Reference no: EM131816905

What if you haveto make a decision and you just don't know which way to go? For complex issues like outsourcing, it can be difficult to know what the right decision is.

In many cases, more analysis won't necessarily reduce the uncertainty. Consider outsourcing as a typical, complex, real-life decision problem. The question is, will outsourcing save your organization money? Will the cap on financial exposure be worth the loss of control?

Or, is your organization avoiding managing the IS function because you would just like to have the whole IS mess out of your hair? Suppose the CIO is adamantly opposed to the outsourcing of computer infrastructure. Why is that?

He is obviously biased, because such outsourcing will mean a huge cut in his department and a big loss of control for him. It might even mean he loses his job. But is that all there is to it? Or does he have a point? Are the projected savings real? Or are they the result of a paper analysis that misses many of the intangibles?

For that matter, does that analysis miss some of the tangibles? You could do another study; you could commission an independent consultant to examine this situation and make a recommendation. However, is that avoiding the issue, yet again? Further, what if there is no time? The network is down for 2 days for the third time this quarter, and you've got to act. You've got to do something. But what?

Take it to the board of directors? No, they don't know. That's just another way of avoiding a tough decision. You've got to decide. In some ways, higher education does you a disservice. In school, you're taught that a bit more study, another report, or a little more analysis will help you find a better answer. But many decisions don't work that way. There might not be the time or money for another study or another study might just cloud the issue more. Or maybe it's just not possible to know. What will be the price of Google stock on January 1, 2015? You just don't know

Discussion Questions

1. Suppose you are the CIO and you are opposed, on what you perceive as legitimate grounds, to an outsourcing proposal. Suppose you know that everyone on the steering committee thinks you're biased because your department will shrink. What can you do to increase your credibility?

2. Suppose you're on the steering committee and you know that the CIO is biased about the outsourcing proposal. What questions can you ask to assess the degree to which his bias is influencing his position?

3. Describe a situation where you were in a biased situation and you needed to convince others to believe you, despite your bias What did you do? Did it work?

4. Suppose you have to make a decision and you feel you don't know what you need to know to make that decision with confidence. Does it help to consider the cost of a mistake? How? Does it help to consider the cost of undoing your mistake? How?

5. Some executives say there's always more time than you think You can always find a temporizing measure to buy yourself more time. Others say that it is critical to be decisive; make decisions when you have to, with the best knowledge you have; and get on with the next issue. Which view do you take with regard to the situation described here? Why?

6. One theory holds that some people are just better decision makers-that when given very little data, some people just have the knack for making good decisions. Others contend that there is no such difference; some people are just luckier. Or, some people have the knack for managing their affairs so that they never have to make a decision with little information. What do you think?

7. In the scenario presented, the CEO is frustrated and wants to get the IS mess out of her hair. How do her emotions cause her to second-guess her decision process? What role do you think emotions should play in a decision?