Decision patterns as intellectual capital

Knowledge grows the more it is used and applied.  Intellectual capital is a term that has been coined to describe the sum total of the knowledge assets of an organization.  However, everything that your employees (or customers or partners) know isn’t really usable as intellectual capital unless it has been captured (mined and preserved in the face of staff turnover) and made available through some form of knowledge sharing.

Every organization has a large of part of its intellectual capital at risk; it can walk out the door on a moment’s notice.  As the baby boomers age and retire, an immense store of knowledge may go “poof”.  While some of this knowledge has become stale with time (knowledge has a shelf-life), much of it represents the best of the best thinking that’s been done within your organization.

Decision patterns such as those delivered within the Decision Driven® Strategy web service are the single most valuable form of intellectual capital.  A Decision Network framework for any organization is a very stable superstructure on which to hang all your highest-value knowledge assets.  Shouldn’t you start today to capture these assets and share them with the members of your team?

Just released - Compare Alternatives - Spider Chart

I have just released the new Compare Alternatives capability to both the Decision Driven® Strategy and Decision Driven Life web services.  You can now toggle between 2 different comparison views:

Tornado Chart: This chart compares the relative effectiveness of any pair of alternatives.  It displays their advantages/disadvantages in a simple bar chart format that highlights the discriminators between the 2 solutions.

Tornado Chart - Portfolio decision

Spider Chart: The Spider Chart compares up to 5 alternatives at a time against the top 15 criteria.  It is very useful for portfolio decisions where you may consider 10-15 alternatives and commit to implement 5-8 based on their relative merits.

Spider Chart - Portfolio decision

Spider charts are also known as Radar Diagrams.  I’ve intentionally implemented this as a “lopsided” diagram in which the length of each “spoke” matches the priority/weight of the criterion it represents.  This presents a truer picture of the “trade space” where alternatives compete for supremacy between the must limit and ideal values.  The area inside each “web” represent the overall effectiveness of an alternative; the web with the greatest area suggests the most attractive solution, all things considered.

Spider charts are also a good way to capture a competitive analysis.  Use it to score out your organization’s market positioning statements (value propositions or differentiation strategies) relative to your competitors.  Spider charts are also good for recognizing and communicating opportunities for hybridization; combining 2 alternatives in such a way that you can take advantage of their relative strengths while offsetting their weaknesses.  Business partnerships, mergers, acquisitions and joint ventures can all be visualized as hybrids.

Both charts include a common legend that graphically displays the overall effectiveness of each alternative as a summary scoring bar. This can help you quickly separate the wheat from the chaff and zero in on the top few alternatives.

Decision: Facilities

In these days of $4+ gasoline, it might be a good idea to revisit your organization’s Facilities decisions.  Within the Decision Driven® Strategy decision pattern, I have a decision branch for facilities directly beneath the top-level Vision decision.  You could attack a facilities decision at this global level or you might frame and focus the decision a bit more tightly as “Facilities for Group X” or “Facilities for Function Y”.

In either case, here’s a criteria pattern to jump-start your evaluation:

 

I’ve increasingly been telecommuting for most of my work with clients over the past several years.  Many of my clients have been moving the same direction; giving their knowledge workers increasing freedom of their work location.  Nearly everyone I know is growing increasingly comfortable and effective working in a distributed mode; leveraging low cost e-meeting and teleconference services in the place of expensive brick-and-mortar conference rooms and office space.  There are limits to these distributed operations and virtual office trends, but almost every organization has some part of their team and operations that could benefit.

Start a Decision Driven® Strategy trial today and Think it Through!

Decision: Process Initiatives

Most successful organizations invest regularly in process initiatives that grow their core competencies.  The past few years a lot of companies have burnt their budget for such things on six sigma, lean “whatever” or various gate process frameworks.  All of these contribute to operational excellence with very little benefit to strategic excellence (see my June 23 post on Strategic vs Operational Excellence).

