Category Archives: Decision Making

Judgment and Decision Making

The other day I checked to see how many posts I had tagged related to Time Span. The number was 153. Time Span, as a concept, comes from the most basic thing we do, as a company, the most fundamental thing we do, as managers. Time Span comes from Goal Setting.

What is a goal? Take all the ornaments off. A goal is a “what by when.” Often, we focus on the “what” and rarely pay much attention to the “by when.” But it is the “by when” of every goal that determines the Time Span.

Time Span is the length of time a person works into the future, without direction, using their own discretionary judgment to achieve a specific goal.

Three weeks ago, fifteen of you, began work in our online platform (www.workingleadership.com). The first Subject Area was Goal Setting and Time Span. The discussion now shifts its attention from the Goal to Discretionary Judgment.

In the pursuit of any goal, we have to make decisions. We make those decisions using our discretionary judgment. The Time Span of the Goal (the “by when”) has a direct relationship to the Time Span of Discretion.

An important discussion, for managers, surrounds the decisions that must be made to achieve a specific goal.

What is your most important goal? What are the decisions you have to make to achieve that goal?

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Work Harder, Not Smarter

“My team is now down to three people,” Marissa explained. ” I hope that was my last reduction in force. I don’t know how we are going to get everything done.”

“How are you going to get everything done?” I asked.

“I don’t know. I guess we will just have to work harder.”

“Work harder, not smarter, that’s the ticket,” I replied.

Marissa smiled and nodded. “You are right, our work volume is down. But when you lose people, there are some things you still have to do.”

“Do you? How are you going to get everything done?”

“I guess there are some things we are NOT going to do.”

“The first step to higher productivity is to eliminate things that are not necessary. How are you going to make that decision?”

What Should Be Rejected?

As of right now, the Big 3 bailout bill is stalled. It appeared for a moment yesterday that it might make it. World markets are reacting to this delay.

As we work our way through this recession, will some fundamentals about the auto industry be significantly different in another 18 months? Here is the biggest question. Will there be some fundamental changes in your industry, in your market during the next 18 months?

Your biggest challenge is not to get small and hunker down. Your biggest challenge will be to understand how your company will be significantly different. The decisions you make, will be different.

The world is looking at itself. It is looking at its largest industries and asking this question. Is the way these companies are organized to do business, something that should be preserved or something that should be rejected, to make way for something new?

How will you make those decisions for yourself? How is your company organized to do business? What should be preserved? What should be rejected to make way for something new?

Working Leadership Online is not another old, tired leadership program. Working Leadership Online is about you, leading in this new world. It starts in January with our first project assignment on February 2, 2009. To find out more, visit www.workingleadership.com.

Your Market Won’t Allow It

In the past few months, you made decisions you never thought you would make. And, you will have more problems to solve and more decisions to make. We are closer to the beginning of this recession than we are to the end.

This will be the test for management. Yet, I am calm about the decisions you will make. The market will not allow you to make bad decisions. There will be quick and irreversible punishment for bad decisions. Those who make bad decisions will not be around to tell their story.

But, the worst of your decisions are not made when times are bad. The worst of your decisions are made when times are good. It’s just that now, you may have to pay for those bad decisions.

Yesterday, we announced a new online program specifically designed to help management get through the next two years, to create a foundation to take advantage of the recovery (summer of 2010). This program will help managers solve problems and make decisions about your organization. The first project field work will be assigned February 2. If you want more information about this program, or how it works, you can follow this link, www.workingleadership.com, or email me directly.

Trial and Error?

“I don’t like to think about it,” Roselle explained, “but I keep thinking that maybe I’m the next one to get a pink slip.”

“I know, in these times, it is tempting for a company to save overhead costs, to lop off heavier management salaries. And some companies have no other choice,” I replied. “But in times like these, we will see more volatile change than normal, and there will be more management decisions to make in response to that change. Management decisions cannot be made without a manager.”

“I don’t know about that. I have seen some boneheaded people making decisions in my day.”

“Of course you have. Sometimes we leave the wrong decisions to the wrong people. Some people make decisions through trial and error (in front of the customer). Some people are able to tap into their experience, or the experience of other people to see if we have ever solved that problem before. But I have to tell you, some problems you see today, have NOT been solved before. Those problems will require analysis, to get to the root cause before a decision can be made. It is those problems and those decisions which require a competent manager.”

