Technological advances made during the late 20th century have led to a mass of information being generated.
At present, every two days there Is more Information being generated than there was between the dawn of time and 2003. With this ease of access comes a greater demand for Information, In a sense the more we have, the more we want. This essay will argue that despite the availability and the speed of which information can be obtained, it is still possible for good managers to make bad decisions.In a lot of cases, decisions in business do not have a black or white answer, rather varying degrees of grey with the outcomes falling on a scale between worst and best outcome.
Experience plays a key role In making decisions under pressure from time constraints which can result In Insufficient Information or not enough time to filter Information, also known as information overload. This can be overwhelming until confidence can be built in these situations. However, as experience builds, it is also important that a manager does not allow their personal bias affect their Judgment.Bias from previous experiences affecting the decision making process Experience is a double edged sword.
While making decisions In difficult situations can become easier with experience, It can also create personal biases which need to be carefully managed to continue to make effective decisions. Personal bias can be as a result of defending a previous decision, personal attachment or a vendetta (Campbell, Finniest & Whitehead, 2009). While these may seem insignificant when making a decision, there can be consequences to not recognizing when these biases present themselves.Defending previous decisions can lead to hard decisions being postponed.
While a decision made based on Information available at the time may have been the correct decision, over time the expected outcome may not have been achieved. While the decision was and is still a good decision, exploring different avenues may lead to a better outcome. Even though this may be a good strategic decision, it may be difficult to accept that our original decision has not worked out as expected. When business decisions need to be made, personal attachment can affect the decision making in cost levels of business.
When hiring a new team member, managers often seek out candidates which they can form personal friendships with (Lucas, 2013). While this may seem reasonable to ensure a cultural fit with the organization, it may result in someone better suited for the position being overlooked. The same holds true for promotion of staff inside the business if a manager does not want to lose the staff member, regardless of how well suited the person is for the new role. While we have discussed personal affection affecting the decision making process, the opposite Is also true.Letting a vendetta play a role In the decision making process can result without considering them on their merits.
One of the best examples of a vendetta both affecting and not affecting a business is technology giant, Apple. In his biography released after his death, it was revealed that former Apple CEO Steve Jobs declared "l will spend my last dying breath if I need to, and I will spend every penny of Apple's $40 billion in the bank, to right this wrong. I'm going to destroy Android, because it's a stolen product. I'm willing to go thermonuclear war on this.
" (Occasions, W. , 2011).This has led to numerous court cases between Apple and other hardware manufacturers using Android on their devices, most notably Samsung Electronics. Even though Apple and Samsung are fighting numerous court battles over their patents, including seeking sales bans in some countries, Samsung Electronics still remains a major supplier of components to Apple. However Apple isn't perfect when it comes to not letting a vendetta affect its business decisions. When Apple updated its operating system to ISO 6 for its Pod, Phone and Pad range of products, it removed Google Maps as a built in application, replacing it with Apple Maps.
This led to numerous customer complaints claiming that Apple maps were inferior to Google Maps and contained incorrect information. Such were the level of complaints that an acknowledgment of Apple Maps shortcomings was issued with an apology from Apple CEO Tim Cook. Another form of bias stems from our previous experiences. As experience comes as a result of repetition of similar processes and experiences, we tend to rely on these previous experiences when faced with making a similar decision. In these situations, it can be easy to overlook any subtle differences which can affect the outcome of the decision.While it is human nature to have biases, it is important to recognize and manage these biases to ensure the best outcomes are achieved from our decisions.
Information Overload When it comes to information overload, we automatically think of the volume of information. We now generate so much information that every two days there is more information created than all information generated prior to 2003 Jackson & Profaner, 2012). This is not a new problem, with examples being documented from the 19th century. In 1810, there were only 18 volumes of case law.By 1845, this had grown to 800.
By 1885, there were nearly 1800 volumes. The 21st century has seen a similar explosion of information, with the growth of Twitter. The number of tweets in June 2009 was only 2 million growing to 65 million in June 2010 before growing again to an average of 200 million tweets in June 2011 . However there is more to information overload than Just the volume of information. There are a range of factors involved when it comes to information overload.
