CHAPTER 11“MAKING DECISIONS”

THOMAS WHITEANHDANADAVIDBRANDON

Data-driven decision making propels Yammer to edge of

Agile and beyond

DEFINITIONS

Decision making = refers to making choices among alternative courses of action – which may also include inaction

Programmed decisions = decisions that occur frequently enough that we develop an automated response to them.

Decision Rule = Automated response to problems that occur routinely.

Non-programmed decisions = unique, non-routine, and important. These decisions require conscious thinking, information gathering, and careful consideration of alternatives.

Strategic Decisions

Should we merge with another company?Should we pursue a new product line?Should we downsize our organization?

Top Management Teams, CEOs, and Boards of Directors

Tactical Decisions

Operational Decisions

What should we do to help facilitate employees from the two companies working together?How should we market the new product line?Who should be let go when we downsize?Should we merge with another company?Should we pursue a new product line?Should we downsize our organization?

Managers

Employees throughout the organization

Level of Decision Examples of

Decision

Who Typically Makes

Decisions

Data-driven decision making propels Yammer to edge of Agile and beyond

“As the co-founder of a tech startup, Adam Pisoni knew surviving in the land of digital disruption boiled down to two things: One, figuring out what customers really want (rather than what they say they want); and two, building those products faster than the competition.”

“so Yammer threw tradition out the window and opted instead for what Pisoni calls post-Agile: a data-driven, collaborative engineering environment that experiments on just about everything, including organizational structure.”

STRATEGIC DECISION

Data-driven decision making propels Yammer to edge of Agile and beyond

TACTICAL DECISION

“What was holding Pisoni and his team back? The answer started to take shape when one of Pisoni's engineers introduced him to Conway's law, which essentially states organizations create products and services that are reflections of themselves. What needed to change was how the organization operated.”

"You can't test fast enough to have the data be meaningful," he said. That's why breaking down bigger projects into smaller ones is key. Smaller projects mean more flexibility, enabling engineers to move from hypothesis to testing to iteration and back to hypothesis quickly, Pisoni said.

Making Rational Decisions

Rational decision-making model = A series of steps that decision makers should consider if their goal is to maximize their outcome and make the best choice.

Decision criteria = A set of parameters against which all of the potential options in decision making will be evaluated.

Alternatives = Other possible solutions to a problem in a decision-making process.

Analysis Paralysis = A decision-making process in which more and more time is spent on gathering information and thinking about it, but no decisions actually get made.

8) Evaluate the

Decision

7) Implement

the decision

6) Choose the best

alternative

1) Identify the

problem

5) Evaluate the

alternatives

2) Establish decision criteria

3) Weigh decision criteria

4) Generate

alternatives

Rational Decision-Making Model

Data-driven decision making propels Yammer to edge of Agile and beyond

“As the co-founder of a tech startup, Adam Pisoni knew surviving in the land of digital disruption boiled down to two things: One, figuring out what customers really want (rather than what they say they want); and two, building those products faster than the competition.”

"It dawned on us that in order to iterate on a product quickly, we have to be prepared to iterate on the organization quickly," said Pisoni, chief technology officer and co-founder of the enterprise social software company Yammer Inc

Making Creative Decisions

Creativity = The generation of new ideas that are original, fluent, and flexible.

Fluency = The number of ideas a person is able to generate.

Flexibility = How different the ideas are from each other, if individuals are able to generate several unique solutions to a problem, they are high on flexibility.

Originality = How unique a person’s ideas are.

Dimensions of Creativity

Fluency

CREATIVITY

Flexibility Originality

The Creative Decision Making Process

Step 1

- Problem recognition

Step 2

-Immersion

Step 3

-Incubation

Step 4

-Illuminatio

n

Step 5

-Verification

and Application

“Rather than build on top of a search feature customers didn't like in the first place, the data convinced engineers to think about why search wasn't driving interest and to work out the kinks. To that end, the company used A/B testing, a method enabled by cloud computing that compares the behavior of a randomly selected group of users given access to new features against those who weren't. Each modification to the product is tested.”

Data-driven decision making propels Yammer to edge of Agile and beyond

Questions ????

What are some business related decisions that you have had to make?

Need questions