© Henley KM Forum 2010 www.henley.reading.ac.uk
Knowledge Management Forum
Improving organisational decision makingDr Christine van Winkelen
Henley Business School
© 2011 Henley KM Forum
Plan for this session• Putting a focus on
decision making• The investigation• Framework to build
decision making capability
• Using the maturity model
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In a time of cutbacks, reprioritising focus areas.
How best to downsize a department.
Prioritising access to limited resources in an organisation.
Creating a regional structure for the organisation.
Merging with another organisation.
Renegotiating a major contract with a key supplier.
Changing a process so that adaptability is built in.
“Joining up” expertise in a specific area across a distributed organisation.
Formulating the company’s climate change policy3
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“We are told over and over again, that if anything is central to the new, global information economy it is knowledge…. One of the most critical question any organization can raise is “How do we decide what we should use in order to decide?”” (Mitroff 2008)
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What is a “good” decision?
A “decision” is a commitment to a course of action that is intended to yield results that are satisfying for specified individuals. (Yates and
Tschirhart 2006, p422).
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Adopting a capability-based approach to decision-making
Our objective: Identify factors that will enable managers to help build decision-making capability in their organizations as the internal and external environment evolves. 6
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Human decision making
• We adopt heuristics to speed up decision making, but these create traps. A large number of cognitive and emotional biases have been identified – mitigating the risks of these biases involves improving access to knowledge or increasing individual or organisational reflection. (Tetlock, 1991) (Hammond, 2006)
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• Flawed people with incomplete information seek to make good enough decisions through negotiation with others. (Cyert and March 1963)
• The organisational environment influences responses – highly turbulent environments can mean that decision traps potentially have an even greater effect. (Eisenhardt 1999)
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The context for decision making
Decision making context
Characteristic Decision making
approach in this domain
Indicative contributors to effective decision making
Simple Clear cause and effect relationships are evident. Right answers exist.
Best practice
Decision support technology systems and processes.
Complicated
Cause and effect relationships can be discovered. Expert diagnosis is required and more than one right answer is possible.
Expertise Using experts effectively. Developing expertise. Technology based expert systems.
Complex There are no right answers, but emergent and instructive patterns can be seen in retrospect. Efforts need to be made to probe the situation and sense what is happening to find the patterns of relationships.
Emergence
Considering multiple perspectives, including using new collaboration technologies, collective learning about decision making in this context.
Chaotic The relationships between cause and effect are impossible to determine: no manageable patterns exist.
Rapid response
Acting to establish order is needed through directive leadership.
8(Categorisation: Snowden and Boone, 2007)
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The investigation• Extensive literature review to create the
framework of five factors. • Exploratory research: interviews with 19
senior decision-makers in ten public and private sector organisations, exploring a significant decision with each and considering how these factors were enacted.
• A maturity model for the factors was created using focus groups of knowledge managers. This was tested through interviews with knowledge managers in nine further organisations.
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Working Group• Tim Andrews Stretch Learning• Noelle Brelsford PHSO• David Bruce British Council• Roger Darby Cranfield University• Mollie Dickenson Henley Business School• Susan Frost Ministry of Defence• John Haskey/ Mark Field DCSF• Alex Goodall Friend of the Forum• Sindy Grewal Audit Commission (Co-champion)• Anna Last Information Centre for Health and Social Care• Professor Jane McKenzie Henley Business School (Co-champion)• Dr Christine van Winkelen Henley Business School (Co-champion)• Darryn Warner Balfour Beatty
The organisations who contributed to the interviews:
From the public sector: Audit Commission, HMRC, Ministry of Defence,
Foreign & Commonwealth Office, National College
From the private sector: Mills & Reeve, MWH, Permira, Qatar Gas, Syngenta
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Human capital
Identifying experts and developing expertise
Developing individual’s decision making capacity by supporting reflective practice
Structural capital
Using technology to structure, integrate and provide access to explicit knowledge resources
Decision review process to learn about better decision making
Relational capital
Adopting an integrated approach to internal and external collaboration
A framework for building organisational decision-making capability
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KM factors Most significant contributions
Identifying experts and developing expertise
Decision making in complicated situations. Sense-making and identifying options.
Supporting reflective practice for individual learning
Managing cognitive bias, increasing range and depth of experience, increasing debate, challenge and openness. Developing expertise. Reflection on practice and self‑awareness to develop strategic decision making skills.
Human capital
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Important KM factors
Most significant contributions
Using technology to structure, integrate and provide access to explicit knowledge resources
Access to current and well-structured explicit knowledge to provide input for simple decision making. Support expert decision making. Support data collection and selection phases of complex decision making.
Developing decision review processes for organisational learning
Recognising different kinds of decision- making situations. Investing in the development of an appropriate repertoire of decision-making modes to suit the context.
Structural capital
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Important KM factors
Most significant contributions
Adopting an integrated approach to internal and external collaboration
Gathering intelligence. Accessing multiple perspectives to formulate the decision to be made in complex contexts. Making connections to create knowledge to generate new options.
Relational capital
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Constructing a maturity modelFactor
Level
Using experts Using technology
Using internal and external collaboration
Organisational learning
about decision making
Developing individuals as
decision makers
Ambient
Accepted
Applied
Ad-Hoc
Aware
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Different organisations place named post-itson their current capability level.
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Use colour to reveal the “river” – the gap between the “banks” is the learning opportunity.
AB A
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See “Learning to Fly” by Collison and Parcellfor more details of this approach.
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Identify opportunities for peer learning
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Contact details
This work was carried out as part of the research agenda of the Henley Knowledge Management Forum based at Henley Management College in the UK.
www.henleymc.ac.uk/kmforum
For further information contact:
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