The increasingly interconnected world no longer supports the belief that decision-making is best left in the hands of an enlightened elite. Sharing relevant enterprise-information across projects and/or departments engages workers and can improve performance.  Leveraging available social media develops more robust channels of internal communications, opening access to wisdom of the crowd (WOTC) processes of collaborative decision-making, based on the group intelligence of the enterprise.  Skillfully enacted, wisdom of crowds may:

• improve workplace motivation and job performance sufficiently to
• deliver timely and relevant contributions to your corporate-community.

Wisdom of the Crowd Decision-Making leads to improved corporate decisions

WOTC contributions to corporate decision-making offer a diversity of opinion and independence of ideas that decentralize reliance on determinations of upper-echelon management alone. Coordinated aggregation of opinion can be improved when social media are appropriately applied to solution-processes to guarantee diversity of opinion, independence, decentralization, and aggregation.

Diversity of opinion: The multiplicity of voices assembled by WOTC distinguishes it from alternative decision-making processes. The often extreme difference of WOTC content originates from a wide-range of ideas, that can subsequently be analyzed to render a focus appropriate to organizational purposes. Social media provide a conduit for diversity of opinion. Rapid and valuable, they are accessible to workers throughout your organization, providing real-time retrieval of ideas about corporate issues from a variety of voices.

Independence: WTOC does not seek to generate ‘crowd-psychology.’ It wants autonomous decisions from unique responders, persons whose ideas are not influenced by the opinions of their compatriots within the firm. Evidence (Surowiecki, 2004) indicates differentiated-assemblies of corporate-personnel autonomously offering ideas can resolve certain issues more effectively than management alone. If appropriately instructed not to interact about the issues-in-question, social-media-deciders render their opinions in relative-detachment from others.

Decentralization & Aggregation: WOTC’s shared-out quality encourages scattered personnel/departmental contributions to corporate decision-making in relative freedom. The decentralized development-process generates elaboration of aggregate-solutions, stemming from unique approaches to corporate-problems, combining diverse essentials from various contributor-solutions into a unified statement or strategy. Social media support interactive coordination of solutions once they have been proposed.

Surviving Wisdom-of-the-Crowd:  Success requires management guidelines

Corporate-culture defines your firm’s internal communications context. Advent and use of workplace social media has immeasurably expanded interactive discourse among workers themselves, and with management. As evidence (Surowiecki, 2004) has suggested, WOTC estimations can be remarkably accurate, and of use to decision-making processes. However, the need for focus remains, since WOTC often reflects an imprecise-generality of ideas, as personnel from separate departments speak to subjects • beyond their particular business-specialty or expertise.

Wisdom of Crowds can tremendously benefit decision-making in your organization, but tends to be successful only as part of a management-controlled process.

Guidelines and directives remain necessary for appropriate concentration on corporate priorities and strategic-development. Use of social media for WOTC-purposes needs to be regulated, precisely to limit their tweety/chatty aspects, which interfere with project-coordination. The WOTC-objective of social media is to unify the project and its decision-making processes.

Expert Choice helps organizations implement collaborative decision-making processes involving multiple stakeholders.  If you find this blog useful, click here to subscribe to upcoming articles in the series; we’ll notify you when they’re published.  Also, we invite comments detailing your observations of social media as a collaborative crowd-source tool.

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As a nation, we have agreed to reduce our spending and deficit levels.  We agree that we need to tighten our belts.  But, in the interest of our fiscal prosperity, as well as our safety, security, and national defense, we need to recognize that cutting all programs equally is inefficient.

Sequestration, as it is likely to be implemented in a Federal show down scenario, is likely to amount to “across-the-board” cuts for Federal Departments and Agencies.   This would result in “Across-the-Board” cuts of 9.4% for the Pentagon, National Guard, the Energy Department’s National Nuclear Security Administration and other discretionary defense efforts over the next decade, and an 8.2 % spending cut for most nondefense discretionary programs — including the Secret Service, the Drug Enforcement Administration, the U.S. Marshals Service and the Bureau of Alcohol, Tobacco, Firearms and Explosives.   (http://www.politico.com/news/stories/1112/84023.html#ixzz2D8rJRedI)

Why are across-the board-cuts are a bad idea?

Compared to reasoned allocations of resources, across-the-board spending cuts are very ineffective.  Why?  Because the relative benefits of different programs vary widely across programs, as well as within programs.

Because the relative benefits of different programs vary widely.  Across programs, as well as within programs, the relationship between the impact (reduction in effectiveness) caused by across-the-board cuts and the amount of the cuts is not linear.  For example, a 5% cut in spending for one program might result in only a 2% cut in effectiveness, while a 5% cut in spending for another program might result in a 15% decrease in effectiveness.

The post Fiscal Cliff Readiness: Portfolio Optimization and Sequestration appeared first on Expert Choice.

Rational decision makers consider multiple objectives

Strong decision makers rarely choose an alternative based upon a single factor or criterion.  Taking the ‘best’ course of action for important decisions entails, with very few exceptions, evaluating multiple objectives.  The best decision makers always consider more than one objective for important decisions –even when those objectives may compete with each other.  In fact, if you encounter a decision-maker situation where a decision is being based only on one factor, BEWARE!  A review of the situation will almost certainly uncover other objectives that should be considered.

Prioritizing multiple objectives is a really a subjective task

Objective vs. subjective debates are traps to be avoided

The choice of the ’best’ course of action almost always involves trade-offs among multiple objectives. And, even when factors can be ‘objectively measured’ the relative importance of the objectives remains subjective. Therefore, all important decisions are subjective.  Let’s consider an example.

