Effective

Problem
Solving & Decision
M aking
 EFFECTIVE PROBLEM SOLVING AND DECISION
MAKING
Job Outcomes

Identifies and analyzes problems.

Uses sound reasoning to arrive at

c onc lusions. Finds alternative solutions to

c omplex problems.
Distinguishes between relevant and irrelevant
information to make logical judgments.

Develops new insights into situations and applies innovative solutions to make organizational
improvements.

Designs and implements new or cutting-edge programs and

processes. Exercises good judgment by making sound and well-

informed decisions.

Learning Objectives

Diagnose potential and actual problems.

Demonstrate the ability to identify the root causes of problems.

Use creative problem solving techniques to generate multiple solutions.

Evaluate alternative solutions and select the best one based on available

data.

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DEFINING PROBLEM SOLVING AND DECISION
MAKING

Definition of a Problem: A problem exists when there is a gap between what you expect to
happen and what actually happens.

 Problems must be resolved for organizations to function properly.

 Supervisors must be aware of current situations to recognize whether a problem exists.

Definition of Decision Making: Decision making is selecting a course of action from among
available alternatives.

 Process of analyzing c ritic al data to

determine the best de cision.

 We do not always select the best choice

when faced with alternatives.

 Need a rational, systematic, and effective

approac h for dec iding on a c ourse of
ac tion.

 Organization has limited resources (i.e.,

number of employees, time, money, etc .)
and those limits require managers and
supervisors to make c hoic es.

The Difference between Decision Making and Problem

Solving
While both processes are systematic
-> Problem solving involves defining a problem and creating solutions for it.
-> Decision making is selecting a course of action from among available alternatives. Problem
solving (Steps 1—4) always involves decision making (Step 3). However, not all decision making
involves solving a problem. For example, a supervisor may have to make decisions about
employees, resources, workload, etc. without having a problem to solve.

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 STEPS IN THE PROBLEM SOLVING
PROCESS

Four steps are involved in problem

solving:

1
Define the
Problem

2
Create Alternative
Solution Decision Making
s

3
Evaluate
alternatives
and select one

4
Implement and follow
up on the solution

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 Defining the
Problem
DEFINING THE
PROBLEM

1
Define the
Problem Diagnose a situation so that the focus is on the real problem, not
just on its symptoms. Symptoms become evident before the
problem does.

Separate fac t from opinion and speculation

Specify underlying causes

State the problem explicitly

Avoid stating the problem as disguised solution

Identify what standard is violated by the problem

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Defining the Problem

SELECTING THE RIGHT PROBLEMS TO DEFINE

As a practical matter, this means that most of the problems we face (and decisions we make)
are done in “one step” fashion. We use existing knowledge, experience and skill to address issues
that are usually similar to – but not identical – many of the problems, decisions and issues we
have faced over time.

If a problem-solver can handle 75% to 80% of the issues he or she faces using experience and
current knowledge, doing so allows the problem solver to address issues efficiently. Put another
way, there is not enough time nor energy to use a structured, time-consuming problem solving
process to address each and every problem faced over a working career.

Efficiency in Step 1/Define the Problem means using the 4-step problem solving process on the
right problems in the first place.

Two guidelines to help problem solvers “choose the right problems” to solve:

Spend time calculating data and defining problems to avoid working

to solve the wrong problem.

Do not overspend resources on small scale problems.

Causes of Problems
Common categories of problem causes include:

Materials Equipment and/or Methods and

tools procedures

Policies Other external Work goals/work

fac tors roles

Peopl
e

Problem solvers need not limit themselves to these categories. There may be more or fewer
categories, depending on the work group.

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 Defining the
Problem

DISTINGUISHING BETWEEN SYMPTOMS & CAUSES OF PROBLEMS

A useful tool to help problem solvers distinguish between symptoms and causes of problems is
using the “5 Whys” with your work group.

Ask “5 Whys”:

The First Why

 Pic k the symptom where you wish to start.

 Ask the first why: “Why is such-and-such taking place?”

 You will probably get 3 or 4 answers.

 Put the answers to the first why on some flip chart paper for all to see,
with plenty of spac e between them.

The Next Whys

 Repeat the process for every statement on the wall, asking why about each one.

 Record each answer near its parent (the “why” that it came from).