I believe Decision Management is the single most valuable capability (process core competency) that any organization could invest in to achieve strategic excellence.  I’m biased of course, but if you score out a decision management process initiative against any other process investment you could make this year, I believe it would overwhelm its competitors.

Here is the criteria pattern that I recommend that you use when evaluating process initiatives:

Decision Management fills an important gap; most companies have been pursuing operational efficiencies while assuming that strategic excellence could be achieved by hiring or rewarding more “born leaders”.  It delivers well against such criteria as process maturity, efficiency and capacity.  Decision Management uniquely creates a game-changing capability to leap-frog the competition through its time-to-market and innovation benefits.  It creates unique synergies among other process competencies by providing the thinking “glue” that integrates all other future-creating processes and methods.

Think it through.  If you’d like to learn more about how to grow a world-class Decision Management capability this year, please contact me.

John Fitch

New features coming in July

I started work this week on 2 new features that will show up in both Decision Driven® Strategy and Life during July.

First, I’m adding a second Compare Alternatives chart.  The current alternative comparison uses a Tornado Diagram to enable users to compare the relative advantages of any pair of alternatives.  It does a great job of highlighting why Alternative A is superior to B and whether it’s a slam-dunk decision or a close tie between the two.  This works well for most technology decisions that typically come down to 2 or 3 viable alternatives.  However, some portfolio decisions may have 10 - 15 viable alternatives from which you may choose to pursue (implement) 5 to 8 over time.  It takes quite a few pairwise comparisons to discern the best of the best, reorder them based on overall results and determine where to draw the cut-line of a list of projects, products or markets that are competing for the same resources.

To provide a many-at-a-time alternative comparison I’m adding a summary scoring bar chart to the Compare Alternatives window that will highlight the effectiveness of each alternative compared to the “ideal” alternative.  Second, I’m providing a Spider Chart (aka Radar Diagram) view that can compare the effectiveness of up to 5 alternatives (user-selectable) at a time.  My goal is to release the improved Compare Alternatives feature by mid-July.

I’ve also started work on a better Align Roadmaps capability that will enable you to build explicit dependency relationships between alternatives in multiple decisions.  This will make it easier to visualize and manage dependencies among evolving technologies, capabilities, products and markets.  Delaying the availability date of a technology alternative will push out products that have planned to use it.  Along with this feature I’ve planned a filtered version of the Roadmap that shows only the network/thread of alternatives that are linked to/from any specific alternative.  This will help users do a “what-if” to assess the impact if a specific alternative (e.g. technology, feature or product) slips by 9 months.  I plan to release the Align Roadmap feature by the end of July.

If you have additional ideas for capabilities or enhancements, please use the feedback forms on the www.decisiondriven.com web site to provide your inputs.  Thanks!

Decision: Trial Strategy

Almost all new products merit some form of market trials prior to full-scale launch to the masses.  These may be clinical trials in the case of medical devices or new drugs; they may be alpha or beta releases in the case of software.  The decision pattern within the Decision Driven® Strategy web service includes a Trial Strategy branch under the product Life Cycle decision.

The overall Trial Strategy is driven by the need to satisfy regulatory requirements, discover and remove defects and gain additional understanding of user needs and priorities.  The following criteria should be considered when evaluating various trial schemes:

The Trial Strategy decision is framed with the assumption that a set or series of trials may be conducted before the product is ready for prime-time.   If multiple trials are planned based on this decision, then the model fans-outs at this point into a set of N Trial Concept branches (1 for each trial envisioned).

Each trial may vary in its participants, usage scenarios (scope of the product exercised, situation/context of its use), trial methodology and its execution team.  These may be fairly simple decisions driven by SOP (Standard Operating Procedure) or they may call for creative thinking on how to maximize the knowledge gained from the trial in the face of tough regulatory, time or cost constraints.

