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2011 ECC International PROBLEM SOLVING & DECISION MAKING

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2011 ECC International At the end of the training, participants are expected to: Understand how to use an innovative yet structured process-based problem solving approach in practical scenarios. Recognize how to take informed decisions and calculated risks. Learning Objectives

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2011 ECC International PROBLEM SOLVING & DECISION MAKING Module 3

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2011 ECC International There are no big problems, there are just a lot of little problems - Henry Ford

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2011 ECC International PROBLEM SOLVING MODELS/ METHODOLOGIES Section 1

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2011 ECC International What is problem solving? Problem solving is a higher order thinking process aimed at improving performance or solving impending problems in any aspect of life. It requires the modulation and control of more routine or fundamental skills with structured thinking and strong effort from a committed group Service Delivery Team Process Group Team Middle Management Project Sponsor Support Team

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2011 ECC International What is problem solving? Problem solving is often misunderstood Issues are confused as problems and problems are confused as causes IssueProblemCause Terminology is very critical before looking into the methods of problem solving

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2011 ECC International Issue Proposal to solve a problem Situation What a circumstance is Purpose What we want to do or what we want to be Problem Some portions of a situation that cannot realize purpose Problem Process with set of actions to attain the purpose / aim Solving Cause What brings about a problem Identifying the appropriate solution / problem solving calls for strong thinking pattern Problem Solving Terminology

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2011 ECC International Your Thoughts.. Team Building

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2011 ECC International STRATEGIC THINKING Judging based on whether a situation is focused or not remember Strategy is not necessarily strategic EMOTIONAL THINKING Judging based on the participants REALISTIC THINKING Starts from what one can do and fix the essential problems first EMPIRICAL THINKING Judging based on previous experience Thinking patterns

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2011 ECC International SYSTEMS THINKING Scientific problem solving approach utilizing system concept Purpose Input Result Output Function Inside cause Outside cause System based problem solving process Thinking patterns

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2011 ECC International Systems thinking brings structure into the problem solving approach It is based on system concept Clearly defines components and the boundaries of each one of them. Major components Purpose Input Output Function Causes (Inside / Outside) Result Systems Thinking

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2011 ECC International Structured problem solving approach Mainly applicable to product / process improvement through correction / elimination of problems Applies 8 timeless principles to solve problems Based on using a team approach rather than focusing on individuals 8D Methodology

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2011 ECC International Form Team Describe problem Containment Implement and Verify Interim actions Verify Corrective action Implement it Prevent recurrence Congratulate team Identify potential causes Select likely causes Is it root cause? Identify possible solution Y N 1 2 3 4 5 6 7 8 8D Methodology

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2011 ECC International Strong creative problem solving methodology Follows a systematic approach to solve problems against other Sisyphean tasks Always strives for ideal solutions by avoiding any compromises common with other methods Major advantage is its ability to by-pass / eliminate contradictions of the system by refusing trade-offs TRIZ Methodology

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2011 ECC International The Search for solution TRIZ Methodology

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2011 ECC International Using the best practices from all these methods problem solving and decision making can be carved out as a simple SOLVE methodology Similar to the DMAIC approach of SIX SIGMA S PECIFY O BSERVE & MEASURE ANA L YZE V ERIFY & CHOOSE E XECUTE & EVALUATE Hybrid PSDM Methodology

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2011 ECC International A problem well stated is a problem half solved - John Dewey

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2011 ECC International Break problems apart in a hierarchical form using a logic tree Start at 20,000 ft view and move progressively downward Logic tree diagrams can be drawn from a functional perspective (sales / research / accounting / operations) or from existing problem perspective Create and follow a structure for problem solving o Structure helps in gripping the issues rapidly o M.E.C.E (MUTUALLY EXCLUSIVE & COMPLETELY EXHAUSTIVE) o Do not try to reinvent the wheel Problem Framing

