Thinking, Creativity, Decision Making and Opportunity


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Thinking, creativity & decision making - slide showing how our cognitive system works, how we make decisions, and the concept and elements of creativity - with a focus on entreprenurial opportunity

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Thinking, Creativity, Decision Making and Opportunity

  1. 1. Thinking, Creativity, Decision Making & Opportunity Murray Hunter University Malaysia Perlis
  2. 2. Sensory Perception and Cognition
  3. 3. External Stimuli Perceptual Cognition Environmental energy Inputs Conversion of environmental energy to neural Overview of the Receptors Eye-electromagnetic energy, impulses photoreceptors (primary visual cognitive system cortex) Various parts of Ear-air waves, mechanoreceptors memory that (Auditory cortex) Sensory Store hold unanalyzed Tactile/haptic-tissue distortion, skin, receptor input. (somatosensory cortex) Tongue-aromatic chemicals, mechanoreceptors, (organoleptic and olfactory cortex) The attention Attentionmechanism selects and blocks Mechanism Visual/spatial, auditory, haptic, perceptual olfactory, organoleptic and information for motoristicpattern recognition. Pattern Recognition Recognizes and determines which Also includes information a smell, taste and person will use and Visual Phonological sensations. remember. Perception Selection Where information is patterned recognition and and sequences in a way our mind interpretation. self organizes. Patterning Bias A working limited capacity memory carrying out the functions of rehearsal, coding, decisions and strategies. Temporary Mental Cognition Decision Psychotic, Working (Short Output MakingBehavioral and Term) Memory Responses Processes Cognitive Distortion Long term storage memory Heuristics, Long Term where short term memory biases and retrieves and deposits Memory other information. influencingmechanisms. (Arrows represent neural transmissions)
  4. 4. Our cognitive system canonly process one thing at a time
  5. 5. Please say the colours Yellow Blue Orange Black Red Green Purple Yellow Red Orange Green Black Blue Red Purple Green Blue Orange An example of cognitive confusion
  6. 6. “Run Throughs” Fix Start Blocks Change shoes Jogging Our memoryand knowledge Fast sprints Size up competitors makes up a Warm up schema Practice starts Pre-Start Stretching Call up Take off Relax track suit Running a 100m race Wait for Dip at line Stand behind call up blocks Final acceleration Slow Attention to finish line down Get on marks Whistle Race Call to marks Accelerate hard Start first part Call to setThese are linked Run relax and coastto our emotions ‘Explode off Gun Set position blocks’
  7. 7. Learning & Learning New Experience schemamodificationPresent feelings & New feelings & emotions emotions Created Interpretation Experience unableExisting Schema to coordinate new Modified Schema experience with(Prior Knowledge) existing schema Use of metaphor to understand and solve problems If solved will lead to reinforcement of existing schema Time
  8. 8. Problem Solving and Decision Making
  9. 9. The primary objective of reasoning, problem solving and decision making is to find ways out of difficulties, achieve aims or objectives, make a selection or overcome some form of obstacle. Decision making requires special sets of skills, which not only set us apart from the animal kingdom but also set human apart from human. In his book Sources of Power: How People makeDecisions, Gary Klein (1998) goes further andstates that decision making skills are a source of power for an individual.
  10. 10. Please construct 4 equilateral trianglesconstructed with 6 matches without any matches crossing
  11. 11. To discover the correct arrangement of objectsmay require a flash of insight to discover theright combination of sequence. This maysometimes occur after a number of attempts toarrange and rearrange the objects through ‘trialand error’. The necessary arrangement orsequence of items to solve the puzzle orproblem may only be discovered after a numberof attempts to find the correct sequence
  12. 12. Shows how we need to change our patterning – 2D to 3D to solve the problem
  13. 13. This was demonstrated well in a sequence of the film Apollo 13, directed by RonHoward. The level of oxygen was rapidly declining in the lunar module of the ill-fated Apollo 13 mission, so a solution was needed to maintain adequate filtering ofthe air to rid it of CO2 build up. The technical team in Houston was given theproblem of finding …”a way to make this (a square air scrubber filter from thecommand module) fit into a hole like this (the shape of a round air scrubber filter inthe lunar module) using nothing but that (items that are available to the astronautsin either the command or lunar module). This problem could only be solved throughtrial and error until a solution was found.
