problem solving and decision making copy

05/01/23 1Advesh Consultancy Services

PROBLEM SOLVING AND DECISION MAKING


ICE BREAKER


ICEBREAKER

• What is your leisure activity?• Who , living or dead , do you most admire ,

and why?• What is your greatest achievement?• What are your positive qualities?• If you had unlimited resources , what would

you buy which would give you most pleasure?


PROGRAMME OBJECTIVE

• To clarify and define the problem.• To understand the usefulness of collaborative

problem solving and decision making.• To examine different decision

making models.• To utilize creativity in the problem

solving/decision making process.• To plan, practice, and problem solve with

making decisions through case studies, role playing and group discussions.


Please write a One Sentence Definition of

PROBLEM SOLVING and

DECISION MAKING.


DEFINITION –PROBLEM SOLVING

A systematic approach to defining the problem and creating a vast number of possible solutions without judging

these solutions.


PROBLEM SOLVING

Problem solving is a cognitive processing directed at achieving a

goal where no solution method is obvious to the problem solver.


PROBLEM SOLVINGProblem Solving is …..• “….. the art of finding ways to get

from where you are now to where you want to be (assuming you do not already know how).

• The ‘problem’, therefore, is the gap between the present situation and a more desirable one.”

(Nolan 1989)Is this Problem Solving?

A B?

TRIPLE CONSTRAINT PRINCIPLE

• Something is a problem if:

it makes you lateit increases costsit degrades performance.

time cost

performance


If none of these occur, it’s NOT a problem, just a hindrance.


DEFINITION – DECISION MAKING

The act of narrowing down the possibilities, choosing a course of

action, and determining the action’s potential consequences.


“It's not a problem that we have a problem. It's a problem if we don't deal with the problem.”--Mary Kay Utech


WHAT DOES IT INVOLVE?


• Problem solving is a skill, a tool and a process.

• It is a skill because once you have learnt it you can use it repeatedly, like the ability to ride a bicycle, add numbers or speak a language.

• It is a tool because it can help you solve an immediate problem or to achieve a goal.

• It is also a process because it involves taking a number of steps.


PROBLEM SOLVING

• Skill

• Process

• Tools


WHAT SKILLS DO YOU USE IN WHAT SKILLS DO YOU USE IN PROBLEM SOLVING?PROBLEM SOLVING?


• Making judgements

SKILL SETS IN PROBLEM SKILL SETS IN PROBLEM SOLVING?SOLVING?

• Analytical skills

• Decision making• Collecting information

• Planning05/01/23 18Advesh Consultancy Services

PROBLEM SOLVING PEOPLE? Experts. People who know the area of

knowledge thoroughly. Solving problems becomes more natural.

People who can think of alternatives even when no clear solutions seems apparent.


Have a better memory for relevant details in the problem.

Classify problems according to their underlying principles.

Use well-established procedures. Work forwards towards a goal

(rather than backwards).

EXPERT PROBLEM SOLVERSEXPERT PROBLEM SOLVERS


ACTIVITY 110.45-11-15

Who is the murdererThe Zin Obelisk

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ANSWER AND RATIONALE

• The answer is Neptiminus.

Rationale1. The dimensions of the zin indicate that it contains 50,000 cubic feet of stone blocks.2. The blocks are 1 cubic foot each, therefore, 50,000 blocks are required.3. Each worker works 7 schlibs in a day (2 schlibs are devoted to rest).4. Each worker lays 150 blocks per schlib, therefore each worker lays 1050 blocks per

day.5. There are 8 workers per day, therefore 8,400 blocks are laid per working day.6. The 50,000th block, therefore, is laid on the sixth working day.7. Since work does not take place on Daydoldrum,the sixth working day is Neptiminus.


TEA

11.00 AM – 11.15 AM


ContentUnderstanding

Domain-dependentproblem-solvingstrategies

Self-regulation

Metacognition Motivation

Planning Self-monitoring Effort Self-efficacy

PROBLEM SOLVING REQUIREMENTSPROBLEM SOLVING REQUIREMENTS


Understanding the Process:Understanding the Process:‘‘How to Solve it’How to Solve it’

Engage: I want to and I can

– Read the problem (and all the information)

– Listen – Learn about the

situation that poses the problem

– Motivation– Overcome panic05/01/23 25Advesh Consultancy Services

Understand the problem: define

Put in the time to define the problem:– Discuss.– Ask questions.– Visualize.– Restate the problem in your own words.– Explain the problem to someone else.