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2011 ECC International Business Needs No needs No problems !!! So identify business needs Business needs can usually be in several forms People Competency Market / Customer Financial Operational Identify Business Needs - SPECIFY

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2011 ECC International During FY 2005, the 1st Time Call Resolution Efficiency for New Customer Hardware Setup was 89%. This represents a gap of 8% from the targets @ 97% that amounts to US $2,000,000 of annualized cost impact. Problem Statement Example

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2011 ECC International Fill in the Blanks for Your Project: During ___________________________________, the ____________________ for (Period of time for baseline performance) (Primary business measure) ________________________ was _________________. (A key business process) (Baseline performance) This gap of ____________________________ (Business objective target vs. baseline) from ___________________ represents ____________________ of cost impact. (Business objective) (Cost impact of gap) Problem Statement Template

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2011 ECC International Structuring is only the first step. After breakup of the problems Develop a strong hypothesis Develop a strong hypothesis Using an initial hypothesis to a likely solution o Dramatically increase efficiency & effectiveness of decision making o Helps avoid potential blind alleys Proving or disproving a hypothesis is more effective than analyzing all available facts Problem Framing

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2011 ECC International Brainstorming can help in absorbing various facts and creating new ideas about the hypothesis Utilize all initial facts to generate hypothesis Identify and distinguish the facts o Helpful details or Mere numbers Bridge the gap Bridge the gap between the problem structure and hypothesis using issue maps / trees and further details Using an initial hypothesis dramatically increases efficiency and effectiveness of decision making Problem Framing

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2011 ECC International Data gathering throws a wide avenue for improvement in Organizations It is neither easy nor fun. But it can be made simple and painless Data Qualitative Quantitative OBSERVE & MEASURE Data Gathering

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2011 ECC International Data Qualitative Quantitative Brainstorming Research Interviewing Surveys Affinity Diagram Tally Sheets Check Sheets Quality Function Deployment Research Data Gathering Major Techniques

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2011 ECC International Select group of people with background in the process area Create the right mix in the group Solicit for ideas and moderate the discussion No idea is a bad idea Participate. Be Creative. Encourage wild and exaggerated ideas No criticisms allowed Data Gathering Qualitative

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2011 ECC International Remember o No idea is a bad idea o Participate o Be Creative. Encourage wild and exaggerated ideas o No criticisms allowed o Quantity counts more than quality at this stage o Build on the ideas provided by others o Evaluate ideas only at the end of the session Data Gathering Qualitative

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2011 ECC International Interviewing Tips Be prepared Interview in pairs LISTEN Dont Lead Use indirect approach Dont ask for too much Emphasize on preparation and courtesy Data Gathering Qualitative

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2011 ECC International Critical step where we prove or disprove the proposed hypothesis Interpretation of analysis is of two types 1. Understanding the data and piece it together 2. Assembling these findings into an externally directed end-product o This represents the course of action for the Organization There are a number of analysis tools to choose from to interpret the data It is critical to choose the solution that fits the particular problem Interpreting Results

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2011 ECC International Analysis Qualitative Quantitative Cause & Effect Diagram Affinity Diagram Flowchart Prioritization Matrix Pareto Chart Check Sheets Cost of Quality Control Chart Common Analyses for Interpretation

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2011 ECC International Commonly called Fishbone diagram (due to its appearance) or Ishikawa Diagram Extremely useful in organizing and systematically summarizing results and causes Effect Cause II Cause I Cause IVCause V Cause III ANALYZE Cause & Effect Diagram

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2011 ECC International 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 Cause & Effect Diagram Why?

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2011 ECC International 1.Clearly identify and define the problem, symptom, or effect for which the causes must be identified. 2.Place the problem or symptom being explored at the right, enclosed in a box. 3.Draw the central spine as a thick line pointing to it from the left. 4.Brainstorm to identify the "major categories" of possible causes (not less than 2 and normally not more than 6 or 7). If other applicable data such as check sheets are present, incorporate them as well. Cause & Effect Diagram How?