Multi-decision innovation framework

Creating the future is fun!  One of the most enjoyable and profitable uses of a proven decision pattern is as an innovation framework.  If your organization is looking for disruptive, game-changing innovations that propel you to a new competitive position, you need a way to stimulate and align breakthroughs that span multiple business and product decisions.

Start by making your current strategy visible as a Decision Network baseline.  That’s a pretty simple process if you use a proven decision pattern such as the one I provide within the Decision Driven® Strategy web service.  Each decision is a fundamental question/issue that demands an answer/solution.  So you already have an AS-IS or incumbent answer to each decision in the pattern; capture it in a few words as the “committed” alternative for each decision.

As you capture this baseline, be on the lookout for decisions where you are feeling some pain; where the current answer isn’t performing very well.  Perhaps it was a fine solution for a while, but it’s been overtaken by competitor moves or changes in your industry (or soon will be).  Perhaps it’s been a so-so part of your business where mediocrity has ruled from day 1.    By the time you’ve captured your decision baseline, you should be able to identify 5-10 decisions that provide you with a HIGH innovation opportunity; use these decisions as the brainstorming nodes for which you will generate new and disruptive alternatives.

Because each decision is a well-framed question that “begs” a particular type of answer, this brainstorming is highly efficient and focused.  I once facilitated a 2 day Decision Driven® Innovation workshop with 20 participants; 10 each from two Fortune 100 companies that were hoping to do some collaborative technology, product and business innovation.  We identified 8 decisions with a high innovation opportunity and proceeded to brainstorm 30-60 new alternatives for each decision.  We then did a first pass through each decision to pick out the best-of-the-best ideas and threw them into 2 buckets: truly disruptive game-changers and low-hanging fruit (easy to implement ideas that extended their existing technology, product and business roadmaps).

For each of these promising alternatives we then moved to adjacent decisions within the Decision Network pattern and asked “If I could do X (promising alternative), what new answers would it enable for this decision?”.  This led to another burst of ideas across multiple decisions; the ripple effect of a disruptive or next-step solution in one decision flowed to others.

Finally, we looked for synergistic combinations of game-changers and next-steppers and built them into multiple scenarios of the future.  Because these ideas were conceived within a proven decision pattern, we could then use the same Decision Network as an evaluation framework to launch the due diligence to study each scenario.

If you use the Decision Driven® Strategy web service to do this multi-decision innovation blitz, you get the additional benefit of an integrated roadmap view of your data.  Each decision and alternative can be aligned-in-time on this roadmap with other ideas within the scenario.

Decision Driven® Innovation is an advanced use of decision patterns, so I still offer innovation workshops to facilitate this process.  With web technology, these sessions can now be done quite effectively as a series of e-meetings.  If you’re interested in this service, give me a holler.

John Fitch

Decision: Methods Engine

Whether you are a consultant, accountant, university, repair shop or a barber, there is more to offering a high-value, high-performing service that just an intense desire to meet your customer’s needs.  High performing services need a high-performance engine - this engine can be thought of as being a “Methods Engine“.   Within the Decision Driven® Strategy pattern, I’ve framed this decision as “What methods or combination of methods provide the engine for this service?“.

If you’re designing a new service offering or seeking to dramatically improve an existing service, don’t overlook the opportunity to think through the Methods Engine decision proactively and formally.  If you can “swap in” in a new methods engine you may be able to supercharge (and charge more for) an existing service offering.  If you try to launch a new service without designing in an adequate engine, you may stall and crash during takeoff.

The full decision pattern for designing a new service offering is shown below. 

 

The Methods Engine decision appears as a child of the overall Service Concept.  When making this decision, consider the following criteria:

A very similar decision, Core Methods, appears withing the Capability Design decision pattern.  Process core competencies are typically built around a methods engine that powers the capability.