Understanding the Process:Understanding the Process:‘‘How to Solve it’ How to Solve it’


Plan a procedure to solve the problem

– Prior experience.– Data available.– Content knowledge.– Patterns.– Estimation.– Alternate solutions.– Feasibility.



Collect data & the knowledge required

– A solution may be required based upon imperfect knowledge.



Select the preferred solution: test, use and evaluate

– Check each step– Can you determine

clearly that each step is correct?

– Can you prove that each step is correct?



Reflect on the process

– Are you certain you solved the problem?

– Can you check the result and your argument?

– Can use alternate solutions?– What did you actually do? – Can you explain this to another? – Can you use the result &/or method

for another problem?



PROBLEM SOLVING• DEFINE• INFORMATION/MEASURES• ANALYSE• GENERATE ALTERNATIVES• SELECT

ALTERNATIVES/DECIDE• IMPLEMENT


STEP 1

DEFINE


Collect all the relevant information. Clarify background issues. What are the constraints? Are there sub-problems that can be

dealt with separately? Can the problem now be

formulated?

Defining The Defining The ProblemProblem


PROBLEM/OPPORTUNITY STATEMENT WORKSHEET

What is the area of concern?

What impact this problem already had? What evidence do you have that it is really a problem worthy of attention?

What will happen if the business doesn’t address this problem?

Summarize the above information in a concise statement


ACTIVITY 212.00 – 1.00

DEFINE PROBLEM


ACTIVITY 2 • Problem 1

I am in the habit of coming late to office

• Problem 2

We could not meet production targets

• Problem 3

Take an issue in work situation. Define the problem.


1.00 – 2.00

LUNCH


STEP 2

INFORMATION/MEASURES


ACTIVITY 32.00 PM – 2.15 PM


ACTIVITY

• Imagine that you were going to buy a house in a new area. List ten things that you would want to know about a house before you gave it serious consideration . Tick any of these things that you could find out from the agent’s information. How could you find out the other things?


• Do we have all of the information and data we need?

• Collect data and digest the information.


TYPES OF INFORMATION

• QUANTITATIVE

• QUALITATIVE


Quantitative

• How much?• How many?• How frequently?• How likely?• How quickly?


QUALITATIVE

• What?

• Why?

• How?


DATA SOURCES

• Primary

Data gathered by you directly for your purpose

• SecondaryGathered by others for their purpose


PRIMARY DATA

• Give examples


SECONDARY DATA

• Collected by other Depts.

• Reference Books

• Databases

• Journals

• Published Reports

• Govt Statistics


ACTIVITY 42.30 PM 3.00 PM

INFORMATION


ACTIVITY 4A

• In a production line, the output of a particular machine has come down drastically. There was a hue and cry that the operator is intentionally slowing down production.

• What all information need to be collected before commencing any action?


ACTIVITY 4B

• First batch of Vacuum Circuit Breakers supplied by a Company in India in the year 1981 failed miserably

• The Technical collaborators, the Manufacturers and the Customers were trying to resolve the issue

• What all information need to be collected?


ACTIVITY 4C

• On a piece of paper, draw a map of the people you know. Put yourself in the middle and connect the people you know very well in the first circle. Add people you know through these network in the next layer and connect them with spokes. Do three levels.


REVIEW AND SHARING BY INDIVIDUALS

3.00 PM – 3.15 PM


3.15 PM-3.3.30PM

TEA


STEP 3

ANALYSE


ANALYZE THE PROBLEMDo not make the mistake of assuming you know what is

causing the problem without an effort

to fully investigate the problem you have defined.

Try to view the problem from a variety of viewpoints, not just how it affects you.

Think about how the issue affects others.

It is essential to spend some time researching the problem.


Questions to Ask When Analyzing the Problem:

• What is the history of the problem? How long has it existed?

