As a Project Manager, I make decisions every day that has significant impact on the success of my business. Analysis of business problems has been a key learning for me during the Executive MBA program of Lagos Business School.
It is relevant because as a leader, I need to make decisions and solve the problems. The difference between a good and bad decision is the way the decision is taken. Like many things in life, it is important to learn the principle that guides how right decisions are made. David Garwin said “Decision making is the process fraught with power plays, politics, personal nuances and institutional history. Leaders who recognize this make far better decisions than those who persevere in the fantasy that decisions are events they alone control”. The “Analysis of Business Problems” course has been a practical step to improve my decision outcomes, problem solving capacity and business management skills.
I learnt to use the ProACT decision making model. This model provides a structured approach to decision making.
ProACT comprises of eight elements Problem, objectives, Alternatives, Consequences and Tradeoffs.
Step 1- Identify the problem. Before a problem can be identified the situation needs to be understood. This is the first step in decision making before the model can be applied. This means clearly identifying and collecting relevant information on What, Why, When, How, Where and Who is involved in the situation.
Step 2 – Identify and define the problem. Finding the right problem is critical to making good decisions. A guide in defining the problem could be asking the question “What has changed? Do not confuse the symptoms with the problem. The problem is like a disease, for example when one has Malaria, the symptoms are fever, headache and perhaps cold. treating the symptoms would not result in solving the problem. In a business, the problem could be lack of motivation among staff and this could be as a result from frequent changes in management and lack of a clear path for career growth.
Step 3 -Define the objectives. By asking the question “What does good look like? The objective can be clearly defining. The objective is also the goal. This step is very important because it determines which option will be selected.
Step 4- Generate alternatives. The alternatives are the decision option. Sometimes brainstorming with a group of people helps to identify decision options. Two good heads are better than one, so you want the right set of people in the room when selecting the alternatives. If it is a multi-disciplinary problem, then you need the right experts/professionals in the room to suggest alternatives. At this stage it’s important to think widely what the possible alternatives are to solving the identified problem.
Step 5 – Identify the consequences. Define what the consequence of each alternative are in a tabular form to aid pairwise comparison. The consequence table shows the risk and the consequence of taking that decision. These consequences are evaluated against the objective and defined criteria.
Step 6 – Clarify the tradeoffs.
For more details on the ProACT model, see here