  14. 14. Simple Decision making strategiesThe Attribute Rating Totals of the two cars Car 1 Car 2Cost +2 +1Power +1 +2Economy +1 -1Comfort +2 +2Total +6 +4
  15. 15. Difference in the Scores of Each Attribute of the Two Cars Car 1 Car 2 DifferenceCost +2 +1 +1Power +1 +2 -1Economy +1 -1 +2Comfort +2 +2 0Total +6 +4 +2 Our intuition will often override attribute scoring
  16. 16. Finding a segment for a shampoo
  17. 17. D GAttribute 2 Attribute 2 F C E I H A B Attribute 3 A B C D Attribute 1 Attribute 1Figure 4.19. Two-dimension and three-dimension grids or matrixes.
  18. 18. Selection of different market levels High Active Concentration Medium Active Concentration Highly Low Active Fragranced Concentration Organically Produced Conditioner Conditions Conditions Shampoo Various All Hair Selection of two completely different Selection of different market marketing strategies segments
  19. 19. Intuition plays a major role in opportunity identification Degree of ambiguity Active/Imaginative Allocative Construction Intuitive Analytical Supply/Demand changes New technologies Demographic changes New Business models Value creation n io v at no Locus of change In Inductive Imitation Discovery Deductive Replication & Extension Incongruities (Black & white) Structural changesPassive/Reactive The range of entrepreneurial opportunities
  20. 20. Images and Connections Vision Platform - PerceptionThe cognitive process behind the Time & Space Potential conceptualization of Concept Generator – ideas Making Connections Concepts Learning: Conceptual World Real World Sources of Opportunity Identifying Experimentation concepts & Testing Evaluation after experience “A Narrative” Ideas Complete re- evaluation (seek further information) Structure common to all Evaluated and opportunities Elaborated Upon Vision – Outcomes Time & Space Opportunity Resources Networks Skills, Competencies & Capabilities Competitive Environment Strategy – scope & depth
  21. 21. SinglePerspective Being able to switch from view to view to see the object, person or event from multiple perspectives
  22. 22. Complex Problems like agriculture & engineering
  23. 23. Location Climate Genetic Material Humidity Collection Temperature Purchase Sunshine hoursTopography UV radiation Plant physiology Seasons Slope & drainage Propagation Yield and Rainfall characteristics Chemical Constituents of the Humus Nutrients Method of extraction Essential Oil Extraction time Compactness Drainage & water holding qualities Pest & weed pH control Pre-harvest handlingMineral residuals Irrigation & preparation Plant densities Soil type Time & method of harvest Agronomic Harvest & Soil Practices Extraction Practices
  24. 24. More Complex Problems
  25. 25. Complex decisions in relation to potential opportunities and suitable strategiescannot be explained by simple models. These types of decisions aremultiple, sequential and must be decided in a flexible manner to suit differentsituations within an overall changing environment. The characteristic environmentwhere these decisions are made will be;•Related to ill-defined and ill-structured problems where a lot of effort has to be madeto understand what is happening.•In a dynamic environment under situations of uncertainty where information will beincomplete and ambiguous.•Where there are multiple players within the environment, whose actions andreactions are not always known.•Where objectives may shift during evaluation periods and during strategy execution.•Where strategy and work within the environment is complex and requires a highamount of coordination.•Where relationships between variable is not fully clear and these relationship caneven change over time.•Where there is considerable time pressure where stress exists.•There are costs involved with failure, and•Where both organizational and personal goals are a guide to the direction decisionmaking will go.
  26. 26. Demographics The ever changing environment Technology Shock Competitor’s new products Change New New Merging Opportunities Information IndustriesLifestyle Economy Gestalt Changing Tastes Regulation
  27. 27. Inputs Culture (the way of doing things) Input NewResearch Ideas Technology Excitement New ChangingFood Producers The supply Retailers products demands chain Sustainability Ethics Logistic science Finance Lifestyle & Houses values Skills/capabilities Underlying costs Retail practices Supply Demand Push Pull
  28. 28. Why do companiesneed Innovation?