Jackson and Profaner (2012) categories these into direct and indirect effects of information overload.Direct effects With so much information available, it could easily be assumed that we would have al the information required for making a decision and achieving the best outcome. However, there are limits to the amount of information that we are able to process. Like a computer, there is a limit to how quickly we are able to absorb information. This then conflicts against how much information is available and is required to be processed before a deadline. Outside of making business decisions, the best example of this is studying for an exam at the last minute.
While we may have some control over the direct effects, we have less control over the indirect effects of processing information. The quality of the information can reduce the time required to process the information as well as reducing information required while the characteristics of the information can also have a large effect, in that the information received may be duplicated numerous times or may not be written at the right knowledge level I. E. What an experienced manager can understand, a new manager would not.
This also blends with other personal factors such as motivation. The task outline can have an impact as well, in that the more complex the task, the more information is required to be processed in the time Ramee. Information overload is also experienced when considering hiring a new staff member. As Lucas (2012) discussed in his article, managers apply less weightings in the hiring process to education than to personality or experience.
This is because the majority of applicants have received qualifications from prestigious universities and colleges.Time Constraints and availability of information When faced with a deadline, we tend to modify the way we work to fit in with the deadline (Mauled, Hockey, & Boatload, 2000). This could be reviewing and processing the available information at a faster pace or being more selective in filtering the available information. However, while this may seem the logical process when under pressure from time constraints, it can become easy to miss important information which could have had an impact on the end decision.
Shoehorning, Davidson, Poole, Simon, Woods, & Chaw (2010, p. 1) discuss three environments for the decision making process. These are the certain environment, the risk environment and the uncertain environment. As the name suggests, the certain environment has all the alternatives and outcomes defined. While this is the ideal working environment for managers, this is not the case in the majority of situations. The risk environment is the more common environment.
While the alternatives are known, the outcomes are only known as probabilities. This makes the decision making process more complicated but not overly so.Working in an uncertain environment means not knowing all the alternatives or outcomes, even as probabilities. This is the most challenging environment and requires creativity to be able to problem solve and reach an outcome.
Working in as a team can be beneficial when in an uncertain environment. While reviewing, processing and filtering information can help speed the decision making process when there is sufficient information, time constraints can often lead to decisions being made based on insufficient information. In conclusion Like most things in business, experience makes the decision making process easier.The difficulty of the decisions needed to be made increase with the responsibilities of the position held in the company structure. While team members will generally work in a certain environment, managers will mostly work in the risk environment and senior managers in the uncertain environment.
At the same time, controlling the flow of information can present its own challenges. Having too much information can at times be worse than not having enough information as we cannot process all the Filtering the information can help but runs the risk of overlooking something important.While experience helps in the decision making process, it can also create a personal bias which can impact on our decision making process. Whether we are defending our decisions, swayed by our previous experiences or Just have an axe to grind, taking a step back can help in dealing with our own bias. In the end, with so any factors at play in the decision making process, it is easy to see how even good managers can sometimes make a bad decision.
Part B My decision making process is generally analytical.As I work for a finance company within the Superannuation industry, any decision I am involved with not only needs to be within company guidelines, it also needs to comply with Government regulation. Working inside a highly regulated environment, I feel it is a benefit to be analytical when it comes to making decisions. When a decision needs to be made, it is generally around a process within the team.
Where the decision may seem to have a logical answer in that it saves the team member time, it is not always black and white.I will weigh the benefits of the process change against any impact to clients, while ensuring that the change will still comply with Government regulations. It is also important to investigate how hard the process change is to implement as this could prevent the change being implemented. While this works well when making basic decisions, when there is no clear outcome, I will engage a colleague to discuss the problem with. This will generally result in a detailed discussion where we will less out the possible outcomes on the way to arriving at an agreed decision.After explaining the problem, the discussion revolves around the impact to the client and team members, what we believe is the best solution, does the solution comply with Government regulations and what is involved in implementing the best solution.
While these discussions can become heated, it doesn't become personal. This allows for ideas to be challenged which can lead to identifying undesirable impacts of both the problem as well as the solution before the decision is made.A further benefit of aging a decision in this manner is it allows for a united front to be presented when the decision made is not the desired outcome.
