Introduction

How do you decide how to decide? What are the best strategies for problem-solving? This collection of articles from MIT Sloan Management Review explores the critical importance of knowing what problem you are trying to solve, taking the time to thoroughly frame a decision and explore the full scope of options, and recognizing that consensus isn’t always the best policy.

From “The Most Underrated Skill in Management”:

• Few questions in business are more powerful than “What problem are you trying to solve?”
• Leaders who can formulate clear problem statements get more done with less effort and move more rapidly than their less-focused counterparts.
• Stopping to develop a problem statement doesn’t come naturally — managers must put conscious effort into learning a structured approach.
• The article includes a version of A3, a famous form developed by Toyota, that has been modified to better enable its use for tracking problem-solving in settings other than manufacturing.

From “Saving Money Through Structured Problem-Solving”:

• Closely observing how work really gets done in your organization can yield numerous opportunities for improvements.
• Articulating a problem statement can help a manager identify specific gaps between a desired and actual state. Formulating a clear gap between the target and actual state focuses attention on the things that matter.
• Collecting background information is an excellent way to begin the process of determining why a problem is important.

From “Stop Jumping to Solutions!”:

• When presented with complex decisions, many executives turn to the tried-and-true decision matrix, spelling out the pros and cons of various options.
• One flaw in this method, however, is that executives don’t take the time to thoroughly frame the decision and explore the full scope of options.
• The matrix’s real value is when it is also used as a process tool that helps executives expand their set of options and criteria.
• Expanding option spaces in systematic ways can open up new, previously unconsidered possibilities. In an example illustrated with a graphic in the article, an executive started by considering whether to accept a promotion from CTO to CEO — but by expanding his decision frame, he ended up identifying more options, including corporate jobs in other countries and noncorporate jobs at NGOs.

From “Learning the Art of Business Improvisation”:

• Improvisation is the ability to create and implement a new or an unplanned solution in the face of an unexpected problem or change.
• Improvisation may seem spontaneous, but managers can foster it in innovation projects through the deliberate development of certain processes and capabilities.
• Teams with greater improvisation characteristics are more likely to use agile management approaches instead of the traditional “waterfall” approach to project management.

From “Why Our Minds Swap Out Hard Questions for Easy Ones”:

• Why do people so often make irrational decisions?
• Judgment is often informed by partially reliable or even totally insignificant information that we have just taken in — a cognitive bias that psychologists call “the anchoring effort.”
• “When faced with a difficult question, we often answer an easier one instead, usually without noticing the substitution,” writes psychologist and Nobel Prize winner Daniel Kahneman.

From “Toyota’s Secret: The A3 Report”:

• How does Toyota solve problems, create plans, and get new things done?
• This article from 2009 describes how company managers used a tool called the A3, named after the international paper size on which it fits, as a key tactic in sharing a deeper method of thinking.
• An A3 is composed of a sequence of boxes. Inside the boxes, the A3’s “author” attempts, in the following order, to: (1) establish the business context and importance of a specific problem or issue, (2) describe the current conditions of the problem, (3) identify the desired outcome, (4) analyze the situation to establish causality, (5) propose countermeasures, (6) prescribe an action plan for getting it done, and (7) map out the follow-up process.
• This article includes sample A3s.

From “When Consensus Hurts the Company”:

• How do managers “decide how to decide”? Boards and management teams often try to gain consensus, but that’s not always the best course.
• In the field of statistics, there are two types of errors: errors of commission and errors of omission (also known as Type I and Type II errors). In business, an omission error means missing a good project while a commission error means pursuing a bad project.
• Research offers insights into when consensus-building is the right way to go and when it isn’t — and how leaders can determine the best form of decision-making for a given situation.
• “By prompting a rule on how the decision will be made — by unanimity, majority, or delegation — you can significantly influence what will be decided,” note the authors.