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2011 ECC International M aterials M other Nature M an M achine M ethods M easurement System Variation Major Categories

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2011 ECC International 5.Place each of the identified "major categories" of causes in a box or on the diagram and connect it to the central spine by a line 6.Within each "major category" ask, "Why does this condition exist?" 7.Continue to add clauses to each branch until the fishbone is completed. 8.Once all the bones have been completed, identify the likely, actionable Root Cause(s). Cause & Effect Diagram How?

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2011 ECC International Sample Cause & Effect Diagram

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2011 ECC International Named after Italian economist Vilfredo Pareto In any group of elements, a small number of elements determine most of the results. It is also known as the 80/20 rule e.g., 20% of the causes account for 80% of the problems. Concept of vital few-trivial many Pareto Chart

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2011 ECC International A vertical bar chart where bars represent the components of the total effect or problem Arranged in descending order according to their contribution to the total A Pareto Diagram allows data to be displayed as a bar chart and enables the main contributions to a problem to be highlighted. Pareto Chart

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2011 ECC International 1.Determine data classification items 2.Determine the check sheet items and collect data 3.Tabulate data for each classification item 4.Arrange data in ascending or descending order of occurrence frequency 5.Calculate cumulative frequency of occurrence against the causes and plot values a histogram 6.Use frequency on the y-axis and causes on the x-axis Constructing a Pareto Chart

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2011 ECC International CategoryFrequencyPercent of totalCumulative % Wrong dose10050 Wrong time703585 Wrong medicine157.592.5 Wrong patient8496.5 Medicine dc'd4298.5 Missed dose31.5100 Grand Total200100% 200 180 160 140 120 100 80 60 40 20 0 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Wrong dose Wrong time Wrong medicine Wrong patient Wrong dcd Missed dose Sample Pareto Chart

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2011 ECC International PROBLEM SOLVING STAGESTOOLS / TECHNIQUES Identify & select a process or problem Flow charts / Balanced Scorecard Interviews and surveys Data sheets Brainstorming & other consensus techniques Describe the problemData sheets Pareto charts Bar charts & Control charts Develop a broad perspective by identifying all possible causes Data sheets Brain storming Fish bone diagrams Develop a consensus on root causeData sheets & Pareto charts Correlation charts Brainstorming & other consensus techniques Create solution and action planBrainstorming, Control plan techniques Tools & Techniques Selection Guide

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2011 ECC International Once the data is interpreted into useful information through appropriate analysis, the next step is to o Present the results to the team / corresponding personnel o Get the buy-in of the team to implement the right solution This requires clear decision making strategy to be followed by the team Decision making however is a critical part of every single step in problem solving Let us look in some detail the process of effective decision making Next Steps

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2011 ECC International The problem is not that there are problems It is expecting otherwise and thinking that having problems is a problem. - Theodore Rubin

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2011 ECC International DECISION MAKING MODELS/ METHODOLOGIES Section 2

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2011 ECC International (Attitude/Style/Education/Experience) Leadership Competencies Organizational Leadership Levels Level 1: Lead Self Decision Making Communications (Verbal & Non-Verbal) Integrity Interpersonal Relations Five Leadership Specialized Skill Areas (SSAs) Buying & Selling Business Acumen Level 2: Lead Others Level 3: Lead Managers Level 4: Functional Leader Level 5: Business Leader Level 6: Group Leader Level 7: Senior Executive Leader 7 Levels of Organizational Leadership Mastery Importance of decision-making

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2011 ECC International (Decision Making Accuracy*) (Decision Making Time*) AccurateInaccurate QuickSlow/Long *Note: Accuracy is not proportionate/or necessarily related to time. Decision-Making Spectrums

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2011 ECC International Problem solving is concerned with overcoming obstacles in the path toward an objective and may or may not require action. A decision is an act requiring judgment that is translated into action. It is more comprehensive than problem solving They are interrelated but not interchangeable Decision Making Basics