• How serious is the problem? • What are the causes of the problem? • What are the effects of the problem? • What are the symptoms of the problem? • What methods does the group already have for dealing with

the problem? • What are the limitations of those methods? • How much freedom does the group have in gathering

information and attempting to solve the problem? • What obstacles keep the group from achieving the goal? • Can the problem be divided into sub problems for definition

and analysis


MAKING SENSE OF NUMBERS

• Averages(Mean,Median,Mode)• Grouping of data• Distribution• Trends• Correlation• Pie charts


ANALYSE• Data Analysis

ExploringGenerating Theories about causesVerifying/eliminating causes

• Process Analysis

Exploring Generating Theories about causes Verifying/eliminating causes


`DATA ANALYSIS PROCESS ANALYSIS

EXPLORING Examine data to discover cluesTOOLSPareto Charts, Run Charts, Histograms

Understand what actually happens in the processTOOLSBasic flowchart,Depolyment flow charts

GENERATING HYPOTHESIS

Generate ideas about the causesTOOLSBrainstorming, Cause and Effect Diagram

Use the process maps to identify areasTOOLSBrainstorming, Value Analysis

VERIFYING CAUSES

Gather additional data to verify hypothesisTOOLSScatter Diagram, Stratification

Quantify delays/lost time in various process steps Experiment with changesTOOLSProcess maps


Use Pareto Charts to find the “Vital few”


Use run/trend charts to find “patterns over time”


Cause and Effect Diagram


When should a fishbone diagram be used?

• Need to study a problem/issue to determine the root cause?

• Want to study all the possible reasons why a process is beginning to have difficulties, problems, or breakdowns?

• Need to identify areas for data collection? • Want to study why a process is not performing

properly or producing the desired results


How is a fishbone diagram constructed?

• Draw the fishbone diagram.... • List the problem/issue to be studied in the "head of the fish". • Label each ""bone" of the "fish". The major categories typically

utilized are: • The 4 M’s:

– Methods, Machines, Materials, Manpower • The 4 P’s:

– Place, Procedure, People, Policies • The 4 S’s:

– Surroundings, Suppliers, Systems, Skills• Note: You may use one of the four categories suggested, combine

them in any fashion or make up your own. The categories are to help you organize your ideas.


How To Complete The 5 Whys

1. Write down the specific problem. Writing the issue helps you formalize the problem and describe it completely. It also helps a team focus on the same problem.2. Ask Why the problem happens and write the answer down below the problem.3. If the answer you just provided doesn't identify the root cause of the problem that you wrote down in step 1, ask Why again and write that answer down.4. Loop back to step 3 until the team is in agreement that the problem's root cause is identified. Again, this may take fewer or more times than five Whys.


5 Whys ExamplesProblem Statement: Customers are unhappy because they are being shipped products that don't meet their specifications.1. Why are customers being shipped bad products? - Because manufacturing built the products to a specification that is different from what the customer and the sales person agreed to.2. Why did manufacturing build the products to a different specification than that of sales? - Because the sales person expedites work on the shop floor by calling the head of manufacturing directly to begin work. An error happened when the specifications were being communicated or written down.3. Why does the sales person call the head of manufacturing directly to start work instead of following the procedure established in the company? - Because the "start work" form requires the sales director's approval before work can begin and slows the manufacturing process (or stops it when the director is out of the office).4. Why does the form contain an approval for the sales director? - Because the sales director needs to be continually updated on sales for discussions with the CEO.


Verifying Causes

• Correlation• Stratification• Pilot Testing


1/02/2007 Business Process Management 70

Types of Flow ChartsTypes of Flow Charts Linear FlowchartLinear Flowchart

Deployment FlowchartDeployment Flowchart

Opportunity FlowchartOpportunity Flowchart


Linear FlowchartLinear FlowchartStart

Collect inputs

Draft Circular

Type rough

Submit to A

Sign(A)

Retype

Make Copies DistributeType smooth

OK?

Yes

No

End


Deployment FlowchartDeployment Flowchart

AA BB CC

Collect Input

Draft

Retype

Submit to C

Make Copies

Type rough

Type smooth

Distribute

Accept?

