This paper discusses a good decision-making tool or technique, which would help generate success whether individually or in a team. There are a number of decision-making tools available, which would go with different situations. Nevertheless, the chosen tool would practically be very helpful in situations in general. This paper defines decision-making, states its importance, defines and explains the chosen tool and sites an application.
Introduction
According to (2006), decision-making is a cognitive process leading to a selection of a specific course of action among alternatives or choices. It usually starts when we need to do something but we do not know what, and produces a final choice called a decision. Therefore, this is a reasoning process, which can be rational or irrational, and which could be based on assumptions. It is practically what we do every minute, every hour and everyday, starting from what to eat in morning, whether going to work or not, deciding what to wear, or deciding whom to vote in an election, and many other examples.
Decision-making is said to be influenced by many different factors. According to and (2004) in the first chapter of their book, these factors include long history of experiences, personal behavior, and the environment. These factors mentioned were said to manipulate the strategies and the decision-making behavior of an individual. A concrete example that the authors gave was when planning a vacation, a person may make a detailed, logical analysis concerning where to go, and along the way, he or she may then use simple rules to decide when and where to stop, which specific routes to take, depending on incidental factors such as traffic. This process proves the fact that decision-making is constructed psychologically, as we can never physically see the decision but we can assume from observable behavior that a decision has been made.
Good decision-making is an essential skill for success in career in general and particularly in effective leadership. If we can learn to make timely and well-considered decisions, then we can often lead a team to spectacular and well-observed success. In contrast, if we make poor decisions, then the team risks failure and will automatically lead to the downfall of the team as a whole. A desired result from a specific problem depends on how a person or a team can come up with a perfect plan for their decision-making. To focus on a specific tool on decision-making, we must focus also on a specific problem encountered in most firms, and this is managing a team or a business properly to arrive at desired consequences. More often than not, the problem of a firm or a company revolves around money or profit and/or quality service. With this, a specific plan or strategy must be planned perfectly to defy the uprising problems and be used in upcoming situations.
Pareto Analysis
In existing firms, different managing teams and leaders have already encountered certain problems and solutions. Of course, it is a given fact that crises will be experienced along the way, so as these troubles come, certain solutions and approaches are made to combat the problem.
One of the decision-making tools is Pareto Analysis, which is a simple technique that helps you to choose the most effective changes to make. Technically, it uses the Pareto principle, which states that by doing 20% of work you can generate 80% of the advantage of doing the entire job, as stated (19 June, 2006, ). It is a formal technique for finding the changes that will give the biggest benefits, and useful where many possible courses of action are competing for your attention. You can apply this rule or principle whenever a choice has to be made among a number of alternative directions for action. This can be accomplished to uncover the possible sources of a particular problem, or after a brainstorming session to generate creative ideas in addressing a particular issue.
In using this decision-making tool or principle, you have to start listing down the changes you could make. If you have a long list, then you can group them into related change to score the items or groups correspondingly. The scoring method that you can use depends on the sort of problem you are trying to solve. For example, if you are trying to improve market profitability, then you would have to score options on the basis of the profit each group might generate. While if you are trying to improve customer satisfaction, your score should be based on the number of complaints eliminated by each change. The change that has the highest score is the first one to be focused on. If this happens then most probably this one will give you or your company the biggest benefit if you solve it. While the options with the lowest scores will possibly not even be worth bothering with, as solving them may cost you more than the solutions are worth. As for more organized solutions and while discussing the matter to a team, you can use graphs such as line, bar, and pie graphs to illustrate your solution and give each factors corresponding scores.
To further illustrate and explain this concept, we can discuss a specific example. In a certain call center, one account suffers from a big loss in the number of effective calls per day. Due to this, the team leaders decided to evaluate the situation by dividing the whole account into different teams with different shifts to see the effectiveness of agents in making their calls. The team leaders identified the problems, listed them down and gave corresponding scores. The crisis arose primarily from the terrible internet connection the account has, which got 92%. Second, due to the many computer windows each agent opens to increase their call, it causes the delay of the other agents with one computer window only, for a score of 3%. Other problem includes individual internet problem (1%), assigned accounts problem (1%) and computer breakdown (3%). The factor that got the highest score was the internet connection so it was provided a solution right away. To solve these given problems, the account decided to have the connection repaired and made sure that the internet connection will be secured for the benefit of each agent. For the second problem, the computers of each agent were monitored to make sure that only one computer window will be available for each agent. During the successive months, the effective calls of each call center agent increased and the team leaders where glad because of the good news. This is just a simple example of how the problem was solved using the Pareto Rule or Analysis. However, the results are not accomplished immediately, and time is needed for the company to attain the desired consequence.
Practically speaking, the application and use of this technique is extensive. It can be used to evaluate certain situations, whether it is an easy or a difficult one. This means that the use of this technique is limitless and it is not user-specific. Using this decision-making technique will save time in looking for alternative solutions to problems and will give better understanding to team mates or employees about certain problems that they have to face.
Conclusion
The Pareto Analysis is a simple decision-making technique that helps you to identify the most important problem to solve, and gives you a score showing how severe the problem is. By focusing on the problem, the company is able to find and plan effective solutions and not waste anymore time going around the crisis. Due to the fact that different problems entail different solutions, it would be easier if the most severe problem will be given more attention that the others. Given the information that different factors influence our decision-making, it is never surprising that there are times when certain decisions are made according to our emotions. Nevertheless, whether a decision made was rational or not, still it is manipulated by our desire to give a possible solution to a problem.
Based on past and repeated experiences, simple rules in decision-making may become applicable that result in successful decisions. In this case, the decision-maker tends to concentrate either on the values of the attributes for each option or the advice provided by a rule, as was explained by (2004). Furthermore, authors also explained that in making choices, whether it resulted in a good or poor choice, it produces a feedback and this feedback forms the basis for rule learning. This is actually why we can apply the same solutions to same problems as we already experienced it before, and learn from all the succeeding trials that follow. The authors also mentioned that as the environment changes, the earlier rules in decision-making may no longer suffice, and the deliberative process starts all over again.
In line with these, to help a company or an individual combat the challenges in making a difficult decision, different decision-making tools were invented to practically help the persons in need of this kind of assistance, as they can help reduce the risk of human errors due to impulsive decision-making and lack of experience. In considering the implications of various courses of thinking, it is now just up to us whether to maximize the use of these decision-making tools and putting it to its proper application.
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