Robust DecisionsRobust Decisions
Transforming Business
Through Sound Decisions
Transforming Business
Through Sound Decisions
Why Is It Difficult to Make Good Decisions?
Why Is It Difficult to Make Good Decisions?
Uncertainty Increasing complexity Incomplete and evolving data Dynamic business conditions Organizational barriers Poorly understood
information Widely dispersed teams
Uncertainty Increasing complexity Incomplete and evolving data Dynamic business conditions Organizational barriers Poorly understood
information Widely dispersed teams
How Much Do Bad Decisions Cost?
How Much Do Bad Decisions Cost?
Lost Time Lost revenue Reduced productivity Low morale Lost market share Worse…?
Lost Time Lost revenue Reduced productivity Low morale Lost market share Worse…?
50% of Decisions Fail50% of Decisions Fail “Why Decisions Fail” Paul Nutt, 2002
400 decisions made by senior managers Half of these decisions failed Failure: The action taken was not in effect 2 years later
Three classes of “blunders” Two out of every three decisions were made with failure
prone practices. Premature commitments, jumping on first idea – a key cause
of failure People spend time and money on the wrong things
Many decisions are actually efforts to justify vs. evaluation to select the best possible alternative.
“Why Decisions Fail” Paul Nutt, 2002 400 decisions made by senior managers Half of these decisions failed Failure: The action taken was not in effect 2 years later
Three classes of “blunders” Two out of every three decisions were made with failure
prone practices. Premature commitments, jumping on first idea – a key cause
of failure People spend time and money on the wrong things
Many decisions are actually efforts to justify vs. evaluation to select the best possible alternative.
Decision Making ProcessesDecision Making Processes
Understand the Problem (Framing) Clarify the Issue Generate Alternatives Develop Criteria
Evaluate alternatives relative to the Criteria
Fuse evaluation results to develop decision measures
Stakeholders and decision-makers
Decide what to do next Work to gain consensus Reduce uncertainty Refine Criteria Refine Alternatives Choose an alternative and document the deliberation and decision
Move to next issue
Decisions are a process, not an event!
Pugh’s Method, Kepner Tregoe, Multi-Attribute Utility Theory (MAUT)Pugh’s Method, Kepner Tregoe, Multi-Attribute Utility Theory (MAUT)
“The Mechanical Design Process” 3rd edition, David G. Ullman, McGraw Hill, 2003
Decision matrix
Confidence vendor meets criterion5 = very high1 = very low
Alternatives
Wt. Vendor 1 Vendor 3 Vendor 4
Cr i
t e r i a
Cost .3 4 4 4
Response time .17 3 3 5
Training time .17 2 4 5
Ease of use .17 1 4 4
Strong team .1 3 4 2
Team experience .1 3 4 2
Total 1.0 16 23 22
Weighted total 2.8 3.8 3.9
Decision matrix, weaknesses
• Uncertainty not addressed
• Incomplete information excluded
• Evaluation results inconsistently represented
(How do numbers in the matrix tie to the qualitative and
quantitative evaluation results?)
