The document summarizes a presentation given to senior executives on decision making. It discusses how decision making is an important process that impacts organizations but is often not given careful thought. It outlines different types of decisions and models of decision making. It also presents a six step process for managerial decision making and emphasizes that properly defining the problem is the most important first step. Mathematical tools can help but qualitative approaches are better able to define problems and alternatives. The presentation aims to develop an effective "Super Strategy" approach to decision making.

1. Presentation made at the “”Workshop on Decision
Making” for Senior Executives of private Sector by
Maxwell Ranasinghe
at Hilton Colombo on 18th August 2012

2.  How often do you think
about how you think?
 For most people, the
answer is "not very often".
 Yet every day we each
make decisions, generate
ideas, draw conclusions,
evaluate other people's
opinions and so on.
 These are things that often
need careful thought.

3.  Where you are now is a result of the
decisions that you have made in the past.
 As such current status of every organization
is also a result of the decisions made by its
top executives to other decision makers
down the line.
 So all of us are decision makers

4.  Decision making is the process of identifying
problems and opportunities and resolving them.
 Decision making is not easy.
 It has to be done in an ever changing environment.
 Decisions range from strategic level decisions to day to
day operational level decisions.
 But we do not put effort to learn skills in decision
making.

5.  Business world is full of good and bad decisions.
 Every one here has made good decision and bad
decisions including me.
 Please write down some of your own good and bad
decisions in business
 Why it was good or why it was bad
 What are the methods you used taking such decisions

6.  Can we improve our decisions ?
 Yes you can
 I have helped many to take better decisions.
 I have taught so many students about this subject and
they are now employed in companies.
 The super strategy we are going to learn today have
helped a lot.

7.  Before developing a super strategy, lets see the
decision making landscape in organisations

8. Management decisions typically fall into
one of the two types of categories.
 Programmed Decisions - are made in response
for recurring organizational problems.
 How such decisions should be taken is formulated
well in advance and managers, subordinates and
others can take decisions as per the laid down
procedure.
 E.g. buying a computers, stationery, raw materials,
transporting products, hiring and firing certain
categories of employees

9.  Non programmed decisions – are made in response for
situations that are non recurring unique and have
important consequences for the organization.
 Many non programmed decisions involve strategic
planning, as uncertainty is great and problems are
complex.
 E.g. building a new factory, closing down operations of
a section, undertaking a major exploration, joining a
research consortium, manufacturing or out sourcing,
merging or take over issue, diversification, going into
new markets, product crisis etc.

10. Uncertainty and certainty
 In a perfect world, managers would have all the
necessary information to make decisions.
 In real world, you do not find everything that is
needed to take a decision.
 In practice, if you strive hard you will be able to find
most of the information that are existing, but to take a
decision you need to know what would happen in the
future too.
 That’s where most of us find difficult to foresee.

11. Ambiguity -
 Sometimes you will face with very difficult situations
where you are really unclear about the goals to be
achieved and also the alternatives available
 Obviously it falls into unprogrammed decision making
category.

12. Decision Making Models
Classical model
Administrative model
Political Model

13. Classical Model Administrative Political Model
/Beavioral Model
Clear cut problems and Vague Problem and goals Complex problems and
goals Conflicting goals
Conditions of certainty Conditions of uncertainty Conditions of uncertainty
and ambiguity
Full information about Limited information about Inconsistent viewpoints and
alternatives and outcomes alternative and their ambiguous information
outcomes
Rational choice by Satisfcing choice for Bargaining and discussion
individual for maximizing resolving problem using among members of the
outcomes intuition coalitions

14. Intuition
 Intuition (gut feeling) represents a quick
understanding of a decision situation based on past
experience but without conscious mind.
 It is not arbitrary or irrational, because it is based on
years of practice and hands on experience which
makes the managers to take a quick decision without
going through a standard formatted decision process
or painstaking computations.

15.  Psychologist affirms the power of unconscious mind
has abilities that sometimes surpass those of the
conscious mind.
 Most of the managers surveyed in many studies
confirm that intuition plays a major role in decision
making when uncertain and ambiguous situations.
 But recent research shows there are many failures of
intuition based decisions.
 So you need to have a balanced approach with
intuition and rationality

16. Six steps in managerial decision
making process
1. Recognition or defining the problem
2. Analysing the causes
3. Development of alternatives
4. Selection of desired alternatives
5. Implementation of chosen alternative/alternatives
6. Evaluation and feedback

17.  Most important of all the steps is the first step.
 If you make a mistake there all your efforts in the other
five steps will go waste.
 That’s is the case in many faulty decisions
 So lets have a simple example that many use to
demonstrate this important first step
 “ Problem Recognition’

18.  Your company owns a condominium property in
Colombo 3. Nine floors out of ten are given for
businesses. There are three elevators in the building
and they are not the most modern and fast .
 These business Tenants are complaining that their
employees are getting angry and frustrated because
there is always a long delay in getting in to an elevator
to the lobby at rush hours.
 Discuss among your group members and find out the
real problem in this case and provide a creative answer.

