Information Technology Reference
In-Depth Information
Decision Making as a Component of Problem Solving
In business, one of the highest compliments you can receive is to be recognized by your
colleagues and peers as a “real problem solver.” Problem solving is a critical activity for any
business organization. After identifying a problem, the process of solving the problem be-
gins with decision making. A well-known model developed by Herbert Simon divides the
decision-making phase
of the problem-solving process into three stages: intelligence, design,
and choice. This model was later incorporated by George Huber into an expanded model of
the entire problem-solving process (see Figure 10.1).
decision-making phase
The first part of problem solving,
including three stages: intelligence,
design, and choice.
Figure 10.1
Intelligence
How Decision Making Relates to
Problem Solving
The three stages of decision
making—intelligence, design, and
choice—are augmented by
implementation and monitoring to
result in problem solving.
Decision
making
Design
Choice
Problem
solving
Implementation
Monitoring
The first stage in the problem-solving process is the
intelligence stage
. During this stage,
you identify and define potential problems or opportunities. You also investigate resource
and environmental constraints. For example, if you were a Hawaiian farmer, during the
intelligence stage you would explore the possibilities of shipping tropical fruit from your farm
in Hawaii to stores in Michigan. The perishability of the fruit and the maximum price that
consumers in Michigan are willing to pay for the fruit are problem constraints.
In the
design stage
, you develop alternative solutions to the problem and evaluate their
feasibility. In the tropical fruit example, you would consider the alternative methods of ship-
ment, including the transportation times and costs associated with each. During this stage,
you might determine that shipment by freighter to California and then by truck to Michigan
is not feasible because the fruit would spoil.
The last stage of the decision-making phase, the
choice stage
, requires selecting a course
of action. In the tropical fruit example, you might select the method of shipping fruit by air
from your Hawaiian farm to Michigan as the solution. The choice stage would then conclude
with selection of an air carrier. As you will see later, various factors influence choice; the act
of choosing is not as simple as it might first appear.
Problem solving
includes and goes beyond decision making. It also includes the
implementation stage
, when the solution is put into effect. For example, if your decision
is to ship tropical fruit to Michigan as air freight using a specific carrier, implementation
involves informing your field staff of the new activity, getting the fruit to the airport, and
actually shipping the product to Michigan. As another example, the Operations Research
Group at British Airways used quantitative problem-solving techniques to help the airline
achieve better departure statistics for its 750 flights per day to about 130 destinations.
2
On-time departure is a complex task, involving the coordination of cabin crews, airline
intelligence stage
The first stage of decision making, in
which potential problems or oppor-
tunities are identified and defined.
design stage
The second stage of decision mak-
ing, in which alternative solutions to
the problem are developed.
choice stage
The third stage of decision making,
which requires selecting a course of
action.
problem solving
A process that goes beyond decision
making to include the implementa-
tion stage.
implementation stage
A stage of problem solving in which
a solution is put into effect.
