Models for Decision Making

By on May 2, 2016 in Tutorials
Models for Decision Making

Have you ever been faced with a simple or complicated problem, and you didn't know where to being with the decision making process? I have often found that there are a variety of factors that cloud my ability to properly make decisions. Making decisions is often more complicated then we truly believe it to be because we often don't consider the side effects or consequences of our actions. Stress, emotions, personal feelings, bias, and the events of the day can all impact our ability to make informed and positive choices.

 

SaveSome decisions appear to be relatively straight forward until you take a step back and look at the entire picture with a fresh perspective. You may notice that there are a variety of factors that actually impact a choice or decision that you did not notice before. If you're having trouble making a decision try some of the following solution decision making models and solutions:

 

Brainstorm

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One of the best ways to make decisions is to get a piece of paper and start jotting down ideas. Start writing down anything you think of whether or not it's a solution to the problem. Brainstorming is simply a way to get the ideas flowing, and start thinking through the decision you have to make.

  • What is the decision?
  • What are the components of the decision?
  • How complex is the decision?
  • What will effect your decision?
  • Is anyone else involved in the decision making process?
  • What are the possible solutions?
  • What are the possible side effects?
  • What are the possible consequences?
  • What is the ideal result?

 

Prioritize with the Pareto Analysis

The method of Pareto Analysis is often referred to as the 80/20 rule. That is to say, 20% of the work generates 80% of the results. Basically, this means that most of the work is not actually involved in the actual results.

I found a useful site that provided the following examples of the 80/20 rule:

  • " 20% of your products or services account for 80% of your profit"
  • " 80% of customer complaints arise from 20% of your products or services"
  • " 80% of delays in schedule arise from 20% of the possible causes of the delays"

There are a few simple steps to starting a Pareto Analysis for a choice, decision, or situation, and these are supposed to help you solve your problem. If you figure out the 20% of the causes you can solve % of the problems.

  • Identify and list all the problems involve in the decision
  • Identify the cause of each of the problems
  • Score each problem based on their importance or how much they impact the situation
  • Group problems together by their root causes
  • Add up the scores for each group - the group with the highest score should have the highest priority to resolve
  • Take action on each of these problems

I found a great example of creating a list based on Pareto analysis from mindtools.com: Here we see that someone has written down the problem, the cause of the problem, and how many people rank that as an important problem. By looking at the number of complaints for a given problem, we can figure out which problem ranks as the highest priority.

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Make Your Decision Based on Ratios

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Sometimes the easiest way to solve a problem or make a decision is to weigh two opposite sides of a coin. All you have to do is take a piece of paper and draw a vertical line down the center and start making a series of bullet points.

  • Make a Pro/Con List
  • Construct a Cost/Benefit Analysis
  • Compare the Risks and Rewards

These three types of ratio lists can help you weight the opposite sides of any decision. If the risks outweigh the rewards of a certain decision, maybe you should reconsider the decision itself or look for an alternative solution.

 

Utilize the Vroom-Yetton-Jago Decision Making Model

The Vroom-Yetton-Jago decision making model is a tool that helps a person determine what leadership style to use based on your current situation. The idea is that you ask yourself a series of questions about the problem, decision, side effects, and consequences to decide on how you approach the situation. Use this model if you're trying to make a decision for your company, team, at your job, or in any situation that effects multiple people.

According to this model there are three types of decision making styles:

  • Autocratic: you make a decision without the involvement of others, and then you inform others of your decision. An autocratic decision maker can be broken up into two types: A1, a person who uses information they already have to make a decision, and A2, you ask others for information to help you make a decision and then you make the decision yourself. For the most part, an autocratic decision maker does not inform those around them of the decision they are trying to make, even if they are getting information from those individuals to make their decision.
  • Consultative: this decision making style involves gathering information from your team and then making a decision. A consultative decision maker does their best to involve others in the decision making process. There are two types of consultative decision makers: C1, this person involves others in the decision making process, but ultimately the individual makes the final decision, and C2, this person, although responsible for making the decision, discusses the decision with others and asks for suggestions.
  • Collaborative: this decision making style is based on the work of a group. Here you and a group of people or another individual makes a decision together.

In order to determine which of these styles fits best for your current situation, you should ask yourself the following questions:

  • Are the consequences of a failed decision extremely significant?
  • Does a successful outcome depend on the help of others?
  • Do you have enough information to make a decision on your own?
  • Is the problem well structure that you can easily understand?
  • What constitutes a good solution?
  • Will the people you work with accept any decision that you make?
  • Will there be conflict in your workplace about the proper solution?
  • Does your company or team have a pre-set method or model for decision making?

You can use the figure below to help you best determine which decision making style to utilize for your situation.

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Create a Decision Tree

Decision trees are relatively simple and easy to interpret, which is why they are a popular and frequently used tool. A decision tree is basically a graph that branches out and shoes the different possibilities of events, side effects or consequences. Sometimes people attribute probabilities to certain outcomes to mathematically determine the most likely outcome or scenario, but you don't have to make it that complicated.

A decision tree can be as simple as the one featured below, where the different options are mapped out along with the reasons behind taking certain actions.

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Now, Make a Decision

At some point you're just going to have to make a decision and see how that decision pans out. All you can do is make the best decision possible with the information you've been given, and then stick to your guns. There is no way to completely predict the outcome of every action or decision. So, you just have to make that decision and then deal with the side effects, consequences, and results as they happen. If things don't pan out in a way that you would have hoped, then you just have to use it as a learning experience. You can't feel bad about your choices if you've truly taken the time to think through the choice you're about to make.

 

Reflect on Your Choices

After every decision or choice you've made, it's important to take time out to reflect on your choices. If something didn't pan out the way you wanted, try thinking about these key ideas:

  • How could you have changed your decision making model?
  • Is there really anything you could have done to change the outcome of the situation?
  • Why did thing not go according to plan?
  • What could have been done better?
  • What do you take away from this?
  • How does this change things?
  • How will you make decisions next time?

 

The Final Word

Ultimately, there is only so much you can do whenever it comes to making tough decisions or simple decisions. At a certain point you just have to get ready to take the plunge, and go for it. After you've made the decision, it's time to deal with the effects and just take it from there. You can't do a whole lot more except wait and see what happens, and learn from it the next time around.

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