How to: make optimal decisions

An optimal decision is characterized by following points:

• decision is done at the right time
• decision improves the situation
• only a reasonable amounts of resources are  needed, to prepare and realize the decision.

In larger companies or organizations, the decision process is not done by one person only, but by a team and the final decision has to get approved by several levels in the hierarchical organization.

That process is not only time consuming, but also in danger, that important information gets lost or is not well understood by all involved people.

Therefore it is very important, to describe the goals and the path to reach them, in clear terms.

At the beginning of the decision process, one faces as a typical situation:

• the team and the involved decision makers are poorly organized
• the goals are ambiguously defined
• there can be even conflicting goals
• the problem itself is not well defined and oftenly poorly structured

To overcome these starting conditions, following procedure should be used:

• form a core team of 3 to 5 people. This team structures and finally defines the problem
• The team should have members with diverse skills, if a technical problem must be solved:
• 
  
  domain expertise,
• 
  
  scientific expertise
• 
  
  applied science
• 
  
  engineering skills.

This core team defines possible goals and concepts, how to realize them and writes a report, which covers:

• goals and objectives
• alternatives
• Identification of key variables
• relationships among variables

The core team works together with an advisory team. The advisory team should have senior engineers and commercially minded people as members.

The advisory team discusses this report in detail with the core team and makes proposals, how to clarify some points further and how to prepare a decision about the final goal.

After the core team has done the suggested corrections and the advisory team has reviewed the final report, it is given to the next level in the hierarchy for approval.

This process may need some further reviews, before a general meeting with all involved people in the decision process can be made, in which hopefully it is also decided, what shall be done and what resources will be available and what the time schedule shall be, to realize the goals.