DECISION MAKING talk by Prof. Ajit Chakravarti

DECISION MAKING by Prof. Ajit Chakravarti

Session Date: 11:11:2006

Terminology/Learning’s shared during the session:

· Quality Time: Add Value to time. The time during which we achieve what we aspire for

· All Decision Making – makes us move on a path of change

· The More we grow – the more Decision we take by Ease

· Stress Buster: Decision making is like a stress buster, whether decision take was appropriate or not, can be decided later but for that moment it acts like stress buster

Objectives of the session:

· Understand the Importance of Effective Decision Making in Management

· Understand the Role of Time and Relationships in Decision Making

· Experiencing Problem and Opportunity finding Processes in real life business Situations

· Understand the personality Dimension in the decision making process

· Appreciation of the distinction between programmed and non programmed decision

· Appreciation of certainty, risk and uncertainty in decision making

· Understand different decision making models

· Identify individual decision making approaches at the conclusion of the season

Parameters of the “Key Objectives” of the session:

· Involvement

· Sharing and Experience

· Open Mind / Willingness

· Effective Communication

· Risk Taking – Conscious of Consequences

· Participation

Why Decision Making? (A group Brain storming session)

· Life is Full of Opportunities

· Life is a Choice

· Status Check

· New Beginning

· Achieve a Goal

· New Beginning

· Turning Point

· Overcome Crisis

· Status Check

NIKE CASE STUDY: - Key Highlights

· Slow Growth in the market/De Growth

· Competition eating into

· While Reebok looked at short time success – Nike had long time Ambitions

NIKE CASE STUDY: - What decisions were taken by the company?

· Strategy to Specialize

· Decision to “get out of the situation”

· Part of the dream team in Olympics

· Worked on Comfort factor – in relation to the game of Basket Ball

· Longitivity of the Relationships

· Multiple form of identifications found in Jordan

· Teaming up with a “Fading Star”

· Choice of Jordan – why? - Multiple Personalities as Brand Ambassador

NIKE CASE STUDY: - How appropriate were the decisions?

· Relationship as a factor

· Creating a Differentiator

NIKE CASE STUDY: - Some of the Key Findings

· Calculated risk involved in all Decision Making process

· Decision making is a consequence of the prevailing circumstances – which were:

o Connect to the path which is different

o FORESIGHTEDNESS

o Detach and Detached Involvement

· Escalation of the commitment

· Decisions should be frozen on time

· Timing (and Environment) of the Decision making is very important

· Variable in Decision Making - What is there in today may not be there tomorrow

· Time Elapsed (from the time when the decision was taken and to the time when the action was implemented) – sharper perception for what would be there in future

· Game Theory – Decision Maker should create an environment for the decision to be appropriately followed

· Set of Decisions – Make a strategy (example that of many how many leaves make a branch of the tree)

· Closing of the Decision id VERY IMPORTANT

· Set of Decisions – lead to a Grand Play

TIME and HUMAN RELATIONSHIPS in Decision Making:

· Concept of Chinese/Japanese vis-à-vis Americans while signing an agreement

o While Chinese/Japanese make an agreement – for them that’s a start of Relationship

o Chinese/Japanese have a clarity of roles and what stage of negotiation they are in

o Chinese/Japanese would be there on site and not like Americans who would manage with, say – video conferencing

o Chinese/Japanese – while there decision making process – leave room for the “expect the unexpected”

· Decision Making process should not be done in isolation – and also be aware of the party involved in the same

· Time “0” to Time “T1”

Problem Finding and Opportunity Finding

· What is a problem?

· What is an Opportunity?

Example: that of 35 Afro American Farmers:

· Soya bean cultivation

· Problem was to find a new market

· And then Finding an Application (alternate plan)

Problem finding (sensing a plan)

· Deviations from the past experience

· Deviation from a set of plans

· The performance of the competitor

Alert Managers – Sense the same problem early

· Sense of REALITY

· FINE TUNED Perception

· EQ (able to sense thru “with people” through verbal acts

· IQ (ale to sense through knowledge and intelligence

Three Pitfalls

· False associations of events – Wrong Mergers and Acquisitions

· False Expectations of the events – FDI in Retail

· False Self Perception and Social Image – We are BIG, they are SMALL . . . so we will also do it and end up biting the dust)

Opportunity findings

· Missed Opportunity create problems

· Opportunities are found while exploring the problems

· Use of Di – Electical Enquiry Method (Devils Advocate)

Enormous Research on Problem solving where as little research on Problem Finding:

· “Quote Unquote” – Peter Ducker: Opportunities rather problems are the key to organizational and managerial success

· Solving a problem merely restore normality where as progress must come form the exploitation of the opportunities

Problem Recognition

What INFO to Collect

ROLE of JUDGEMENT

PEOPLE with ACUMEN

Example: Many People Leaving the Organisation – Realiszing that many people leaving the organisation id not about attrition but situation of “high pressure” leads to “weak people” leaving the organisation which is for the good og the organisation in the long run

Some more - Terminology/Learning’s shared during the session:

· Failure Avoidance: Let the juniors/subordinate take the decisions pertaining to there accounts and responsibility and let “you” as managers look into the larger interest. Rely on people that what ever task given, they would perform to there optimum level – trust there capability

· Certainty /Risk/Uncertainty

· Atkinson’s 3 Needs Theory:

o Affiliation

o Power

o Achievement

· LIFO – Last in First Out

· Pilot Plan

· Game Theory – You don’t operate in Isolation – take into account the competition

· Self Introspection on Problem Recognition:

o Growth

o Innovation