19. Many of you will come out with the
following answers if you have not
attempted this before
 More elevators
 Faster elevators
 Bigger elevators
 Encourage employees to use stairs
 Maintain the elevators well

20. But if you analyse the problem well
*****
 People are angry and frustrated in waiting. Why not
provide an answer to that ?
 Let them watch television
 In morning – have the breaking news, newspaper
headlines discussion recorded and played
 In evening – have the breaking news or days headlines
in news or a fine a program that people like
 Have a row of benches

21. If you analyse the alterative answers well you will
see how you have defined the problem
Answer Problem
More elevators Fewer elevators
Fast elevators Slow elevators
Bigger elevators Elevators capacity is not
enough
Encourage people to use People are lazy
stairs
Improve maintenance Elevators go out of service
always

22. Mathematical tools
 There are many quantitative techniques available to help
decision making. Eg. Game theory etc.
 However the main problem with quantitative techniques is
that they are unable to suggest hypotheses or to define
problems or suggest alternatives.
 Those are the most important parts of a problem where
only in qualitative decision making models can provide.
Those abilities remain in the domain of a person’s
experience and creativity.
 Therefore we do not attempt to use such quantitative
techniques in Strategic Decision Making. We will basically
discuss the organizational and process models of decision
making in the qualitative category.

23. Managerial styles of handling a
problem

 The selection of method will also depend on the specific
individual manager’s personal ways of handling problems.
 Some need clear cut information in a brief format to take
decisions,
 Some need much data as possible,
 Some rely on systems and as well as people to provide
information,
 Some would like to find out how people in the organization
will feel about a decision before it is taken.
 Therefore we need to consider many factors when an
effective decision making model is created.

24. Developing an effective decision
making approach
 There have been so many models and tools developed for
decision making by management gurus.
 You may have studied these methods in your Diplomas,
Degrees and Professional Courses. Eg. Brainstorming,
brain sketching, brain writing, concept fan, stakeholder
mapping, mind mapping, gap analysis, six thinking hats,
quality circles, decision tree analysis etc.
 All of them are good but not good enough to use as one
tool alone to find answers to real time business problems

25. Our Challenge is to develop a model
through what we already know
 So in our approach in developing a Super
Strategy, we will not create an entirely
different model but an approach that will
combine the best tools available to get the
maximum output of making fast, widely
supported, high quality decisions on a
frequent basis.

26.  Can you add following
 2698 678
 349 55
 Change the order
 2698
 678
 349
 55

27.  Add
 1+ 2+ 3+ to + 10
 Add 1+ 2+ 3+ to +100
 You will find difficult
 Change
 1 2 3 4 98 99 100
 100 99 98 97 3 2 1
 101 101 101 101 101 101 101
 101 x 100 = 10100 twice amount we want
 Divide it by 2 . Then you get the answer 5050

28.  Re arranging things in our brain.
 No magic we use the existing power of your brain.
 It will simply reap more results
 We need to learn thinking
 Skill to be developed to change the approach of
thinking
 The existing thinking approaches are good for
recognising past and Standard situations
 Not good enough for designing new possibilities

29.  One of the most important
inventions done by man is the
bicycle
 It is a very simple mechanism.
It helps man to use his energy
much effectively.
 It improves use of existing
abilities, skills and energy
 We will use the same thing in
our super strategy

30.  Potential of the mind and the
ability to think is like a car and a
driver
 Cars hose power, engine,
suspension system is the
potential of the car which is
similar to your brain.
 But performance of the car will
depend on the skill of the driver
which is similar to the way you
think.
 Your thinking approach can be
developed to take the maximum
out of the power of brain.

31. Towards a super strategy
 So we will adopt three tools available with
certain adjustment to refine them to include
in one super strategy
 Individual Creative Strategy- Brain writing-
Six Thinking Hats to create the super strategy
 These strategies could be used as one or all
together depending on the problem
 You will not find any magic in tools but the
pattern of thinking is changed.
 Simplicity is the magic.