 Most likely, the answers will begin to converge—where 10 or 12 separate symptoms may
be traced back to the root cause.

 As the whys are traced back to their root causes, it may become clear that the problem
is not just a single event or a single person’s decision—it is larger than that and has
been around for quite a while.

 Avoid being distracted by blame-related answers—handle each answer by recording it

and saying, “OK, is that the only reason?”

To be most effective, the answers to the “5 Whys” must not blame individuals. No real change
occurs when blaming happens, and the root cause of the problem will still exist.

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 Defining the
Problem

FACTORS TO CONSIDER FOR PROBLEM SOLVING & DECISION MAKING

After accurately defining the problem, problem solvers should determine who should be involved in
the problem solving process. Problems solvers must decide how to decide. Even if the question
never comes up, a choice has still been made.

When determining who should be involved in the problem solving process, four situational
factors
should be c onsidered.

Situational fac tors

Time – The problem-solver must determine if there is enough time to use the work group as
par- ticipants in the process.

Information – Does the problem-solver have enough information to make a quality

decision alone?

Capability – Does the work group have the ability and willingness to be involved?

Group Acceptance – Is the group’s acceptance of the decision critical to

its implementation?

Notes

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Defining the
Problem

OPTIONS FOR PROBLEM SOLVING & DECISION MAKING

To decide the appropriate amount of group participation to use, supervisors/problem-solvers should
choose an appropriate problem solving/decision-making option. There are four main options for
problem-solving and decision making. The option chosen should match the situational factors
affecting the problem. Note that an organization’s culture and the work group’s climate might
emphasize or de-emphasize these fac tors and options.

The four dec ision-making options are:

 Option 1: Problem-solver decides alone.

“I’ll decide.” The problem-solver makes the decision alone and announces it
after the fact. An explanation of the reason for the decision may be given. This
option is also used when the supervisor has no choice or flexibility regarding the
problem to be solved—he/she is following orders and transmits the orders to
the work group.

 Option 2: Problem-solver consults the group and then decides alone.

“Let’s talk, then I’ll decide.” The problem-solver consults the group for
information and then makes the decision. Consulting the group could be done
all at once at a meeting, or one-on-one if necessary. Before implementing the
decision, the supervisor explains the rationale behind it, and attempts to
convince the work group of the benefits. The problem-solver may invite
questions and have a discussion.

 Option 3: Participative decision by group members and problem-solver.

“Let’s talk, then we’ll decide.” The problem-solver may present a tentative
decision to the group and ask for input. If the decision needs changing, it is
changed based on group participation and input. This option does not require
voting, yet voting is one way to use the participative option. Another way could
be that the group convinces the problem-solver of something, and he/she
makes changes based on that strong belief by the (capable) group.

 Option 4: Problem-solver lets someone else decide.

“You decide.” The problem-solver presents the situation to the group and
describes the criteria, resources, or outcomes limiting it. The group does the
problem solving and decision making. The problem-solver may join the group in
the process.

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 Create
Solutions

CREATE ALTERNATIVE
SOLUTIONS

2 Create Alternative
Once a problem has been defined, the next step is to create
alternative solutions.
Solutions

 Generating possible solutions is a c reative proc ess.

 Good alternative solutions take into account both short and long-term issues.

 To effectively create solutions, postpone the process of selecting any one

solution to the problem until Step 3.

If more than one person is involved in solving a

problem, alternatives can be proposed by all of those
involved. Using a group problem solving process
usually takes more time, but identifying the larger
variety of ideas that a group can create may be
worth the extra time.

A common problem with generating alternatives is the

tendency to evaluate the alternatives as they are
created. This tendency may lead to selecting the first
ac c eptable, though frequently not optimal, solution.

 Assure alternatives are consistent with work

group goals.

 Have alternatives build on each other—modify, combine with, and “hitchhike”

on other alternatives.

Techniques to Create Alternatives

Problem solvers can use many approaches to create alternative solutions. The focus here
is on two techniques:

 Brainstorming

 Nominal grouping

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 Create
Solutions
BRAINSTORMIN
G
Critic ism
Combination and
is
prohibite improvement are
d sought

Brainstorming

“Freewheeling” is Quantity is
welcome welcomed

The sole purpose of brainstorming is creating ideas. When brainstorming, people often will mentally
evaluate the ideas being discussed, yet is it important not to evaluate them out loud during the
discussion.