  29. 29. Products more than 5 years old usually don’t make majorcontributions to a company’s revenue •Technology •Consumer style change
  30. 30. Product EvolutionPre 1900’s Laundry BlueUp to Late 1940’s Solid Soaps & Powders Laundry Detergent Bars1950’s until present Laundry Detergents Powders Laundry Detergents with Liquids Special Detergents Additives Concentrated1980’s until present Laundry Powders Laundry Detergent Tablets
  31. 31. Evolution Verses Revolution Changing Technology (slow to Change) Changing Lifestyles Cheap Clothes Available (substitute) Had to Reinvent the Company due to Slow Product Development
  32. 32. The Evolution of Fashion
  33. 33. 1800s
  34. 34. 1930s
  35. 35. 1950s
  36. 36. 1960s
  37. 37. 1970s
  38. 38. 1980s
  39. 39. 1990s
  40. 40. 2006
  41. 41. Thai Hong Kong MalayFashion Fashion Fashion Geographical as well as time differences in fashion
  42. 42. Technology/Market Positioning Hotel Coffee Shop Coffee Bean HighStyle Kedai Kopi Fast Food Low Low High Technology
  43. 43. New Economic PollutionParadigms Growth Fossil Fuels Export/Import Transport Farm Raw materials Transport Government Power Production Transport Diversity generation Warehouse Management Supermarket Conflict Research & Community Development Consumption Education Regulation Competition & Tension Air Transport Poverty & Unhappiness Development Waste Health Uncertainty A simplified environment
  44. 44. Any environment has the following factors;•A field,•Objects within the field,•Relationships between objects,•Actors,•Relationships between actors,•Events,•Relationships between events,•Relationships between actors and events,•Relationships between actors and objects,•Relationships between actors, objects and the field,•Relationships (or no relationships) between everything,•The situation,•Movements and stillness,•motives,•relationship between self and the actors, objects and the field, and•Interpretations of the above.
  45. 45. The generic problem solving process Problem Problem Implementation The Identification Resolution & StrategyEnvironment“The Mess” Data Ideation Elaboration Set of sub- Gathering & Extensionenvironments Return to ideation to refine detail to complete concept Objective Data Subjective Data Each step requires: Followed By: Another problem Feeling & Intuition Divergent Thinking Convergent Thinking in itself to open up the issues to focus on the issues
  46. 46. Cognitive Tools Personal Desires The ongoing story construct Perceptual BiasesEnvironmental Potential Scenarios 1 Information Narrative 2 3 Prior Knowledge 4 Concept + + Organizational Goals Visual Spatial Consistent with personal and organizational goals, New in accordance with prior knowledge, enhanced Knowledge Developed Idea with new knowledge and developed and verified with various cognitive tools.
  47. 47. MemoryTruth Beliefs Knowledge
  48. 48. Predicting the future
  49. 49. Present time The PastWe know the past and present Without any changes our timeline will remain relatively unaltered
  50. 50. Present timeThe Past 2 in 1 shampoo This changes the creates a new parallel of the market segment market gradually The effect of competitor innovation will bring product evolution
  51. 51. Present time The Past A Radical change in technology Will radically change the timeline into aThe advent of mobile phones new industry
  52. 52. Consumers Positioning Potential new novel Opportunity product extending market field or creating a new oneAttempting through existing or to create Targeting new channels and Refining thesome form business models. Idea ofcompetitive advantage Segmentation Concept Product idea to compete with Market existing products in market Identification The set of possible ideas/products/markets The Causation Process The Effectuation Process
  53. 53. Existing Products New ProductsExisting CausationMarkets New EffectuationMarkets
  54. 54. Developing a Central Theme into an Implementable Strategy. Brand Signal Features Benefits Channels Theme Attributes Strategy Characteristics Central Theme Organically produced high active (Product Proposition) concentration shampoo with product variants to suit various conditions. Underlying High & discerning Low Assumptions Rapidly growing market end. competition segment. Customers who in segment. want mass custom produced products. Sustainable Products match personal values.
