finally had to make the decision because the engineers were just like this, they couldn’t make the decision of choice one,or choice two. Nobody else could figure out how to make this choice they went to the CEO. Both groups of engineers put together great logical arguments on why the CEO should pick this way to paint the cars instead of this way to paint the cars. The CEO surprised them, got all the engineers together and said okay let’s figure out how we’re going to paint the cars. Said I just have one question for each group. Please tell me which method of painting these cars will not work? And all of the engineers in unison said, well both ways work just fine. He said, choice two, option two that’s the way we’re gonna paint them and left. Perfectly good information to make a good decision. Both of them worked fine. Didn’t really make any difference which way it went. It’s not what the engineers were expecting for evaluation but it worked out fine. Method A, method B, let’s just pick B. Decision Making, The Ultimate Guide. This is a text that you might wanna refer to and we’re gonna use some slides from this text along the way. There are three key elements in the process of making a decision. Know your purpose. Why are you even trying to make this decisions? What do you wanna get out of this decision? Sometimes we don’t have any idea why we’re even bothering. So what’s the purpose of this whole thing? Understand your biases. We all have some biases that we just carry around with us and we will tend to lean toward the ways we kind of like to do things that may not always be the best way to do things and consider different consequences. It’s easy to make a decision sometimes, like a New Year’s resolution and then not think about the consequences. Oh, you mean I have to do that I didn’t know that was involved. So we’ll talk a little bit about them. Let’s take a look at an example. You have a purpose, you wanna have $1 million in accessible assets before you retire. And that’s a number that’s not all that unattainable for most people that are under 30 years old. You can probably put that money away and reach that goal but you’re gonna have to do some things to make that happen. Understand your biases, legal considerations and ethical considerations. Legal considerations, there was a, famous series on recently called Breaking Bad, one teacher decided that they wanted to make more money. And so they decided the best way to do that was to do something illegal. So we may have some legal considerations, are we going to go that path? Hm, no, we’re just gonna go the normal path and amass our million dollars by retirement through normal means. Ethical considerations, sometimes we think about, are there some certain things I don’t wanna be involved with? Do I wanna be involved with companies that do chemical testing on animals? Do I wanna be involved with companies that make weapons for warfare? You know, there’s some different ethical considerations we might wanna make along the way and then that’ll, that’ll take some of our options away from us. Also, now we have our options left over we’re going to think through those. Consequences, what are some of the consequences of amassing this amount of money by retirement? Well, we just might have to keep our car a few extra years, you know, instead of getting a brand new car every three or four years. Well, now it’s maybe every eight or ten years. We might just buy a car that’s not the fanciest style right now but it gets us around just fine. A lot of cars last 250,000 miles easily these years or these days. So, we don’t have to get a new car all the time except for just a stylish reason. We might not purchase some fancy new item like we might not purchase some fancy new brand name, designer watch of some sort. We might not take a fancy vacation every year it might be every two or three years and then we can go on a nice vacation. We don’t have to cut out everything we’re going to do in our lives to get our goal of having a certain amount of money by the time we retire. But we may have to cut back on some things there are some consequences to what we’re doing. Problem, problem is a gap or it’s some kind of a change. There’s something not right in the way that we usually understand things. Look at an example of a problem. You’re gaining weight because you eat badly and you don’t exercise enough. Well, I don’t know how many of you have that problem but I have that problem from time to time, many of us do. The exercise method that you choose just doesn’t work well for you. If you decide that you wanna go run and you start running and you can get in usually three or four miles a week. And then you realize oh, that’s not enough to see any kind of, weight difference at all. I’m gonna have to run at least 25 miles a week, I don’t know how I’m gonna do that. I need to find a different way of exercising. Problem solving, process of working through all the details of a problem to reach some kind of solution. So it’s a process, problem solving is a process and we do that in a couple of different ways.