Typically, many of the ideas created are impractical due to the nature of the problem itself. Also,
the brainstorming process (see the Brainstorming Guidelines below) is free-wheeling and
may result in some interesting yet impractical ideas. Impractical ideas will be eliminated when
problem solvers move to Step 3 and evaluate alternatives based on standards and criteria. For that
reason, each participant in a brainstorming discussion should work on “not evaluating” - the really
bad or impractical ideas will be eliminated in Step 3, so it is proper to avoid evaluating (a Step 3
activity) while doing Step 2.

Brainstorming creates a large number of ideas (high quantity) from which a few good solutions
(high quality) will emerge, leading to the desirable outcome of picking a solution in Step 3 that best
solves the problem.

Brainstorming Guidelines

 Critic ism is prohibited.

 “Freewheeling” is welcome.

 Quantity is wanted.

 Combination and improvement are

sought.

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 Create
Solutions
BRAINSTORMIN
G

Group Activity

Brainstorm ways that you can cope with the changes that are occurring at
work.

 Brainstorm ways to c ope

 Look for duplic ation
 Arrange ideas into related groups
 Look for ways to combine and/or improve ideas

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 Create
Solutions
NOMINAL GROUPING

This approach to identifying creative alternative solutions uses the variety

of ideas available from a group of problem solvers; however, it differs
from brainstorming in two ways:

 Alternatives are created and evaluated in the same meeting,

though not at the same time.

 The technique is highly structured and it intentionally restricts

verbal communication during the idea-generating phase.

The primary benefit of nominal grouping is that it reduces the inhibiting effects of group
interaction when generating alternatives. Also, it is proactive rather than reactive because it
requires people to create their own ideas. Using this technique may help when a group is
brand-new (i.e., have not had time to develop as a group). Nominal grouping is also useful
when the work group is a mix of new employees and veterans because it tends to limit the “us
vs. them” dynamic that some- times occurs in groups.

Nominal Grouping Rules

 Individuals (fewer than 10) are brought together and familiarized with a problem, such
as “What alternatives are available for increasing a certain output of the work group?”

 Each group member is asked to work silently and alone to prepare a list of ideas to
solve the problem.

 After 10 to 15 minutes members share their ideas, one at a time, in a round-robin

manner. Ideas are recorded on a flip chart or other visual aid large enough for all to
see. The round-robin process continues until all ideas are presented and recorded.

 A period of structured interaction follows during which group members openly discuss
and evaluate each recorded idea. At this stage ideas may be reworded, combined,
deleted, or added.

 Each member votes, privately ranking the recorded ideas in order of perceived
importance. Following a brief discussion of the outcome of the vote, one more private
vote is conducted. The group’s preference is finally determined by the total of the
ranked votes.

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Evaluating Alternatives

EVALUATING ALTERNATIVES AND SELECTING THE BEST

ONE

3
Evaluate
alternatives This step involves the careful weighing of the pros and cons of
and select one
the proposed alternatives in order to make a final selection.
Decision makers need to be sure that the alternatives are
judged in terms of the extent to which they will solve the problem without causing other
unanticipated problems. Judging alternatives means that people are using criteria –
standards or requirements that are important to solving the problem – in order to select
the best alternative(s).

Satisfactory and Optimal Decisions

Satisfac tory approac h

Once the decision maker finds an alternative that meets some minimum standards of
acceptability, that alternative is chosen and implemented, even if all of the alternatives
have not been reviewed.

 Alternatives are evaluated only until one is found that is “satisfactory,” then it is
implemented. This means there are likely to be alternatives that do not get
evaluated, since the process is finished when one that is “good enough” is
found.

 This process is usually faster, since the decision maker is trading quality for speed
on purpose. The risk is a lower quality decision that is less effective.

Define Create Select

problem alternatives one Implement
Does it solve the
problem? Ye
s
No

Current Reality
So, Paul has a turnover problem and a morale problem with the FIs who are still with him.
Also he has no senior staff/lead workers he can effectively delegate things to at the
moment, unless you consider his 18-month FI a “veteran,” and the overall performance of
his Region is barely adequate only because he is out in the field himself.