32. Strategy for
Creativity for
entrepreneurial
decision making

33. Robert Dilts pioneer in NLP has created a
model for Creative Strategy
 Do not think of the problem you have in hand
 Choose three places in front of you that you can step
into
 One for your Dreamer
 One for your Realist
 One for your Critic

34. Dreamer
Think of a time that you were really creative then
step into the dreamer position and relive that time.
If you find difficulty in accessing a creative reference
of yours, think of a person whom you know is a
good creative person.
Think if I were that person how do I be creative like
him
Now you have anchored your dreamer position to
that spot.

35. Realist
 Think back to a time when you were careful and realistic
about some plan either yours own or someone elses.
Step into the spot that you selected as the place for reailist in
you and relive that time.
If you find difficulty in accessing an experience of yours
think of a person whom you know is good at putting plans
into action
Think if I were that person how do I be planning and putting
things into action like him
 When you relived that position come back to uninvolved
position.
 You have now anchored your realistic state to that spot.

36. Critic
 Remember a time that you really criticize a plan in a
constructive way by pointing out the strengths and
weaknesses of the plan and suggesting many
improvements etc. Get into the Critic position that you
selected and relive the experience
 If you find difficulty in accessing an experience of yours
think of a person whom you know is a good critic
 Think if I were that person how do I be critiquing and
forwarding suggestions
 You have now anchored your critic state to that spot.

37. Anchoring
 Now you have anchored the
 Dreamer,
 Realist
 Critic
into three different places.
 In reality you can use the same room or separate rooms
or separate places for these spots.

38. Dreaming
 Now take the problem or the outcome you need to
work with.
 Step into the Dreamer spot
 Let your mind free
 Use visual constructed thoughts
 Brainstorm on your own
 Wonder all around through your mind
 Use “ I wonder if … scenarios to get more and more
options.
 Do not be logical or evaluate. Just dream

39. Realist
 Step into the realist position
 Think about the options/ideas you have dreamed of
 Organise your ideas
 Are they realistic
 How could it be put into practice
 What changes to be made to make them realistic

40. Critiquing
 Step into the critic position
 Think about the plans you made
 Check and evaluate them
 Is there anything missing
 Is the plan needs others cooperation?
 Is it interesting
 What do others think?
 What do you get out of it?
 What is in it for others?
 Make an internal dialogue

41. Circular process
 Step into the dreamers position
 Take in what you have learnt from realist and Critics
position
 Dream again to make options to suit
 Continue the three positions until plan congruently
fits each one.
 Although you use different places and different ways in
the three spots there should be a continuity of
outcome from one to the other.

42. Brain Writing

43. Next Step- Brain writing
 Once you complete the individual creative
strategy, you would be called upon to
participate in a brain writing exercise with
the idea or ideas generated by you during
your individual creative strategy
 In practice, you must select a group that
could really contribute to the problem well

44.  There could be a cross functional team such as
technical experts, financial experts, operational
experts, generalist depending on the problem you have
at hand in the session.
 There could only be a technical team if the problem is
basically technical.
 But whoever the members are, they should have a
strong set of core values and clear understanding of
the mission to craft a creative solution.

45.  In this brain writing exercise, initially you are allowed
to write your suggestion or idea in a paper where
others can comment.
 You will not write your name on the paper, but a code
that you can identify as yours.
 Then you pass your piece of paper with the idea to the
person next to you.
 No one is allowed to talk.

46.  All what you can do is comment on the idea written,
pros and cons or anything that you suggest to improve
the idea.
 Then pass on to the person next to you to do the same
until it comes back to the originator.
 Studies have shown that brain writing has produced
more ideas and refined ideas much better than in an
initial open group brainstorming session

47.  Once the paper comes to originator, he or she will
go through all the comments made by the group
members and further refine his or her idea.
 (In a practical office environment, this could be done
through electronically by sending it to the group by way of
an email.
 It would allow members to think and write in their own
environment.
 It has to be done before the open brainstorming session
begins)

48.  Next Step- In super strategy the alternatives
or decisions that you made through the
individual creative strategy and brain
writing will be filtered through Six Thinking
Hats.

49. Six Thinking Hats

50.  'Six Thinking Hats' is an important and
powerful technique. It is used to look at
decisions from a number of important
perspectives.
 This forces you to move outside your
habitual thinking style, and helps you to get
a more rounded view of a situation.
 This tool was created by Edward de Bono in
his book “6 Thinking Hats”

51.  Many successful people think from a very rational,
positive viewpoint.
 This is part of the reason that they are successful.
Often, though, they may fail to look at a problem from
an emotional, intuitive, creative or negative viewpoint.
 This can mean that they underestimate resistance to
plans, fail to make creative leaps and do not make
essential contingency plans.