Not Sam’s Problem

“What has to happen in the next two hours that will indicate time well spent,” Sam asked. Each person looked around at each of the other members of this management team, then looked down and began to write.

It was not Sam’s intention to figure out the solution to this problem. It was Sam’s intention to have the group figure out the solution to this problem.

The responses from the team were positive.

  • We have to agree on the purpose. We have to agree on what we are trying to achieve. We have to agree on the goal.
  • We have to agree on what actions we will take. We have to agree on the coordination and interdependencies of those actions. This has to be a period of cooperation.
  • We have to agree on what results we are looking for. We have to agree on what measures we will collect and analyze. We have to agree to raise the flag when something doesn’t look right, not to bury our statistics in a warehouse.

Most importantly, this was no longer Sam’s problem. This problem now belonged to the group. -TF

Hidden Over-Production

The good news was that we had stumbled on the problem early. Sam arrived in Corina’s office about two minutes after the phone call.

“I thought something was up when I was down here a couple of weeks ago,” he reported. “I figured there must have been some snafu in shipping that was causing a bottleneck, and I had some fires somewhere else, so I hoped that shipping would figure it out on their own.”

“We figured it out,” Corina chimed in. “We put the over-production in the Fifth Street Warehouse, so we could keep working around here.”

“But, I thought we sold the Fifth Street Warehouse,” Sam interrupted.

“Almost. But I talked to the Real Estate Department and they hadn’t had any serious offers, the listing had just expired and they were actually glad that we needed the space to put the inventory.”

Sam looked especially troubled. “Corina, I need you to gather the data, the real data on what we have in the warehouse, and your current production rates. We need to do some thinking about this. Let’s meet tomorrow at 10:00 in the conference room.”

PAR

Corina was puzzled. Her simple Cap Ex budget exercise that took her a week to prepare, now knowing it was a 15 month Time Span task, had caused her to think. That’s the point. Defining the Time Span of the task communicates the “real” complexity of the task. This was not a simple exercise. The Cap Ex budget is a complicated task and will require some deep thought, some research, some data gathering.

“Where do I start?” she asked.

“Do you remember my golf analogy?” I replied.

“You mean PAR?”

I nodded.

“P stands for Purpose, A stands for Action, R stands for Results. First I have to define the Purpose?”

I nodded again. “We cannot go any further until we define the purpose. What is the purpose of the organization?”

“The organization?” she leaned back. “But I just run the plant floor?”

“But if you just think about the plant floor, you will make wrong decisions. What is the purpose of the organization?” -TF

Allocation of Your Most Precious Resource

“Looking at the future,” Glen contended, “we are desperately looking for that new something that is going to help replace some our declining lines of business. We find something, we gear up for it, commit some people to the project, but so far, all of those projects have failed. We end up pulling the plug.”

“Who have you committed to these new projects?” I asked.

“Well, they are new projects, so we generally take those people that we can spare from our core project lines.”

“Are these your best and brightest people?”

“Well, no. Our best people are still running our core projects. But we can usually spare a couple of people from one of their teams.”

“So, you are trying to cobble together a launch team, in an untried project area, where unforeseen problems have to be detected and corrected, and you are doing this with spares?”

Decision Tree

Gregory St. Germain sits in Broward County jail because of a Decision Tree. At the city commission meeting, last night, in addition to an official commendation, my wife received more than one stern warning about citizens confronting criminals. (Link to story at the bottom of this post).

People ask me what my wife was thinking? She used a Decision Tree. In a split second, she reviewed these questions.

  • How large is the intruder? Is he bigger than me?
  • Is he moving toward me or away from me?
  • What is his mental state? Aggression? Or fear?
  • Does he show any signs of a weapon?

In a split second, the answer to all those questions was NO. The Decision Tree gave my wife the confidence (and poise) to give chase, pull the intruder off the fence and put his face in the dirt.

If the answer to any of those questions had been different, it would have changed her response.

Decision Trees can be valuable in making quick decisions, but only if you plan them in advance and train to them. Police officers and EMTs use Decision Trees all the time to govern their behavior. Managers can do the same.

Most management circumstances can be anticipated. Decision Trees can be explored in advance. Given a situation in your company, you and your team can be trained in the discipline of a Decision Tree.

How will your team respond? -TF

If you missed the story, here is the CNN link.