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 Evaluating Alternatives

EVALUATING ALTERNATIVES AND SELECTING THE BEST ONE

Optimal approac h
To achieve the best decision in a given situation, alternatives are identified and
evaluated with respect to decision criteria, and the best available alternative solution
(the optimum one) that meets those criteria is c hosen.

Critical data is analyzed, alternatives are identified, then e a c h alternative is

compared to the criteria.

Choosing the optimum solution takes more time than the other approach (the satisfactory
approach), yet in the long run the quality and effectiveness of the decision is likely to be
higher since the decision maker is examining all of the available choices.

This process is slower than the satisfactory approach, since the decision maker is trading a
longer amount of time in order to gain quality. The risk is a higher quality decision that is
too late.

Select
and Does one meet the
Define Create evaluate criteria better than Implement
problem alternatives all all the others?
against Ye
criteria s

No

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 Evaluating
Alternatives
DECISION CRITERIA

Decision Criteria
The function of criteria is to provide a detailed description of what is required for a successful decision
and to serve as a performance c hec k on the alternatives c reated in Step 2.

Most individual decision-making is done in a “semi-automatic” way, that is, without a lot of conscious
thought given to the standards and requirements that exist around an issue that will lead us to choose
one alternative over another. This is normal and necessary for a lot of individual decisions. It is also
often done in a work setting, where the decision-maker has to make many small or medium decisions in
a work day. The rapid pace and semi-conscious nature of such decision-making will probably not
benefit from a change toward some other decision-making approach.

When agency issues face us in a way that indicates a decision is going to involve many factors, a more
open and sturdy process is necessary. A process that involves discussing and writing criteria so all the
nec- essary information is out on the table — in writing — allowing for a free flow of information.

Sources of Decision Criteria

 Properly defined problem statement from Step 1.

 The experienc es of the decision maker, good and bad.

 The policies, rules, regulations, goals, objectives, etc. of the agency and the work unit.

Characteristics of criteria

 Each criterion is a specific, measurable item.

 Criteria reflect expected end results.

 Includes consideration of factors that affect the decision, e.g., how likely is it that X will
happen or how much risk is there if we do X or do not do Y?

Written criteria is probably not necessary for most individual decisions and for small decisions with few
alter- natives and few separate characteristics of the alternatives. However, when decision-making is
part of 4- step problem solving, or is a standalone activity that will affect the work unit’s productivity,
employee mo- rale, the work processes at work, or the budget, the decision criteria should be plainly
written, specific enough to measure, and done in writing.

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Evaluating Alternatives

TWO CATEGORIES OF CRITERIA: LIMITS & DESIRABLES

Limits
 These criteria are requirements used to make an initial go/no-go decisions about
alternatives. Limits are used to make a first pass through the original list of alternatives.

 They must have clear, measurable statements of limitation, so that the elimination of
unsatisfactory alternatives is quick and relatively painless.

 There are specific boundaries and constraints necessary for making a successful choice.

 They are a form of protection for the decision maker because they restrict the decision
to alternatives that provide at least minimal success (i.e., failure to satisfy a limit makes
an alternative impossible to consider).

Desirables
The factors that are left over after the decision maker chooses the factors that are limits.

 “Nice to have” instead of “need to have” (see the table below where there is a decision
to be made about renting an apartment)

STEP 3 Considering elements of renting an L D Rewording the elements into

apartment: decision making criteria

Closer to the grocery store X Identify criteria that are limits:

Security people on site at the right time X  Minimum 2 bedrooms

 Minimum 1 year lease

2 bedrooms X
 Maximum of 1650 rent
1 year lease X per month

Close enough to the bus routes X Identify criteria that

are Desirable:
No more than spending $1650 rent X
 Security staff 24
per month hrs
Lowest price for monthly rent of the X  Lowest price
place that has these things
 Close to bus routes

 Close to grocery
store
How to Begin Writing Decision Criteria
 List the general fac tors to be c onsidered.

 Once this list is built, convert it to criteria by completing this phrase for each of the factors on
the list: “Whatever I (or we) choose should . . .”

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 Evaluating
Alternatives
COMPARING ALTERNATIVES

Process of Comparing Alternatives

 Organize the information about alternative solutions into a matrix to provide a comparison of the
in- formation about each alternative from Step 2 against the limits established in Step 3.