  55. 55. Opportunity Shift Time Newly identified opportunity needing different goals, An identified strategies,opportunity in competencies, skills, the past resources and organization than previously The Opportunity Landscape What strategies are required to successfully Present Needed exploit the new Strategies Realignment of Strategies Strategies opportunity and meet the organizations new goals? Competitiveness What type of organization and Present Needed business model is Organization Realignment of Organization Organization needed to support the selected strategy? What skills, competencies and Present Skills & Needed Skills & technologies are Realignment of Skills & Competencies needed to support the Competencies Competencies new business model and strategy? What resources are needed to support Present Needed Realignment of Resources skills, competencies, Resources Resources technologies, new business model and strategy? What networks are Present Needed needed to exploit the Networks Realignment of Networks Networks opportunity, acquires skills, technologies and resources, support the new business model and strategy? What new goals are Present Goals New Goals Setting of New goals needed to exploit the newly identified opportunity? Reengineering of Total Organization
  56. 56. Product Reengineering Process (Process for FMCG Product) Product from Market Step 1: Examination of the product to determine characteristics. a) What type of process was it manufactured by? b) What would be its formulation/recipe? C) What materials are used in its manufacture? Step 2: Develop a full Product Technical & technical specification for Market Specifications the product and production process. Probable Product Production Process Step 3: Include any improvements to the product Laboratory Development Step 4: Laboratory & Production Trials development of formulation/recipe and Return to lab. For any development of modifications production process Product Trials (Both consumer use & Step 5: Undertake production) consumer product testing and production trials Completed Product
  57. 57. C Constructed Concept Concept Extraction Charcoal Burger GrillA (location) + B (characteristics) 1. Location near young people = C (constructed Concept) (university): convenient 2. Cheap and affordable University 3. Good service 4. Authentic charcoal BBQ burger grill (western style) 5. Convenient meeting placeA with WiFi etc. Location Fastfood B Concept Extraction (General Characteristics) 1. Cheap 2. Good standard of hygiene 3. Good service 4. Fast and efficient 5. Specialize in a particular food 6. Know what to expect 7. A meeting place for people Potential success parameters
  58. 58. GroupthinkJanis (1972) postulated that the symptoms of groupthink are;The illusion of invulnerability which creates over optimism of potential success andwillingness to take high risks,An inherent belief of their own morality where the consequences of their decisionsare ignored,Collective rationalization where warnings, signs and messages are rationalizedaccording to existing group assumptions,Negatively generalized and stereotyped views of external people and entities,where they view others as weak and foolish,Self censorship and pressure on dissenters to carry the group line and not expressany disagreements, including the suppression of outside views disagreeing withthe group,The illusion of unanimity in the belief that individual views conform to the majorityview and silence means consent,Social pressure on those who have doubts about group consensus, andThere are self appointed ‘mind-guards’ to protect the leader and group frominformation that may threaten any potential group cohesiveness.Kowert (2002) also added that an overload of information mayalso contribute to causing the groupthink phenomena.
  59. 59. Antecedents Observable Consequences Defective decision Decision makers are a 1. cohesive group Symptoms of groupthink making Organizational Overestimation Incomplete survey Structural Faults Vulnerability of alternatives. Insulation of group – illusion of Incomplete survey Low probability of successful outcome Lack of leader invulnerability of objectives. impartiality - Belief in inherent Failure to examine Lack of procedural morality of group risks of preferred methodology Closed Mindedness choice. Social homogeneity of - Collective Concurrence- Failure to reappraise members rationalization seeking initially rejected - Stereotyping of tendency in alternatives. outsiders group Poor information Pressures toward Provocative search. conformity Situational Context Selective bias in - Self censorship High stress from processing. - Illusion of external threat information at Unanimity Low self esteem hand. - Direct pressure on induced from recent Failure to develop dissentersfailures, difficulties in contingency plans - self appointed current decision mindguards making that lower members sense of self efficacy. Moral dilemmasThe Groupthink Process
  60. 60. Influence of cognitive rigidity on firm Level of Innovation Optimal level of Innovation “Hierarchy” “Anarchy” Too unstructured Too rigid to to turn creativity be creative into innovation Level of creativityChannelling of information Need to know basis Relevant information available to who needs it Too much incoming informationDegree of internal Strictly hierarchical Connections occur where relevant Ungoverned connectionsand external connectionsDispersal of power Hierarchical According to knowhow & expertise No fixed determinationDegree of diversity Conforming membership Diverse membership Diverse membershipLevels of stress and High stress & anxiety Stress & anxiety minimized High stress & anxiety
