Harvard Business Review on Decision Making

by John S. Hammond

Book Overview

Decision making is a perennial issue that managers face not only in their professional lives but also in their private lives. HBR has published several articles on this subject by such people as... This description may be from another edition of this product.

• Format: Paperback
• Language: English
• ISBN: 1578515572
• ISBN13: 9781578515578
• Release Date: June 2001
• Publisher: Harvard Business Review Press
• Length: 224 Pages
• Weight: 0.65 lbs.
• Dimensions: 0.6" x 5.5" x 8.2"

Customer Reviews

First, decide which decisions are most important rather than merely urgent.

Much of the contextual material in this volume is out-of-date, given the fact that the eight articles originally appeared in the Harvard Business Review years ago (1965-2001). However, I think the core concepts remain sound and provide a valuable frame-of-reference for understanding the advances in decision making that have occurred during the last five years. For example, Peter Drucker suggests a sequence of six steps: classify the problem, define it, identify possible answers, determine which is "right" rather than acceptable, build into the decision the action(s) necessary to implement it, and then test the decision's validity and effectiveness. Yes, these are obvious steps. However, but the number of well-publicized bad decisions that have been made in recent years (e.g. Adelphia Communications, Arthur Andersen, Enron, Kmart, and Tyco) suggests the implications and consequences when decision-makers ignore one or more of these steps. No brief commentary such as this can do full justice to the rigor and substance of the eight articles. It remains for each reader to examine the list to identify which subjects are of greatest interest to her or him. My own opinion is that all of the articles are first-rate. One of this volume's greatest benefits is derived from the fact that a variety of perspectives are provided by a number of different authorities on the same general subject. In this instance, "advances [to date] in strategy" Readers will especially appreciate the provision of an executive summary that precedes each article. They facilitate, indeed expedite frequent review of key points which - presumably - careful readers either underline or highlight. Also of interest is the "About the Contributors" section that includes suggestions of other sources to consult. Here are questions that suggest key issues to which the authors of these articles respond: How to make and then measure an "effective" decision? (Peter Drucker) Comment: Effective executives do not make a great many decisions. They concentrate on what is most important. What is a rational method for making trade-offs? (John S. Hammond, Ralph L. Keeney, and Howard Raiffa) Comment: Making wise trade-offs is one of the most important and difficult challenges in decision making. Needless to say, the more alternatives you are considering and the more objectives you're pursuing, the more trade-offs you'll need to make. Why is humility essential to effective decision-making? (Amitai Etzioni) Comment: Only fools make rigid decisions and decisions with no sense of overarching purpose, whereas the most able executives practice more humble decision making that offers the benefits of flexibility, caution, and the capacity to proceed with partial knowledge. What are the most common interpersonal barriers to decision making and how to overcome them? (Chris Argyris) Comment: One of the most common observations in company studies is that executives lack awareness of their own behavioral pat

Best Decision I've ever made

Don't let the title mislead you, this book won't make decisions for you. I will however, give you the ability to make use of your most powerful business tool: a convincing guess. Many times I would stumble blindly through the veil of uncertainty, only to arrive on the otherside; lost, confused, naked, and too sore to sit down. But, now, after digesting these powerful articles, I can make my way through uncertain times; clothed in conviction and sitting on a soft pillow of apathy.

Effective Decisions

Being an effective manager requires being a good-decision maker too, having ability of using factual and quantitative information to analyze what is the most efficient decision to reach a well-defined objective. Making good decision by applied management science approach is the benefits that managers expect to learn combining with past experience to decide on what should be done. However, in the real-reality (as opposed to virtual reality, as a model), many decisions can be made under the highest-level conceptual understanding. In addition, a better understanding of decision making can be broken down into six sequential steps according to Drucker (pp. 2-19) 1. Classifying the problem in order to tell if it should be solved based on either principles or pragmatic concept. The problem can be categorized in three groups. The first group is the generic problems; for example, in a manufacturing organization, it may happen the situation like total amount of products decreasing. At this stage, the product control or engineering group will look at what is going on in a production line. To illustrate, the coupling in the pipe carrying steam or hot liquids, rather than the problem of production processing. This kind of problems frequently happens. The second group is a unique problem for the individual institution. The third group is a truly unique problem which happens out of exception. The truly unique events are rare and have to be treated individually. Unlike truly unique events, the other two groups require a generic solution. They require a rule, a policy, or a principle. Once the right principle has been developed, all manifestations of the same generic situation can be handled pragmatically by adjusting the rules to each specific case. 2. Defining the problem. After classifying the problem is generic or unique, it is quite easy to define what the problem is about that we are dealing with. However, it is the most important part of the whole decision process because sometimes the definition of the problem seems plausible but incomplete. In order to avoid this kind of carelessness, Peter F. Drucker suggested all of the decision makers check this process, defining the problem, again and again against all the observable facts and discard a definition the moment it fails to encompass any of them. 3. Specifying the answer to the problem to see if the decision is on the boundary conditions or not. A decision that does not satisfy the boundary condition is worse than the wrong definition of the problem. Therefore, before picking up the optimal solution, a decision maker has to deeply think about a question, "what are the objectives the decision has to reach?" Clearly thinking about the boundary conditions will help decision makers identify all of the possible decisions which can satisfy the needs. 4. Deciding what is right, rather than what is acceptable, in order to meet the boundary conditions. It means before paying attention on making decision acc

Theory and Practice - advice from the leading minds.

There are several books from the Harvard Business Review that follow this simple format - essays on critical topics by the leading minds in the field compiled into a short book of around 200 pages. One of these critical topics is Decision Making. That topic is the focus of this book.There are hundreds of books on management, strategy, leadership, etc. but not many are purely dedicated to treating the subject of Decision Making from a theoretical and abstract perspective. This book contains 8 short essays presenting different theories by people by Peter Drucker. The first chapter starts off with an impressive treatment of The Effective Decision. It is impressive because of the wisdom packed into these few pages and the aptness of the title. The author (Peter Drucker) dispels the myths about the most effective decision makers being the ones that can think fast and manipulate a large number of variables in their heads. Instead he explains that the best decision makers are the ones who focus on impact instead of technique. He then systematically explains a simple process to follow to achieve the same results as the highly successful executives. The book then moves on to topics dealing with how to make trade-offs, humble decision making (which is nothing but accepting that your first impressions may be wrong and be open to changing the direction of your thoughts as more information becomes available), interpersonal barriers, hidden traps, when to trust your gut, and analyzing problems. The essay on interpersonal barriers was very familiar to me as I had experienced the situations described several times in my own career.The book is simple - it has no pictures, just some tables once in a while and some blank paper at the end of the book to takes notes. The size is small like a novel but very potent! When I first saw this book at a bookstore, I didn't think much of it. But I picked it up because of the Harvard Business Review name on the front cover. I couldn't put it down once I started reading the first chapter and immediately purchased a few books in this series. These books and especially this one can be described in only one word - potent. They are like text books or Ph.D papers except they are very practical. These are some of my favorite management/business books but they are difficult to digest. Since they are abstract in nature, one has to read them very slowly and read them with total concentration. The authors don't spend time painting a picture in detail and trying to get you excited. They get straight to the point and finish it in less than 20 pages. If you read these books like you would read other books, you are likely to miss the point. This book in particular is very unique as there aren't that many books dedicated to just Decision Making. Enjoy learning from the masters! Good luck!