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2011 ECC International Individual decision making Group decision makingOrganizational decision makingMetaorganizational decision making The Scope of Decision Making

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2011 ECC International Group Organization Metaorganization Individual Decisional Outputs (Actions transactions, outcomes) Decisional Inputs (Objectives, information, resources, energy) Permeable Boundaries Interactional Levels External Environment The Scope of Decision Making

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2011 ECC International Set objectives Follow-up & Control Find alternatives Implement decisions Compare & analyze alternatives Make the choice Revise objectives Renew search Revise / Update objectives Take necessary corrective action V ERIFY AND CHOOSE E XECUTE AND EVALUATE Decision Making Process

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2011 ECC International Set Objectives 1 Objectives constitute the foundation of effective decision making While making the right decision is the means the objective is the end Success of the decision making process lies in the measure of attaining the objectives Decision Making Process

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2011 ECC International Set SMART objectives S Specific M Measurable A Achievable R Realistic T Time-bound Decision Making Process

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2011 ECC International Find alternatives 2 Consider limitations of time and money Additional information follows the principle of increasing cost and decreasing value Start search in areas around the zone of cost effectiveness Decision Making Process

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2011 ECC International Cost of additional information Decision Making Process

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2011 ECC International Compare and Analyze Alternatives 3 All searches must lead to alternatives that must be properly analyzed Decision analysis or analysis of alternatives is critical to meeting the objectives Decision Analysis Resolution (DAR) is one of the International best practice methodologies used specifically for this purpose Decision Making Process

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2011 ECC International Decision Analysis needs to be applied when the decision is not straightforward or clear-cut when the impact of the decision is very high when there are many alternatives with apparently equal importance when there are several pros and cons and we need to arrive at the most optimum solution DAR When to use?

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2011 ECC International Decisions related to areas assessed as HIGH risk elements. Selection among reusable components, COTS or development Supplier selection To arrive at the most appropriate architecture or design technique Selection of a suitable life cycle model Decision on the levels, sequence and methodology of integration DAR Some Guidelines

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2011 ECC International PMI Methodology Pugh MatrixForce Field AnalysisDecision Trees Six Thinking Hats DAR Major Techniques

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2011 ECC International PMI stands for Plus / Minus / Implications Based on the weighing of pros and cons decision making method It takes into account the implications apart from the pros and cons PMI is extremely useful technique to validate / analyze the decision made Clearly indicates whether the chosen decision will have a positive improvement effect PMI Method

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2011 ECC International Identify the problem and gather possible alternatives / solutions Once the alternatives are identified we can analyze each one to find out if the decision would improve the condition or solve the problem Create a table with columns Positive, Negative & Implications Then list down the effects of the decision under each of these columns to the rightful place they belong Add relative scores to each of these effects (+) for positive impact () for negative impact (+) or () for the implications based on the effect Add up the scores to see the strength of the positive / negative impact An obvious decision must be reached at the end of this short exercise PMI Method How?

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2011 ECC International A young professional is deciding where to live. Her question is 'Should she move to the big city?' The PMI table below helps in making the right decision PlusMinusImplications More going on (+5)Have to sell house (-6)Easier to find new job? (+1) Easier to see friends (+5)More pollution (-3)Meet more people? (+2) Easier to get places (+3)Less space (-3)More difficult to get own work done? (-4) No countryside (-2) More difficult to get to work? (-4) +13-18 (+13) + (-18) + (-1) = -6 So here the choice is obvious!... PMI Method How?

