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Structured Decision Making

 

Structured Decision Making briefly explained

Definition

Structured Decision Making is an organized approach to identifying and evaluating alternatives that engages stakeholders, experts and decision makers in productive decision-oriented analysis and dialogue and deals proactively with complexity and judgment in decision making.

Benefits

Rationalizing decision making through Structured Decision Making has the following benefits.

  • Quality and Defensibility

  • Transparency and Accountability

  • Efficiency

  • Relationship Building

  • Learning and Capacity Building

  • On-ground Results

 

Structured Decision Making Process

Process steps explained

1. Clarify the Decision Context

Clarify what decision is being made, why and within what scope. Establish roles and responsibilities. Identify the constraints within which the decision will be made.

2. Define Objectives

Seek out interest-based objectives. Expect objectives to be mutually contradictory. Objectives always have a preferred direction.

3. Define Evaluation Criteria

Evaluation criteria are required for comparing alternatives. Each of the lowest-level objectives needs an evaluation criterion.

4. Develop Alternatives

You must orient your group to the problem. Specify what matters in the decision. Decide how potential solutions can achieve the objectives. Create a variety of alternatives for decision makers to consider.

5. Estimate consequences

Estimate each alternative in terms of the evaluation criteria. Represent consequences BEFORE considering preferred alternatives. Consequence table illustrates the consequences of each alternatives.

6. Evaluate trade-offs and select

Find ‘win-wins’ and highlight trade-offs between alternatives. The selection should be logged including the reasons why.

7. Implement

As decisions are implemented, some of the uncertainties inherent in the analysis will be resolved. Because of this, it is important to continually assess the outcome of the decision.

Why do we need this now?

  • Reduce complexity and uncertainty

  • Rapidly changing business context

  • Coping with high stakes

  • Limited resources

  • Need to take calculated risks

 

Which tools can support us?

  • Process Mining Techniques

  • Use a Desicision Databases with open, scraped and internal data

  • Simulation using Decision Trees

  • Use Statistical Techniques and Algorithms

  • Use Interactive Dashboards

 

Biases that cloud our judgement

Availability heuristic

The misconception that events that are more easily brought to mind, are more likely to occur.

Anchoring

People take a piece of known information and extrapolate that to estimate an unknown quantity.

Risk aversion

People generally prefer avoiding a loss over making a gain.

Confirmation bias

People tend to favor information that confirms their preconceptions.

Optimism bias

The demonstrated systematic tendency to be overly optimistic about the outcome of planned actions.

 

Decisive Facts