Week 2 Chapter 17 - Decisions, Decisions

1
Chapter 17 Decisions, Decisions

Presenter Notes
Identify the essential elements of the
decision-making process, determine how the common
constraints define the boundaries of the decision
environment, and relate risk, uncertainty, and
potential consequences to the decision-making
effort.

2
CHAPTER 17

• The basic decision-making process
• Identifying the problem
• Gathering information
• Analyzing information and creating alternatives
• Choosing an alternative
• Implementing the alternative
• Following up

Presenter Notes
Your text book suggests a 6 step decision-making
process that is shown here.

3
IDENTIFYING THE PROBLEM

• In identifying the problem, always be wary of
  focusing on a symptom rather than on the real
  problem

Presenter Notes
When identifying a problem, be sure that it is a
real problem worthy of your time. If you do
actually have a problem, it is something based in
fact, not opinion.



Is the problem unique or recurring? If it is
recurring, do procedures already exist to solve
it?



Is this a true problem or the symptom of a
problem? Treating a symptom may have a positive
effect on the situation but usually the problem
will reappear because you have not drilled down
to the root cause. Take, for instance, the
example in your text. The transcription
department is behind on its work, so you
authorize overtime or temporary help the
backlog is eliminated and the problem solved,
right? But several days later, the transcription
department is behind on their work again. Why?
Because we treated a symptom of the problem, not
the problem itself. There is the need to examine
the real difficulty. Maybe you do not have enough
staff to handle the volume of transcription.
Maybe the supervisor is distributing the work
properly. And perhaps its the physicians and
how or whrn they dictate patient notes.



4
GATHERING INFORMATION

• In gathering information, how much is enough?
• Let the potential consequences of the decision
  govern how much effort goes into collecting
  information

Presenter Notes
There is no need to gather all of the information
when trying to solve a problem. Why? Because
there is never an end to the collection of
information.



As a manager, you have to decide if you have
sufficient information on which to base a
decision. That decision is embedded in realizing
the relationship between risk and reward. How
much risk is there in the consequences of your
decision? Is it worth the risk to reap the
potential benefits? The larger the risk, the more
information you will need to gather in order to
make a decision because the potential
consequences may be far-reaching.



When a health care organization needs to make a
decision about purchasing an expensive piece of
diagnostic equipment, the decision making process
requires the gathering of a fairly large amount
of information. This decision may deal with
hundreds of thousands of dollars and also with
the ability of physicians to make informed
decisions. The risk is high but so is the reward
if you decide correctly.



The decision whether to use blue or black ink on
encounter forms will not require the same amount
of information gathering as our diagnostic
equipment. The decision has very low risk and low
reward. The decision might be made after spending
a few minutes talking to the employees who work
with encounter forms and asking them about the
consequences of the decision.

5
TEST YOUR DECISION

• Does this really address the cause?
• Does this affect policy or set precedent?
• Will implementation adversely affect any other
  part of operations?

Presenter Notes
Now it is time to use the information you have
gathered to develop some alternative solutions.
Youll compare these alternate solutions with
each other. Youll check policy, procedures, and
practices to make sure the alternatives do not
violate the law or the organizations policies.
Then you must weigh the impact of each solution
on the individuals or groups involved will it
make them more or less productive?

6
CHOICE AND ACTION

• A decision is both choice and actionthe choice
  is incomplete without the action

Presenter Notes
Now you have a decision, youve made a choice,
and it is time to take action. There are still
questions to be asked



Do I have authority, real or implied, to
implement the decision? Or do you need to take it
to your manager for approval?



If the decision is to be implemented when is
the best time to act? Just like in comedy, timing
is everything.

7
COMMON CONSTRAINTS

• Time
• Money
• Quality
• Personalities
• Politics

Presenter Notes
Constraints are the conditions that limit or
restrict decision making. This slide lists the
most common decision-making constraints



Time may or may not play a part in your
decision. Simple, low risk decisions may not
require you to worry about how long it takes to
reach a decision. On the other hand, if JCAHO is
coming for a site visit next week, you will need
to make a decision quickly because you now have a
time constraint.

Money a very common constraint. Your
organization may or may not have the funds
available to implement your decision. Is it in
the budget for this year or do you need to submit
it as a budget expense for next year? Is there
grant money available that will enable you to
implement the decision? Or is there no money
available?

Quality health care consumers continue to
demand a high level of quality care. As such, the
affect your decision has on patient care and
service can be a large constraint on implementing
your decision. The implementation cannot
negatively affect quality of care.

Personalities while not the largest
consideration in decision making, peoples
personalities may play an important part in the
implementation of the decision. Remember that the
decision is implemented through and with people
who may or may not have an opinion about how
things should be done.

Politics how different group in the
organization will react to the decision is also a
constraint. Perhaps you believe that in order to
save money in a tight economy, it is necessary
for the organization to stop contributing to
employees 401K retirement plans. This decision,
while fiscally sound, will alienate the employees
and negatively affect morale. If your decision
meets with strong political opposition, it will
be difficult to marshal the resources and effort
to implement it.



