Effective Problem Solving and Decision Making Process

Posted on Apr 3, 2025 in International Business Economics

Problem Solving Defined

Problem solving refers to the activities undertaken to find and implement a course of action to resolve an issue.

Decision-Making Defined

Decision-making is the process used to choose a course of action. It includes activities such as:

  • Problem identification
  • Problem definition
  • Diagnosis
  • Generation of alternative solutions

Choice Making Defined

Choice making is the specific activity of selecting one alternative from a set of available options.

Key Steps in Problem Solving (Part 1)

  1. Problem Identification and Situational Analysis

    Focus on addressing the key tasks in the correct order and using appropriate methods.

  2. Analysis and Formulation of the Problem
    • Description of the problem and its formulation.
    • Determination of the causes of the problem.
    • Definition of the objectives for problem-solving (troubleshooting).

Phases of Problem Finding

  1. Problem Identification: A decision-maker recognizes that a problem or an opportunity for decision-making exists.
  2. Problem Acceptance: The decision-maker focuses attention on the problem rather than ignoring it.
  3. Problem Representation: An improved understanding of the problem is achieved, allowing consideration of alternatives for problem-solving.
    • Reactive versus proactive problem finding
    • The role of perception, memory, and attention
    • The influence of goals, values, and needs

Causal Analysis Process

  1. Problem Description: Identification and location of the object, timing, and scoping of the problem.
  2. Definition of Specific Features: Answering questions like What? Where? When? How much?
  3. Specification of Changes: Identifying likely causes of the problem based on observed changes.
  4. Testing and Verification: Confirming the identified causes of the problem.

Key Steps in Problem Solving (Part 2)

  1. Generate Alternative Solutions: Activities focused on creating potential courses of action.
  2. Choose Among Alternative Solutions: Activities involving the evaluation and selection from the generated alternatives.
  3. Implement the Chosen Alternative: Activities required to put the selected solution into action.
  4. Control the Solution Program: Activities involving maintaining, monitoring, and reviewing the implemented solution.

Generating Alternative Solutions

Identify actions to reduce or eliminate the difference between the actual situation and the desired one. Be aware of effectiveness-reducing behaviors – the common tendencies include:

  • Focusing on the alternative-evaluation process rather than the alternative-generation process. The effort to generate alternatives and evaluate already identified alternatives are often not adequately separated (techniques like brainstorming can help prevent this).
  • A tendency to isolate alternatives rather than considering them in combination or sequence.
  • A tendency towards rigidity in problem solving, sticking to familiar patterns.
  • A tendency to impose self-imposed constraints that unnecessarily limit options.

Choosing Alternatives: Choice Making

Key considerations and common situations include:

  • A tendency to be unsystematic in the use of decision-relevant information.
  • Conspicuous-Alternative Situation: It is typical to accept the most readily available alternative. Compare the potential benefits (often small) against the costs (potentially high) of searching for better options.
  • Multiple-Alternative Situation: The number of alternatives and the quality of the final solution are important. The benefits from choosing the best alternative are often large, justifying a systematic choice-making process.
  • Designed-Solution Situation: No readily acceptable solution exists. Options include:
    • Lowering aspirations or minimum requirements.
    • Continuing the search for alternatives.
    • Attempting to design a new, acceptable alternative where quality is crucial.
  • Looping back to a previous phase may be necessary if additional information reveals aspects of the original problem that should have influenced the choice of alternative solutions.

Implementing the Chosen Solution

This involves planning and enacting the necessary activities so the chosen solution can effectively solve the problem. Common pitfalls include:

  • The tendency not to ensure clear understanding of what needs to be done.
  • The tendency not to ensure acceptance or motivation for the required actions.
  • The tendency not to provide appropriate resources for implementation.
  • Remember: The quality of a decision is fundamentally linked to its implementability.

Controlling the Solution Program

Compare what actually happens to what was intended, and compare the actual goal achieved with the desired goal. When there is a significant difference between the actual and desired situations, a new problem exists, and the problem-solving process begins again. Common issues include:

  • The tendency not to provide in advance for the information necessary to monitor the solution program effectively.
  • The tendency not to develop contingency plans in advance for anticipatable problems during implementation or operation.