Example: Time or Money – What’s More Important?

Consider a simple, but very real world example we encounter almost every day and in almost every complex decision.  Time and money (along with more elaborate manifestations of time and money) are objectives in almost every important decision.  And, compared to many objectives, time and money are easily measured in quantifiable ‘objective’ methods.  But, easily measured does not mean they are merely objective factors!  Even though we can measure time and money in discrete, measurable increments, they still have considerable subjective value in many important decisions.  Why?  Because their relative value is different, depending on the scenario, or the group of people making the decision.

Time and Money – Objective data measures that still have subjective data value

First, let’s consider the relative value of time versus money on a personal level.  A young, poor person is very likely to judge money to be more important than time.  On the other hand, for an older, wealthy person, time is likely to be more important than money.  Who is “right?”

Of course, they are both right!  The relative importance of time and money is dependent on the person (subject) making the decision. There is  no objective data,  or ’formula’ that can ascertain the relative importance of these two objectives. It depends on the subject (the peson or group of people making the decision).

Multiple Objective Methods – Tools to Handle Subjective Data

Just because there there is no pre-determined ‘formula’ to ascertain the relative importance of time versus money – thereare objective and rational processes that can accomodate subjective input, and convert it into numerical based priorities – in a manner that allows synthesis with othe objective inputs, and permits sensitivity analysis across both objective and subjective rankings of importance.  Below is a list of multi-criteria decision methods that have been used over the years to help drive measures of relative value.

Many Different Multi-Criteria Decision Methods

AHP Software - The best method for valuing multiple objectives, particularly for group decisions

The best of these “management science” methods is called AHP (The Analytic Hierarchy Process).

AHP differs in a significant way from many other management science methods–many of which focus only on a single ‘objective’ function. And, as we’ve just discussed, taking the ‘best’ course of action for important decisions entails, with very few exceptions multiple objectives.

Further, many of these other multiple objective approaches typically ask people to ‘assign’ weights to objectives.  AHP is unique in its ability to ‘derive priorities’ by eliciting pairwise comparisons and processing them using an ‘eigenvector’ computation (similar to the computations used by Google).  These derived priorities have been shown to be more accurate than assigned weights in terms of reflecting the real relative importance of objectives to individual decision makers, or groups of decision makers.

The advent of computer technology and social group meeting capabilities has resulted in the availability of several strong AHP software products in today’s marketplace.

AHP Software:  Must-Have Features

Today’s best AHP software packages offer a strong combination of decision structuring, evaluation, and group collaboration tools.  Here’s a list of features you should you expect from a strong AHP tool.

• Ability to organize objectives into clusters of homogenous (similar) importance
• Ability to use of paired comparisons to derive ratio scale priorities
• Ideal and distributive synthesis modes
• Ratings, utility curves and step functions
• Dynamic, gradient, and performance sensitivity analysis
• Tools to help align alternatives with objectives
• Ability to define participant roles and responsibilities
• Ability to segment results at participant and group levels
• Group input capability — that can handle both asynchronous (anytime) and synchronous (simultaneous/real-time) inputs

• Ability to export/import data
• Ability to create an optimum combination of alternatives
• Reporting
• Transparency

Want to Learn More about AHP Software?

Expert Choice has been the leader in AHP Software

for the past 30 years!

The post Rational Decision Making is Subjective Decision Making appeared first on Expert Choice.

…but do you still feel like youwant to use more than your intuition to cast your vote?

You know that your intuition is usually excellent–but still, without structured decision making, you know you might leave out factors that you really care about!

Many voters want to consider multiple issues, but we don’t want to listen to all the political hype and negative media coverage.  Now, undecided and independent voters can synthesize their views of the candidates–despite party affiliations and media noise.

Finally, there’s a fun, easy way for you and other voters to evaluate each candidate across the all the issues…and combine all your views into a strong voting decision, based on your own values and preferences.

 Use a Strategic Decision Model to think through your Vote

Expert Choice has shared a strategic decision support model that you can use to help select your candidate for president of the United States. This decision support template has been designed to so that you get use of both the fast (intuitive) and slow parts of your brain (the prefrontal cortex -devoted to reasoning.)  This model is built using a powerful  mathematical computation called an eigenvector (Google uses the power of eigenvectors in prioritizing web search results.) Eigenvectors are  part of a process called The Analytic Hierarcy Process and is a fundamental computation arising in many branches of mathematics and science.

Click the button below to see which candidate is more preferable to you on each issue, and to what degree.  You will ALSO be able to express the relative importance of the issues as you see them.

You will:

• compare the candidates across each issue
• see how much different issue impacts their overall choice
• understand how (or if) their opinions might change as candidates release more information on their positions for certain topics
• compare how flexible or rigid their positions are on certain topics relative to other voters
• ensure you are making an informed decision, without having to listen to the political media onslaught
• get a picture graph of the tradeoffs that confront you, as well as many others like you, when deciding which candidate to vote for and support.

Want to Learn More about How Your Brain Decides?

Want to learn about how to make better choices in general?  Want to convince a fellow voter that they NEED to take a strategic approach to choosing their candidate?

Read Nobel Prize winner Daniel Kahnerman’s recent book, “Thinking, Fast and Slow.” Kahneman documents numerous cases where our intuitive or emotional decision (thinking fast) is flawed–demonstrating the benefit of structured decision making (thinking slow).

The post Who Should I Vote for in 2012? appeared first on Expert Choice.

To learn more, see:

http://bit.ly/NEoeHs

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