• Little guidance on what-to-do-next
• Decision risk not represented
• Team members’ evaluations not combined
How Methods Fit into ProcessesHow Methods Fit into Processes
Evaluation• Simulation• Testing• Prior Knowledge• Opinion
Criteria• QFD -Quality Function
Deployment• Doors• Specs
Alternatives• TRIZ• Morphologies• Portfolios
Bayesian Team Support• Information fusion• What-to-do-next analysis• Satisfaction and risk analysis• Decision capture tool• Decision management platform
UncertainEvolvingIncompleteConflicting
UncertainEvolvingIncompleteConflicting
UncertainEvolvingIncompleteConflicting
A Well Managed Decision is RobustA Well Managed Decision is Robust
A robust decision: Looks good later Has customer and team buy-in Is as insensitive to uncertainties as possible Was made with known anticipated
satisfaction and risk
A robust decision: Looks good later Has customer and team buy-in Is as insensitive to uncertainties as possible Was made with known anticipated
satisfaction and risk
Decision Making w/ Decision Making w/
The Accord™ Decision Making software solution uniquely supports BTS by leveraging powerful mathematical algorithms that cannot be handled manually. Factors in both Quantitative and Qualitative input Displays results from each person’s point of view Calculates the Risks Identifies what steps might improve the decision
process
The Accord™ Decision Making software solution uniquely supports BTS by leveraging powerful mathematical algorithms that cannot be handled manually. Factors in both Quantitative and Qualitative input Displays results from each person’s point of view Calculates the Risks Identifies what steps might improve the decision
process
- One-screen
- Graphical Interface
- Provides structure
- Instant Feedback
- Problem visualization
- One-screen
- Graphical Interface
- Provides structure
- Instant Feedback
- Problem visualization
Use Scenario (Accord™ Network)Use Scenario (Accord™ Network)
Issue owner
Consultant, New York City
Analyst, London
Engineer, on site
1. Identify alternatives and criteria and saves them on the server database. Has administrative oversight/control
3. Interpret analysis results
2. Team evaluates information. Results saved to server database
4. Team refines information at owners’ request.Server
5. Report, document, and reuse results and process.
Database
1.
Decision Management application areasDecision Management application areas
• Concept Selection Concept Selection
• Product DevelopmentProduct Development
• Process DesignProcess Design
• Process ImprovementProcess Improvement
• Project ManagementProject Management
• IT Portfolio ManagementIT Portfolio Management
• Proposal EvaluationProposal Evaluation
• Business StrategyBusiness Strategy
• Hiring/Review ProcessHiring/Review Process
Decision Making at Boeing, Space and Communications
Division
Decision Making at Boeing, Space and Communications
Division Project Decision Needed: Select a Delta Rocket nozzle modification to propose in an uncertain environment.
Unrefined information: some even qualitative Conflicting information: evaluation and importance varies
across team members Evolving information: problem is changing with time Incomplete information: evaluation is incomplete
Project Decision Needed: Select a Delta Rocket nozzle modification to propose in an uncertain environment.
Unrefined information: some even qualitative Conflicting information: evaluation and importance varies
across team members Evolving information: problem is changing with time Incomplete information: evaluation is incomplete
Ability to manage uncertainty of knowledge Increases confidence in decisions Helps target areas for risk mitigation
Significant potential time saving due to lowering the risk of repeating a design cycle in the development process.
Ability to manage strong personalities Facilitates team consensus
Allows productive discussion of different views
Ability to manage uncertainty of knowledge Increases confidence in decisions Helps target areas for risk mitigation
Significant potential time saving due to lowering the risk of repeating a design cycle in the development process.
Ability to manage strong personalities Facilitates team consensus
Allows productive discussion of different views
Boeing’s Benefits
Who Can Benefit?Who Can Benefit?
Major (<1000 employee) organizations
Geographically dispersed teams Highly competitive and fast
moving industries Mid-to-senior managers in those
organizations making mission-critical decisions
Major (<1000 employee) organizations
Geographically dispersed teams Highly competitive and fast
moving industries Mid-to-senior managers in those
organizations making mission-critical decisions
How Will They Benefit?How Will They Benefit?
Improve your teams’ performance Manage organizational uncertainty and doubt Empower the decision makers in the
organization Transform difficult processes into
well-structured Re-use, review of
decisions Build accountability
Improve your teams’ performance Manage organizational uncertainty and doubt Empower the decision makers in the
organization Transform difficult processes into
well-structured Re-use, review of
decisions Build accountability
How Do I Find Out More?How Do I Find Out More?
Visit: www.robustdecisions.com Contact: Tom Satterley 215-396-7332 Arrange for a Consultation/Demo Try Accord for 30 days with no risk
Visit: www.robustdecisions.com Contact: Tom Satterley 215-396-7332 Arrange for a Consultation/Demo Try Accord for 30 days with no risk