52.  If you look at a problem with the 'Six Thinking Hats'
technique, then you will solve it using all approaches.
Your decisions and plans will mix ambition, skill in
execution, public sensitivity, creativity and good
contingency planning.
 You can use Six Thinking Hats in meetings or on your
own.
 In meetings it has the benefit of blocking the
confrontations that happen when people with
different thinking styles discuss the same problem.

53.  Each 'Thinking Hat' is a different style of
thinking.
 There is no arguments on this system
 There is parallel thinking
 Everybody will do one thing at a time
 All will wear one hat at a time
 A lot of time could be saved from this
system

54.  White Hat:
With this thinking hat you
focus on the data available.
Look at the information you
have, and see what you can
learn from it.
 Look for gaps in your
knowledge, and either try to
fill them or take account of
them.
 This is where you analyze
past trends, and try to
extrapolate from historical
data.

55.  Red Hat:
'Wearing' the red hat, you
look at problems using
intuition, gut reaction, and
emotion.
 Also try to think how other
people will react
emotionally.
 Try to understand the
responses of people who
do not fully know your
reasoning.

56.  Green Hat:
The Green Hat stands for
creativity.
 This is where you can develop
creative solutions to a
problem.
 It is a freewheeling way of
thinking, in which there is
little criticism of ideas.
 A whole range of creativity
tools can help you here.

57.  Yellow Hat:
The yellow hat helps you to
think positively.
 It is the optimistic viewpoint
that helps you to see all the
benefits of the decision and
the value in it.
 Yellow Hat thinking helps
you to keep going when
everything looks gloomy and
difficult.

58.  Black Hat:
Using black hat thinking, look at
all the bad points of the
decision. Look at it cautiously
and defensively.
 Try to see why it might not work.
 This is important because it
highlights the weak points in a
plan.
 It allows you to eliminate them,
alter them, or prepare
contingency plans to counter
them.

59.  Black Hat thinking helps to make your plans 'tougher'
and more resilient.
 It can also help you to spot fatal flaws and risks before
you embark on a course of action.
 Black Hat thinking is one of the real benefits of this
technique, as many successful people get so used to
thinking positively and often they cannot see
problems in advance.
 This leaves them under-prepared for difficulties and
make them fail

60.  The Blue Hat has been used
by the meeting's Chair to
move between the different
thinking styles.
 He or she may have needed to
keep other members of the
team from switching styles,
or from criticizing other
peoples' points.
 This thinks of thinking
process

62. Multi voting
 Step 1 – Write the list of ideas in a board
 Step 2 - Assign a letter to each item to avoid confusion of item
designations with the vote tally.
 Step 3 - Vote
 ! Each team member selects the most important one-third
 of the items by listing the letters which appear next to those items. For
 Example, if there are 60 items, each person should choose the 20 items
(one third of the total)
 ! Each team member may cast only one vote per idea and must cast all
allotted

63.  Step 4 - Tally the votes. Place a checkmark next to
each item for each vote it received. Retain the items
with the most votes for the next round of voting.
Rule of Thumb - for deciding how many items to
eliminate in each round, depending on the size of the
group:
 ! If the team has 5 or fewer members, eliminate those
items that receive 2 or fewer votes.
 ! If the team has 6 to 15 members, eliminate all items
that receive 3 or fewer votes.

64.  Step 5 - Repeat. In the second round, if you have time
you can have a quick discussion about the ideas listed,
then each person again selects the top one-third of the
items.
 Repeat steps 3 and 4 until only a few items remain.
 Never multivote down to only one item.
 Then you can have a final discussion to select the best
by show of hands.

65.  Although you will observe that there are many steps in this
model, it will work quickly than you think when the
organization get use to use the model.
 This is a super strategy of combining many tools of
decision making together to get the best possible within a
shortest period for strategic level decisions.
 This could be used by small companies to large companies
and government and military too.
 The beauty of the model will be seen only when you put it
on to practice.
 You will also observe certain areas that need to be adjusted
to suit your own style and environment once you start using
it.

66.  The decision that you take are important strategic level
decisions and the process should be totally
confidential as they are internal for the group.
 The most important advantage of this model is that
everybody has become a part of the decision making
process and once the decision is taken they will go out
with the attitude that this is “ our decision”.
 If anything goes wrong everybody is responsible and
therefore everybody will take steps to correct it

67.  If the chosen alternative fails, the group can learn from it
and find together what went wrong and try another
alternative quickly as it may have already been discussed at
length in the decision making session already held.
Another lengthy session may not be required.
 You also should develop a mechanism to pull the plug early
if you find that the decision that you took is not really
working. It should be an inbuilt part of every decision.
 Professor Robert Sutton of Stanford University says “ fail
early, fail often, and pull the plug early”