Yes

NO

Sign

PROCESS MAP

Customer pulls time-stamped ticket

Customer parks car

Customer returns tocar to leave

Customer drives tocashier at exit

Cashier System

Customer exits

Recieve ticket fromcustomer

Stamp exit time onticket

Read indicator stampfor fee

Observe exact time forborderline rate

Place ticket in storagebin

Enter charge onregister

Accept payment andreturn change

Raise gate arm forcustomer to exit

Accounting departmentgets reportComplete daily report

(End of Day)

Customer System Cashier System


Value and Cycle Time Worksheet

Process Step 1 2 3 4 5 6 7 8 9 10 Total Percentage

VALUE

Value added

Value enabled

Non value added

TIME

Work time

Wait time

Total Time

Total Value added time

Percentage value added time


Correlation Analysis


Past Experience: Future Problems

Have we ever encountered a problem like this before?

Do we have all of the information and data we need?

Is there any pattern to what we know?

Can we construct a table or a picture?

What might the solution be? What would assist us in getting to a

solution?05/01/23 76Advesh Consultancy Services

END OF DAY 1


DAY 2


STEP 4

GENERATE ALTERNATIVES


Good decisions emerge from a set of feasible alternatives


Tips for Generating Alternatives

• Brainstorm• Involve outsiders• External Benchmarking• Encourage members to step out of their

traditional roles• Ask probing questions• Be willing to consider views differing from yours• Revisit abandoned alternatives


• Vertical Thinking

• Lateral Thinking


What is Vertical Thinking?

Basing our thought process on prior knowledge and experience.

Using logic that relates only to our immediate experience.

Constraining our creativity and ability to solve problems.


What is Lateral Thinking?

• Changing orientation and perception. • Generating new ideas and visions.• Exploring multiple possibilities and

approaches.


• Vertical Thinking is selective• One may reach a conclusion by a valid series

of steps• Lateral Thinking is generative• Vertical Thinking develops the ideas

generated by Lateral Thinking


IX


ACTIVITY 510.15 AM – 11.15 AM


How would you divide a square into four equal pieces

Give at least 6 alternatives

• Time 15 minutes• EXERCISE


• Make a square out of this

• 10• minutes• Exercise


The Dog, the Goose and the Bag of Corn

The farmer takes the goose across and leaves the dog with the corn. The farmer then goes back across the stream and gets the corn. He takes the goose back across with him because he cannot leave it with the corn. He then gets the dog and takes it across leaving it on the other side with the corn. He then goes back across once again, gets the goose and returns to the other side of the stream with all safely across and not eaten!


Exercise5 minutes

• You have a pile of 24 coins. 23 of them have the same weight. But one of them is heavier than the rest. You are given a scale but no weights. Your task is t identify the heavy coin in no more than three uses of the scale.


Exercise3 minutes

• A conference room contains three separate wall-mounted spotlights - right, left and front of stage. Each is controlled by its own on-off switch. These three switches are numbered 1, 2 and 3, but they are in a back-room which has no sight of the spotlights or the conference room (and there are no reflections or shadows or mirrors, and you are alone). How do you identify each switch correctly - right, left, front - if you can only enter the back-room once


Exercise 5 minutes

• Four men, one of whom was known to have committed murder, made the following statements to the police.

• Arun: Dave did itDave: Tony did itGeorge: I did not do itTony: Dave lied when he said I did it

If only one of these four statements is true, who was the guilty man?


Exercise5 minutes

• You are the treasurer in charge of the Royal mint, which produces a single type coin, the Grote. There are ten machines producing Grote, one machine is producing Grote weighing one gram less than they should, each coin should weigh 10 grams. You have a set of broken scales which can be fixed to provide one single weigh of a single amount (no weight changes are allowed). Using the scales once you must identify the single faulty machine.

• How do you do it?


Exercise


11.00 AM-11.15 AM

TEA


STEP 5

SELECT ALTERNATIVES/DECISION MAKING


Types

• Strategic Decision• Business Decision• Operational Decision


ACTIVITY 611.45 AM – 12.00 NOON


ACTIVITY 5

• List three personal decisions you’ve made in the last one or two years.