 Use a “go/no-go” approach when comparing each alternative’s information against the limits.
 If an alternative meets all of the limits then it is a “go” for further consideration. If not, it
must be disc arded as an alternative (“no-go”).

 Use ranked desirables to finalize the decision if you have more than one alternative remaining after
comparing alternatives to the limits. Desirables are ranked #1, #2, #3, etc., and the decision is
made if one remaining alternative is better at desirable #1. If there is a tie, the comparison
continues using desirable #2, etc.

Using the information from the following table, a decision maker can create a matrix and make
comparisons of alternatives to the required limits, and if necessary, to the desirables (see next page).

STEP 3: Evaluate alternatives and pick one, using this matrix.

Apartment Choices
#14 Bloom St #27 Phister Ave #32 Gate Ln #55 Pine Ct
Go No Go No Go No Go No
Go
Go Go Go
Limits
$1650 $1638 $1650 $1618
No Lease 1 yr lease 1yr lease 1 yr lease
2 bdrm 2 bdrm 3 bdrm 2 bdrm
Desirables
Secure
Price
Bus
Grocery

Setting up a matrix with the limits and desirables.

This method of comparing alternatives to criteria in a matrix allows you to use limits, and if necessary,
desirables. If you are only interested in a satisfactory solution then any alternative that survives the
limits criteria is satisfactory and Step 3 is over. However, if you are seeking an optimal solution, use
the desirables criteria to pick the best one.

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Evaluating Alternatives

MAKING AN OPTIMAL DECISION

Make an optimal decision justified by the risk and relevance to criteria.
In this step the decision maker uses the matrix with limits created earlier as a go/no-go filter to
exclude any alternatives that do not meet the mandatory limits of the dec ision.

The Final Decision

 When there is more than one alternative remaining after using the limits criteria, the decision
maker uses the desirables criteria and his/her best estimate of risk (if applicable) to determine the
final ranking.

 If a group is making the decision, they must be capable of engaging in an objective discussion
and evaluation of the desirability of each remaining alternative solution and its potential risks.

STEP 3: Evaluate alternatives and pick one, using this

matrix.
Apartment Choices
#14 Bloom St #27 Phister Ave #32 Gate Ln #55 Pine Ct
Go No Go No Go No Go No
Go
Go Go Go
Limits
$1650 X $1638 X $1650 X $ 1618 X
No Lease X 1 yr lease X 1 yr lease X 1 yr lease X
2 bdrm X 2 bdrm X 3 bdrm X 2 bdrm X
Desirables
Secure
Price
Bus
Grocery

Using criteria limits to filter out the unacceptable alternatives, leaving several acceptable ones for
further comparison using criteria desirables to pick the best solution.

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Evaluating Alternatives

MAKING AN OPTIMAL
DECISION
STEP 3 Evaluate alternative solutions and pick one.

Limits Employee Employee Employee Employee Employee

Informatio Informatio Informatio Informatio Informatio
n n n n n

Desirables Use Desirables to make a final decision if more than one alternative remains after using
(ranked by the go/no-go Limits. If there is a tie for the highest ranking on Desirables #1, go on to
priority) #2, #3, etc., until you have one alternative that wins.

1)

2)

3)

4)

5)

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 Implement the
Solution
IMPLEMENT THE SOLUTION &
FOLLOW UP

4 Implementing a solution to a problem introduces change into the

Implement and follow workplace. Since almost any change creates some resistance,
up on the solution im- plementing a solution requires sensitivity to possible resistance
from those who will be affected by the solution. Supervisors who
consid- er possible work group resistance in Step 1 will probably
have less fric tion than those who wait until Step 4 to think about
it.

During implementation, problem solvers must be both proactive and reactive:

proactive to ensure the problem gets solved, and reactive to make sure they can
ad- just the implementation when faced with delays, obstacles, and surprises.

Follow-up not only sustains implementation, but also serves as a way to get feedback and
gain information that can be used to improve future problem solving. Below are some
guidelines for implementation:

 Implement solutions at the right time and in the right sequence.

 Provide opportunities for feedback on how well the solution is addressing the
problem.

 Gain acceptance of the solution by those who are affected by the problem.

