Analysis of Smart Choices by John Hammond - Essay Example

SMART CHOICES John Hammond is a former and a well-known management consultant at both Harvard and MIT. Heis also the coauthor of Strategic Market Planning and lives in Lincoln, Massachusetts. Ralph Keeney is a Southern California University professor. He lives in San Francisco and runs a consultancy firm. Keeney is also the author of Value-Focused Thinking. Professor Howard Raiffa has taught the science and art of negotiations and decision making in the Schools of Public Policy, Medicine, Business and Law at Harvard University for over six decades. He lives in Belmont, Massachusetts and is extensively popular as one of the initiators of the decision sciences field. In this book “smart choices” from the three leading consultants on decision-making, readers get to understand how to approach each and every type of decisions with a set of elementary skills developed by professors from the University of Southern California, MIT and Harvard. In Smart Choices, the authors offer a systematic approach to making the correct choices. They guide people how to be confident and consistent to decisions they make. For example, choosing which job offer to accept, selecting a fantastic book to read to buying the right vehicle. This user-friendly guide demonstrates to readers how to create a complete set of alternatives, assess deep-seated objectives, grapple with uncertainty, determine likely consequences, and make tradeoffs. Not only will the readers understand how to make good decisions, they will understand and learn how to come up with smartest decisions. For any individual caught at a confusing situation, the Smart Choices program improves abilities of decision-making and makes one’s life more fulfilling and rewarding. The three authors claim that making smart choices is an essential life skill, which can be trained. They provide a realistic model for making decisions, and show that it is applicable in both business and personal situations. They demonstrate that the solution is to break down the decision into its individual essentials, identifying those that are most significant, and analyzing potential outcomes. These authors also argue that decisions should be made before turning into problems. Their so-called PROACT (Problem, Objectives, Alternatives, Consequences and Trade-offs) approach can be broken down precisely. I.e. Identifying the Problem, specifying the Objectives, creating Alternatives, understanding the Consequences, and weighing the Trade-offs. By following these crucial steps, an individual must shed light on uncertainty, evaluate risks, and be sentient of what other alternatives a decision might produce. Smart Choices summarizes eight useful elements in making the correct decision, from identifying what exactly the decision is and identifying the objectives to considering risk, tolerance and also looking at what one decides on today influences what he/she may decide in the days to come. The book is complete with real-life situations that effectively demonstrate each element of an excellent decision. The general idea of Smart Choices is that excellent decision making comes about through scrupulous planning and thoughtfulness. In chapter one of this book from the three leading professors on decision making, some decisions are fairly obvious. For example, will you step in for your employer for two weeks while he/she attends an educational development course? Definitely it is yes, or one’s bank account is running low, but he/she has a three-week break coming up and wants to get away to somewhere warm to relax with his/her family. Some of the essential decisions one faces in life are complex and tough, with no obvious or easy solutions, which will not probably affect an individual alone, but also affect his/her family, friends, coworkers and several others both known and unknown. Coming up with compelling decisions is therefore, one of the most significant determinants of how smart someone meets his/her responsibilities and achieve professional and personal goals in life. I.e. the capacity to make excellent choices is an essential skill in life. However, most people fear making difficult decisions in life. By definition, difficult choices have serious consequences and high stakes. They involve several complex considerations, exposing us to other people’s judgments. The necessity of making a tough decision puts us at risks of confusion, anxiety, regret, doubt, embarrassment, loss and error. According to smart choices, in living through a key decision, people undergo periods of irregular overconfidence and self-doubt, of frustration, of flip-flopping and wheel-spinning, of desperation and even of procrastination. The three authors argue that discomfort often leads in making decisions hurriedly, leisurely, or too arbitrarily. It is afterwards that people realize they could have made smarter options, and by then it is too late. All through Smart Choices, Keeney, Hammond and Raiffa offer valuable guidance and insight on the ongoing negotiation and inevitable with oneself when facing trouble. They argue that people have troubles since they are not familiar in making the right decisions. Despite how valuable decision making is to people’s lives, very few individuals ever receive any training or teaching in it whatsoever. Therefore, people are left to learn from experiences. However, experience is an inefficient and costly teacher, which teaches human beings negative habits along with positive ones. Since situations of decision differ so obviously, the experience of an individual making one vital decision often appears of minimal use upon facing the next. For example, how is deciding what house to buy or what school to send your children to related to what medical action to follow for a serious disease or illness, or what balance to strike among cost in planning a new office park? According to the three professors, the relation between the decisions one makes lie, not in what one is deciding, but in how he/she decides. The one and only approach to raising the odds of making a smart decision are to learn how to use an excellent decision making process, which gets to the greatest solution with the least loss of money, energy, composure and time. The three authors also point out that an efficient decision making procedure fulfills six criteria. These include: • It is logical and consistent. • It is reliable, straightforward, flexible and easy to use. • It stresses on what is vital. • It guides and encourages gathering of appropriate information and informed opinion. • It calls for only as much analysis and information as is essential in resolving a particular dilemma. • It recognizes both objective and subjective factors and combines intuitive with analytical thinking. In addition, the authors claim that a decision making approach, which addresses the above criteria, can be put into practice on major and minor decisions. The more one uses such an approach, the more resourceful and efficient it becomes. As one grows more skilled and confidence, decision making becomes the second nature. The book also provides a straightforward and proven approach for decisions making. It does not mention on what to decide, but shows how to. The approach meets the above mentioned six criteria. It assists one to see both the substantial and the insubstantial aspect of decisions’ situation clearly and translate all relevant feelings, facts, opinions, advice and beliefs into the finest possible choice. Exceedingly flexible, it can be applied to professional and business decisions, to personal and family decisions and any other decision one needs to make. This method does not make difficult decisions easy. Difficult decisions are difficult because they are complex, and nobody can make the complexity vanish. According to the authors of smart choices, this program takes one step at a time. They have discovered that even the toughest decisions can be resolved and analyzed by taking into consideration a set of eight basic elements. The first five constitutes the center of the approach and are applied to almost any decision. The acronym PROACT operates as a reminder that the useful decision situation approach is the proactive measure. They argue that the worst thing an individual can do is waiting until a decision or choice is forced or made for him/her. The Eight Elements of Smart Choices according to Keeney, Hammond and Raiffa are Problem, Objectives, Alternatives, Consequences, Tradeoffs, Uncertainty, Linked Decisions and Risk Tolerance. The last three elements: uncertainty, linked decisions and risk tolerance assist in clarifying decisions in evolving or volatile environments. Quite a number of decisions will not involve these three elements, but several of the most crucial decisions will. The book defines the real significance of the PROACT program as to conquer and divide. CONCLUSION In order to determine a complex decision situation, it is advisable to break it into the above eight elements and systematically think about each one, giving more attention on the key ones to that particular situation. Finally, reassemble the analysis and opinions into the smart choice. In the end, although this process may not make a tough decision easy, it will undoubtedly make it easier. Hammond, Raiffa and Keeney, provide precious guidance and insight on the unavoidable and ongoing negotiation with oneself when faced with a complex decision. By systematically following their effective process, anybody can make essential business or personal decisions with greater confidence, clarity and efficiency. Works Cited Hammond John, Keeney Ralph and Raiffa Howard. Smart Choices: A Practical Guide to Making Better Life Decisions. New York: Broadway Books, 2002. Print. Read More