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2011 ECC International 'Six Thinking Hats is used to look at decisions from a number of important perspectives It forces to move outside the habitual thinking style Helps to get a more rounded view of a situation In meetings it has the benefit of blocking the confrontations that happen when people with different thinking styles discuss the same problem Looking at a Decision From All Points of View Six Thinking Hats

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2011 ECC International Parallel Thinking A house from Four sides Parallel Vs Arguments Not categories of people These are directions, requests to think in a particular fashion Assumption that Mind can not focus on everything all at once The Six Thinking Hats Philosophy

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2011 ECC International Single use in a meeting Sequence Use in meeting s Any hat as often as needed Any number of Hats Any sequence Discipline is important Stay with the hat of the moment No Arguments please Using the Hats

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2011 ECC International More thorough, yet simple Time saving Removes Ego positions One thing at a time leads to more focused, better result producing thinking Put together the entire map, the route is obvious Not identify the route and the imagine the map Benefits

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2011 ECC International Intuitive Informative Constructive Cautious Creative Reflective Six Thinking Hats

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2011 ECC International What do you feel about the suggestion? What are your gut reactions? What intuitions do you have? Dont think too long or too hard. The Red Hat

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2011 ECC International The information seeking hat. What are the facts? What information is available? What is relevant? When wearing the white hat we are neutral in our thinking. The White Hat

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2011 ECC International The sunshine hat. It is positive and constructive. It is about effectiveness and getting a job done. What are the benefits, the advantages? The Yellow Hat

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2011 ECC International The caution hat. In black hat the thinker points out errors or pit-falls. What are the risks or dangers involved? Identifies difficulties and problems. The Black Hat

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2011 ECC International This is the creative mode of thinking. Green represents growth and movement. In green hat we look to new ideas and solutions. Lateral thinking wears a green hat. The Green Hat

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2011 ECC International The control hat, organising thinking itself. Sets the focus, calls for the use of other hats. Monitors and reflects on the thinking processes used. Blue is for planning. The Blue Hat

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2011 ECC International Deriving power from focused thinking Saving time Removing ego from decisions Doing one thing at a time Results of six hat thinking

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2011 ECC International Decision-making strategies Computational Judgmental Compromise Inspirational A Typology of Decisions

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2011 ECC International Decision categories Category I Routine, recurring, certainty with regard to the outcome Category II Non-routine, nonrecurring, uncertainty with regard to the outcome A Typology of Decisions

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2011 ECC International Decision combinations Category I / Computational strategy Category II / Judgmental strategy Top management makes Category II decisions. Operating management makes Category I decisions. Middle management supervises the making of Category I decisions and supports the making of Category II decisions. A Typology of Decisions

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2011 ECC International Category II Long-range organizational objectives Best choice from among a set of alternatives Decision involves organizational change Decision requires a commitment of resources Choice is a means to an end, not an end to itself Decision maker tends to overestimate success Success is measurable through objectives attainment Characteristics of Managerial Decisions

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2011 ECC International Concept of Decision-Making Strategies Knowledge about outcomePreference for outcome Strong preferenceWeak preference High-level knowledgeComputational decision making strategy Compromise decision making strategy Low-level knowledgeJudgmental decision- making strategy Inspirational decision making strategy

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2011 ECC International 4 Choice is mere culmination of the entire decision making process All results from the previous decision analysis must be appropriately applied to choose the right decision It makes better sense to collaborate with the team involved in order share ideas and choose the right alternative Making the choice

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2011 ECC International 5 Implementation / Rollout of the decision made is very critical Proper presentation of the decision decides the buy-in from the team Decision success is a function of its quality and implementation Decision Implementation

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2011 ECC International Success factorsDetractors Proper observation of operational constraints Disregard of risks involved Influence of decision makerLack of clear direction Involvement from implementersLack of proper coordination Lack of conflict of interestToo much additional information Decision Implementation

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2011 ECC International 6 Essential to ensure that implemented decision meets the objectives Performance measurement is made based on observing implemented decision in relation to the standard derived from the objective Involves corrective and preventive action implementation where necessary Follow-up and Control

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2011 ECC International Solve the problem that really exists NOT just the symptoms of a problem NOT the problem you already have a solution for NOT the problem you wish existed and NOT the problem someone else thinks exists.

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2011 ECC International If you do what youve always done, youll get what you always got! - W. Edwards Deming

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2011 ECC International END