• List three decisions you need to take in the next one year in your personal life.

• Classify them into Strategic , Business and Operational


How are decisions madein organizations?

Decision making.

– The process of choosing a course of action for

dealing with a problem or opportunity.

Advesh Consultancy Services 10305/01/23

DECISION MAKING

• ENVIRONMENT• DECISION MAKING

MODELS• DECISION MAKING

REALITIES• AUTHORITIES IN DECISION

MAKING• INFLUENCING FACTORS IN

DECISION MAKING

• 7 Cs


ENVIRONMENT



Decision environments include:

– Certain environments.

– Risk environments.

– Uncertain environments.



Certain environments.– Exist when information is sufficient to predict the

results of each alternative in advance of implementation.

– Certainty is the ideal problem solving and decision making environment.



Risk environments.– Exist when decision makers lack complete

certainty regarding the outcomes of various courses of action, but they can assign probabilities of occurrence.

– Probabilities can be assigned through objective statistical procedures or personal intuition.



Uncertain environments.– Exist when managers have so little information

that they cannot even assign probabilities to various alternatives and possible outcomes.

– Uncertainty forces decision makers to rely on individual and group creativity to succeed in problem solving.



Uncertain environments — cont.– Also characterized by rapidly changing:

• External conditions.• Information technology requirements.• Personnel influencing problem and choice definitions.

– These rapid changes are also called organized anarchy.


DECISION MAKING MODELS


• Classical decision theory

• Behavioural decision theory


What are the usefuldecision making models?

Classical decision theory.– Views the decision maker as acting in a world of

complete certainty.Behavioral decision theory.

– Accepts a world with bounded rationality and views the decision maker as acting only in terms of what he/she perceives about a given situation.



Behavioral decision theory.– Recognizes that human beings operate with:

• Cognitive limitations.• Bounded rationality.

– The behavioral decision maker:• Faces a problem that is not clearly defined.• Has limited knowledge of possible action alternatives

and their consequences.• Chooses a satisfactory alternative.



Classical decision theory.– The classical decision maker:

• Faces a clearly defined problem.• Knows all possible action alternatives and their

consequences.• Chooses the optimum alternative.

– Is often used as a model of how managers should make decisions.



Classical decision theory:– May not fit well in a chaotic world.– Can be used toward the bottom of many firms,

even most high-tech firms.Behavioral decision theory:

– Fits with a chaotic world of uncertain conditions and limited information.

– Encourages satisfying decision making.


LUNCH1.00 PM – 2.00 PM


DECISION MAKING REALITIES


Decision making realities

– Most decision making in organizations goes beyond step-by-step rational choice.

– Most decision making in organizations falls somewhere between the highly rational and the highly chaotic.

– Decisions must be made under risk and uncertainty.


Decision making realities

– Decisions must be made to solve non-routine problems.

– Decisions must be made under time pressures and information limitations.

– Decisions should be ethical.


How do intuition, judgment, and creativity affect decision making?

Intuition.

– The ability to know or recognize quickly and

readily the possibilities of a given situation.

– A key element of decision making under risk and

uncertainty.


How do intuition, judgment, and creativity affect decision making?

Judgment– Simplifying strategies or “rules of thumb” used to

make decisions.– Makes it easier to deal with uncertainty and

limited information.– Can lead to systematic errors that affect the

quality and/or ethics of decisions.


ACTIVITY 6

• Imagine that you are driving across country to an important meeting that will start in an hour’s time, along a route you have travelled several times before. You are thirty miles from your destination and the road is clear ahead of you. You see a signpost pointing up to a narrow side road that you have not noticed on earlier journeys. It indicates 20 miles to your destination.


ACTIVITY 6

1. Would you turn into the side road without further thoughts?

2. Ignore the side road and continue on your existing route?

3. Stop the vehicle, consult a map and then decide whether to drive up the side road? Why?


AUTHORITIES IN DECISION MAKING


AUTHORITY IN DECISION MAKING

Deciding who should participate.– Authority decisions.

• Made by the manager or team leader without involving other people and by using information that he/she possesses.

– Consultative decisions.• Made by one individual after seeking input from group members.