8
A CONSTRAINT MAY BE

• Absolute, providing a specific barrier that
  cannot be overcome
• Practical, not an absolute barrier but
  approaching a point beyond which proceeding is
  impractical

Presenter Notes
Constraints can be either absolute or practical.



If the constraint is absolute, then it is a limit
beyond which you may not proceed. The most
obvious absolute constraint is money. If you are
given a fixed amount of money to solve a problem,
you cannot exceed that limit.



A practical constraint is not an absolute
barrier. Instead, one must determine when it is
no longer practical to implement an alternative.
Your diagnostic equipment requires 2,000 square
feet of space in order to function properly. Is
there 2,000 square feet available to house the
equipment? If not, then the purchase become
impractical.

9
EVERY DECISION INVOLVES

• Risk (something can be lost if its wrong)
• Uncertainty (the outcome is never 100 assured in
  advance)

Presenter Notes
As I said earlier, every decision involves risk
and reward. Risk exists because something may be
lost if the wrong decision is made time, money,
efficiency, or safety. Uncertainty also exists
because you can never be 100 certain that a
particular decision will come out correctly.



A Major objective of decision making is to reduce
the risk and uncertainty as much as possible. The
risk and uncertainty are certainly evident in
this old logic problem



The Lady or the Tiger

A young prince and princess had fallen in love,
but the girl's father, a bitter old King, opposed
the marriage. So the King contrived to lure the
Prince into a trap. In front of his entire Court
nobles, clergy, jesters and even scullery-maids
he challenged the Prince to prove his love in a
highly unusual and dangerous game.



"The Princess," said the King, "is behind one of
these three doors I have placed in front of you.
Behind the other two are hungry tigers who will
most certainly eat you for dinner. If you prove
your love by picking the correct door, you may
marry my daughter!"

"And just to demonstrate that I'm not a bitter
old man," said the King (who secretly suspected
that's exactly what everyone thought of him), "I
will help you. Once you make your choice, but
before you open the door, I will show you a tiger
behind one of the other doors. And then," intoned
the King magnanimously, "you may pick again!"



The court broke out into polite and dutiful
applause. The King smiled, convinced that the
Prince would not be man enough to take the
challenge, even with the King's help.



Now the Prince knew that if he walked away he
would likely be banished in shame from the
Kingdom forever, never to see his love again.
This he could not bear. And he was also a very
clever Prince. So he swallowed hard, uttered a
short prayer for luck, and then picked a door at
random.



"I choose this door," said the prince in his
deep, manly voice, as he walked over to one of
the doors.



"Wait!" commanded the King in surprise. "I am as
good as my word. Now I will show you a tiger.
Guards! Reveal a tiger from behind one of the two
remaining doors!"



Three of the Kings guards cautiously walked over
to one of the other doors, opened it a crack, and
then quick as they could slammed it shut. A huge
hungry tiger had been crouching right behind it!
The door shook as the tiger leaped up against it.

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REDUCING RISK

• All activity invested in analyzing alternatives
  is aimed at reducing risk and uncertainty
• If there were no risk and no uncertainty, there
  would be no decision to make because the outcome
  is self-evident

Presenter Notes
All of our efforts at gathering and analyzing
information, the use of sophisticated
mathematical models, or decision trees, etc. are
efforts to remove as much human judgment as
possible from the decision making process.
Hopefully, the quantitative and qualitative
information you have gathered and analyzed will
decrease the chance of being wrong.



Without risk and uncertainty, there is no need
for decision making.

11
THE NO-DECISION OPTION

• Consciously deciding not to decide, or
• Ignoring the situation
• And this kind of decision can have the most
  far-reaching consequences

Presenter Notes
Not making a decision is making a decision. You
have decided to ignore or postpone the problem
and not deal with it. We hope that the problem
will cure itself. Surprisingly, some times it
works! Most often, when things are left to
themselves, they go from bad to worse.



A Theodore Roosevelt said, In any moment of
decision, the best thing you can do is the right
thing, the next best thing is the wrong thing,
and the worst thing you can do is nothing.

12
DECISIONS AND AUTHORITY

• The decisions you make must fall within your own
  scope of authorityany potential decision
  affecting other groups must become a matter of
  joint consideration

Presenter Notes
When you make a decision that affects the
employees in your span of control, it is
consistent with your position as their manager.
It is very important to realize however, that if
you make a decision that affects employees in
your department and another department, you must
involve the supervisor for the other department.



Thats it for chapter 17 Decisions. Let me
leave you with this thought from author, Isaac
Asimov

It is change, continuing change, inevitable
change, that is the dominant factor in society
today. No sensible decision can be made any
longer without taking into account not only the
world as it is, but the world as it will
be.See you next time!