Strategic vs operational excellence

I continue to run into folks who are pouring mucho money and effort into applying six sigma techniques to everything.  Six sigma provides a rich toolbox for continuous, incremental improvement of existing processes and systems; it’s great for helping organizations achieve operational excellence.  But the same things that make six sigma work in the operational world, doom it to futility in the area of strategy and particularly strategic innovation.  High volume, short cycle-time transaction-oriented processes can be counted, measured, charted and analyzed for trends/patterns.  That’s great for improving a city’s ability to fill potholes.  It won’t help them decide whether to spend 100 million taxpayer dollars on a not-really-needed baseball stadium in hopes of stimulating downtown revitalization.

Strategic excellence requires a very different set of skills and tools.  The future hasn’t been invented yet; it can’t be measured or analyzed.  Any numbers that can be generated concerning the future are estimates; it will take months or more likely years before the accuracy of these estimates (decision outcomes) can be known.

Strategic excellence requires the outstanding decision management skills.  This includes the ability to leverage decision patterns so that you can quickly frame a strategic situation as ready-to-attack Decision Network (aka Thinking Breakdown Structure).  These patterns should include a proven set of criteria for each decision so that important factors are not overlooked in the evaluation of alternatives.  Decision management skills also include the ability to use the Decision Network as an innovation framework and to fast-forward these decision into the future as a set of strategic roadmaps.  Decision management Black Belts also understand the relationships between decisions and requirements, risks, opportunities, and project plans; they can use the Decision Network as a knowledge framework.  They know how to maintain continuous traceability and alignment between the value-creating decisions and all of the lesser objects/artifacts that represent or realize a strategy or design.

Operational excellence can only take an organization so far; even the leanest, meanest process can be made obsolete overnight by a competitor’s strategic leap.  Strategic excellence, powered by a world-class decision management capability, is a better investment.  So if you’re spending $1M this year on six sigma rollout, I’d encourage you to carve off at least $100K of that to start growing your decision management capabilities.

John Fitch

WIIFM - Why should I master decision management skills?

What’s in it for me?  Why should I expend the effort to master decision management skills?  Here are a few reasons:

• Career growth: The greater the breadth and depth of decisions that you master, the more valuable you are to any employer.  More money.   Job security.  Some folks can make or assist in only a very narrow set of decisions (e.g. user interface software design or marketing strategies); they are much less valuable than individuals who can cover the whole range of decisions faced by an organization. 
• Better working conditions: You either manage and make decisions, implement the decisions of others or get stuck operating the systems that others create and implement through their decisions.  “Stuff” flows downhill, so being stuck at the bottom means that you get to experience daily the consequences of other folks’ bad decisions.  Not fun.
• Create the future: Decision create the future and proactively managing your life or business decisions gives you maximum control over your destiny.
• Create the future: Decision create the future and creativity is fun!
• Confidence in any situation: Once you master decision management (which includes, but is much more than decision-making) you are a few questions away from being in control of any situation that requires forward-looking thinking.  You get to lead, not because you have a lofty title or talk assertively, but rather because you’re 1, 2, or 10 thinking steps ahead of your peers.
• Simplify everything: Seeing the decision patterns in any situation and knowing how all information connects to these decisions makes every situation as simple as it can be.  Most of your peers won’t know how decisions connect to risks, requirements, project plans, roadmaps, estimates, models, prototypes or tests; you will with perfect clarity.  There will still be mysteries in life, but they won’t involve decisions.
• Help others:  The individual who has mastered decision management skills and decision patterns can be more effective as a mentor or counselor to others.
• Decision speed:  Knowing what questions to ask and data to gather and being able to efficiently process through these inputs will make you a fast, yet high quality decision-maker.
• Decision quality: Bad decisions close doors; good decisions increase our freedom of action.  Mastering decision skills can’t always guarantee great outcomes from your decisions, but certainly increases your chance of success.
• Collaboration skills:  Most of the important stuff in life or business takes cooperation with others.  Decision management skills are the key to communicating and collaborating in a way that makes everyone a winner.

Where do you start?  Sign up for a Decision Driven® Strategy or Decision Driven® Life trial today!