– Group decisions.• Made by all members of the group.


ACTIVITY 73.00PM – 3.15 PM


ACTIVITY

• Give three examples of decisions that you would refer to a senior manager in your organisation.

• Do these decisions have anything in common?


TEA3.15 PM – 3.30 PM


INFLUENCING FACTORS IN DECISION MAKING


• Technology

• Culture

• Ethics


How do technology, culture, and ethics influence decision making?

Increasingly complex problems and opportunities face decision makers in organizations due to various workplace trends.

These workplace trends are changing the who, when, where, and how of decision making.



Information technology and decision making.– Artificial intelligence.

• The study of how computers can be programmed to think like human beings.

• Will allow computers to displace many decision makers.

– Expert systems that support decision making by following “either-or” rules to make deductions.



Information technology and decision making — cont.– Fuzzy logic and neural networks that reason

inductively.– Computer support for decision making.

• The Internet.• Company intranets.• Decision support software to facilitate virtual

teamwork.



Cultural factors and decision making.– Culture is “the way in which a group of people solves

problems.”– North American culture stresses decisiveness, speed, and

the individual selection of alternatives.– Other cultures place less emphasis on individual choice

than on developing implementations that work.– The most important impact of culture on decision making

concerns which issues are elevated to the status of problems solvable with the firm.



Ethical issues and decision making.– Ethical dilemma.

• A situation in which a person must decide whether or not to do something that, although personally or organizationally beneficial, may be considered unethical and perhaps illegal.

– Ethical dilemmas are often associated with:• Risk and uncertainty.• Non-routine problem situations.



Ethical decision-making checklist.– Is my action legal?– Is it right?– Is it beneficial?– How would I feel if my family found out about

this?– How would I feel if my decision were printed in

the local newspaper?



Suggestions for integrating ethical decision making into the firm.– Develop a code of ethics and follow it.– Establish procedures for reporting violations.– Involve employees in identifying ethical issues.– Monitor ethical performance.– Reward ethical behavior.– Publicize ethical efforts.



Implications of ethics for decision making.– Morality is involved in:

• Choosing problems.• Deciding who should be involved in making decisions.• Estimating the impacts of decision alternatives.• Selecting an alternative for implementation.

– Moral conduct does not arise from after-the-fact embarrassment.


ACTIVITY 8

• One of the best performing employees working under you was caught carrying one stapler belonging to the company at the gate.


6 Cs OF DECISION MAKING


Six C's of Decision Making (1 of 3)

Construct

Compile. Collect. Compare

. Consider

. Commit.


Decision Making (Six C's) (2 of 3)

Construct a clear picture of precisely what must be decided.

Compile a list of requirements that must be met.

Collect information on alternatives that meet the requirements.


Decision Making (Six C's) (3 of 3)

Compare alternatives that meet the requirements.

Consider the "what might go wrong" factor with each alternative.

Commit to a decision and stick to it.


Inherent Personal: Traps (1 of 2)

Trying too hard to play it safe. Letting fears and biases tilt your

thinking and analysis. Getting lost in the minutia. Craving unanimous approval. Trying to make decisions which

are outside your realm of authority.


Inherent System: Traps (2 of 2)

Willing to begin with too little, inaccurate, or wrong information.

Overlooking viable alternatives or wasting time considering alternatives which have no realistic prospects.

Not following the six C's. Failing to clearly define the results

you expect to achieve. Worst of all, failing to reach a

decision.05/01/23 148Advesh Consultancy Services

FINANCIAL TOOLS FOR EVALUATING ALTERNATIVES

• ROI• Payback• Net present value• Internal rate of return• Breakeven analysis• Sensitivity analysis


ACTIVITY 9


ACTIVITY

• List four or five decisions you made at work/home regardless of their size or importance . For each decision, consider whether you really needed to make it or whether the decision could have been handled in some other way. Perhaps it could have been dealt with by someone else. Or perhaps there was not a decision to make at all.


STEP 6

IMPLEMENT


IMPLEMENT

• Communicate• Train• Execute• Review


• PLAN• DO• CHECK• ACT

• PDCA CYCLE