  61. 61. Experience Attribute SubstitutionIncreasing Availability Word of Heuristics Mouth Media Reports Fallacies Intuition Misconceptions Data Potential Creativity Information Abstract Process Inferences (Circumvents knowledge logic & perception) Faulty or invalid premises Cognitive Wisdom Biases Ideas Decision Reasoning Making Strategy Factors influencing thinking Increasing Usefulness
  62. 62. Self ConfidenceThe way our imagination develops ideas,motivation and determination Belief in success Determine Familiarity any future Emotions action Motivation (goals & objectives) Vague Aspirations A Desirable future Determination Imagination Image Concept Idea (conceptions) (vision) (Framing/reframing) Stimulation Effectuation Retrieval Mental imagery, Construction, Create new schema, Metaphor, Comes as Analogy, Seeing something in Mixed Reality & Fantasy memories, beliefs, new way, Connecting unrelated assumptions, concepts (pictorial & haptic processes) emotions Memories Perceptual experiences
  63. 63. Creativity Tool Cognitive Skill Knowledge (vocabulary) of odorous substances Imagination Olfactory sensitivity Knowledge of potential strengths, weaknesses and applications of odorous materials Knowledge of Curiosity, enquiry outstanding and Perfumer fragrance creations experimentation Excellence within the domain Practical knowledge & experience Process & Interest and Product passion Time, patience, perseverance Factors influencing creativity EmotionKnowledge Base
  64. 64. Elements of creativity Perception Attenuation Mental Maps Knowledge Attention Prior Knowledge Expertise Heuristics Technical Knowledge Practical Knowledge Unconscious CreativeIntellectual Knowledge Cognitive Thinking Skills Creativity Tacit Knowledge Processing Experience Assumptions, Beliefs, Values Motivation Ego Sensitivity Energy Motivational Trigger Curiosity Emotion The Environment
  65. 65. Increase of energyNegative Energy Positive EnergyLow self Esteem Excitement Anxiety “Worthlessness Gravity” “Belief in Success Gravity” Sense of Challenge Feeling of Passion Powerlessness Things not going well Moving forward towards success Assumption of Where we are now “worthlessness” “Tension” Person’s “Vision” The Forces of the Motivational Trigger.
  66. 66. Curiosity Insight Exploration Security & Discovery Purpose Openness toWisdom Learning Confidence/ Excitement Self Esteem Obsessive Passion for Persistence the domain New Skills Dedication Mastery The path to wisdom and insight
  67. 67. Personality Situation/Life ExperienceSense and view of theworld & realityInner drive- aggressive/destructive- sensitive/appreciative Filter ExternalObtainment strategies Ego Mechanism StimuliLibidinal love for outsideworld/internal world ConceptSelf confidenceResponsibility InfluencesAccountability AttentionDrive/Courage Capacity to Synthesize Discipline Motivation Feelings & Defense Thoughts Emotions Mechanisms Desires The role of ego in thinking
  68. 68. Puzzling situation, curiosity, questioning of something given or problem in the Some parts of the elaboration process environment. require further creativity like strategy development.The creative Engagement process Opportunity Insight Preparation Period Incubation Frustration Period Period This may be a process The Creative of creating a number of Insight innovations so the idea will be able to be exploited as an opportunity. Verification Elaboration Period Period If flaws found with the insight, there may be a return to frustration, If no flaws in insight found there will preparation or incubation again. In be an advance to the elaboration Solution, concept, some cases there may be a period where the insight is developed idea and eventual questioning of engagement. into a concept, idea and eventually opportunity into a potential opportunity
  69. 69. Stimulation from the The incubation process environment through our sensory systems Insight Short Term Memory (STM) Sub-Consciousness Imagination Long Term Memory Self Organizing System Sub-consciousoperation creating free associations from bitsof random information Coded Domain Prior Knowledge Domains become more Imagery,fluid and flexible allowing Semantics & for analogies Syntax Still following patterns from learning
  70. 70. New Ideas Unknown OpportunitiesA metaphoric concept of Developing Strategies Surrounding creative intelligence Environment Solving Problems “Domain” &“Field” Environmental Environmental Factors conducive Factors that to creativity hinder creativity Internal Influencing Perception Factors Motivational Focus & Attention Trigger Creative Sensitivity Patterning Energy Emotion Thinking Curiosity Processes Prior Empathy (Self Organizing Knowledge Patterned Thinking Confidence System) Processes Discipline Interest Passion Cognitive Thinking Tools & Styles Memory Heuristics Belief Imagination Applied Thinking Fantasy Tools, Domain & Field Experience Manifestations & Acceptance/ Tacit Knowledge Elaborations Rejection Creative Product
  71. 71. Positive Optimum level of emotions for creativity Self-actualization/spirituality Concern & compassion Service to others Self Mastery The optimal Power within motivation Exploration & improvement area Self assertion & power over others Anger Greed & Craving Fear Anguish Apathy Guilt & shameNegative