 Establish an ongoing monitoring system for the solution.

 Evaluate success based on how well the solution solved the problem, not on
some side benefits which may have left the problem unsolved.

The Role of the Supervisor in Step 4

Two roles must be performed at the same time — (1) managing the tasks necessary for
im- planting the solution, and (2) leading the work group that will be completing the
tasks.

Managing the tasks

The table on the next page shows a format for planning the steps necessary to
implement a solution.

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Implement the Solution

IMPLEMENTATION
STRATEGY
Strategy to implement the solution:

Steps– what to do Person’s Responsible Time Frame Resources Needed

Task 1

Task 2

Task 3

Task 4

Task 5

Sample table format for planning the implementation

The tasks to be managed are the steps that complete the implementation. Following up on these
tasks with a written plan helps to assure that necessary deadlines are met. Follow-up is easier to do
when steps are written down in a format that helps the problem solver easily identify what will be
done, who will do it, when it will be done, and what resources are needed.

Leading the work group

Leading people is different from managing things. In Step 4 of problem solving, the primary issues
that problem solvers will fac e c onc erning people are:

 Gaining acceptance by those affected by the solution or its implementation

 Providing opportunities for feedback from those affected, when necessary

These issues are also dealt with earlier in Step 3. If the work group members are capable, they will
want some input into the problem solving process. Experienced, capable people will accept the re-
sponsibility that comes with participating in decision making. However, even when these
experienced, capable people don’t have any decision-making input they will still demonstrate
understanding (acceptance).

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Appendix

JOB AID: PROBLEM

SOLVING

1 DEFINE THE
Ask “5 Whys.”
2 CREATE
PROBLEM ALTERNATIVE SOLUTIONS

 Brainstorming– group creates alternative solutions through verbal interaction

(no evaluating, unstructured).
 Nominal Grouping– individuals create alternatives nonverbally, then
group evaluates the alternatives (highly structured).
3 EVALUATE ALTERNATIVES AND SELECT ONE (DECISION MAKING)

 List fac tors affec ting decision.

 Generate limits and desirables decision criteria, and prioritize the desirables.
 Use limits criteria to eliminate the unacceptable alternatives, then use
desirables c riteria to pick the optimal one.

4 IMPLEMENT THE SOLUTION AND

FOLLOW UP
 Mange tasks involved in implementation. (Who, what, when, and
the resourc es needed)
 Lead the work group that will be doing the tasks. (Determine how much group
in- volvement is appropriate before you go to Step 4.)

4 FACTORS AFFECTING PARTICIPATION 4 DECISION MAKING OPTIONS

1. Time 1. Problem Solver decides alone

2. Information 2. Problem Solver consults the group and then

decides alone
3. Capability of the work group members
3. Participative decision by group members
4. Acceptance and problem solver

4. Problem-solver lets someone else decide.

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 Appendix

REFERENCES

Alamo Consulting Group, Inc. Process Management Skills: Decision Making. Design and
development consultant: Margo Murray-Hicks. Walnut Creek, CA: The Alamo Consulting Group,
Inc. 1982

Bedeian, Arthur G. Management. New York: Holt, Rinehart and Winston. 1989.

Bittel, Lester R. and Newstrom, John W. What Every Supervisor Should Know: the Complete Guide
to Supervisory Management. New York: McGraw-Hill. 1990.

Certo, Samuel C. Supervision: Concepts and Skill Building. Boston: McGraw-Hill Higher
Education. 2000.

Lussier, Robert N. Human Relations in Organizations: Applications and Skill Building. Boston:
Irwin/ McGraw-Hill. 1999.

Plunkett, Lorne C. and Hale, Guy A. The Proactive Manager: The Complete Book of Problem
Solving and Decision Making. New York: Wiley. 1982.

Senge, P.M.; Kleiner, A,; Roberts, C.; Ross, R.B.; Smith, B.J. The Fifth Discipline Fieldbook. New
York: Currency-Doubleday. 1994.

Simon, Herbert A. Administrative Behavior: A Study of Decision-Making Processes in

Administrative Organizations, 3rd edition. New York: Free Press. 1976.

Whetton, David A. and Cameron, Kim S. Developing Management Skills. Reading,

MA: Addison-Wesley Longman. 1998

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