Post on 28-Jan-2015
description
Decision Analysis Framework
Overview
Big Sky can help optimize the most important parts of a core business process – the key decisions
Our approach to doing it involves four steps, which can be adopted as part of a larger process improvement effort
This short briefing explains the steps and the considerations of each
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Our Approach
Define Core
Capability
Document its
Process
Identify Critical
Decisions
Optimize Decisions
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Step 1: Define Core Capability
All organizations have a relatively small number of core capabilities – those functions they must perform well
Core capabilities are driven by the organization’s strategy
Before any work on decision optimization can begin, those critical capabilities are identified (or validated) by our clients
Big Sky can help an organization identify those capabilities if they have not already been well defined
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Define Core
Capability
Document its Process
Identify Critical
Decisions
Optimize Decisions
Step 2: Document its Process
All capabilities may be defined as a process Before optimizing decisions, Big Sky helps to document the
process that creates a capability, making sure to carefully document each decision point
Big Sky chooses the right approach for the process based on its complexity, and may include value stream mapping, process mapping, swimlane diagrams, or process models or simulations
In many engagements, Big Sky helps a client to both optimize a process using traditional improvement techniques while simultaneously optimizing decisions in the process
© Big Sky Associates, Inc.
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capability
a b c dprocess
Define Core
Capability
Document its Process
Identify Critical
Decisions
Optimize Decisions
Step 3: ID Critical Decisions
© Big Sky Associates, Inc.
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capability
a b c d
dcba
ca
process
decisions
critical decisions
Define Core
Capability
Document its Process
Identify Critical
Decisions
Optimize Decisions
Once the process describing the capability has been thoroughly documented, Big Sky helps to identify those decision points which are most critical to process success
Each decision point is treated as a critical input variable x which drives the process outcome y. The process outcome y might be customer service, quality, speed or some other capability objective
The decisions that have the greatest impact on y are selected for optimization
Step 4: Optimize Decisions
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capability
a b c d
dcba
ca
Strategy
Technique
Technology
Strategy
Technique
Technology
process
decisions
critical decisions
optimized decisions ca
Define Core
Capability
Document its Process
Identify Critical
Decisions
Optimize Decisions
How to Optimize
After critical decisions are identified, Big Sky uses a 3-part approach to optimize each
First, we assess the linkage from the decision to overall corporate strategy
Second, we assess the technique used to make the decision
Third, we evaluate what technology is used to support decision-making
© Big Sky Associates, Inc.
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Strategy
Technique
Technology
Define Core
Capability
Document its Process
Identify Critical
Decisions
Optimize Decisions
© Big Sky Associates, Inc.
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How to Optimize: Decision Strategy
THE ANGLE: Decisions start with a purpose. Big Sky helps clarify how a decision ties to strategy in specific, measurable terms. METHODS:• Capability Analysis• Critical Decision
Identification• Value Chain Analysis • Budget Analysis• Financial Analysis• Strategy Validation• Organization Analysis
Strategy
Technique
Technology
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How to Optimize: Technique
THE ANGLE: A good carpenter chooses the right tool for the job. Big Sky helps select the right decision tool for your situation, regardless of whether it’s a complex recurring supply chain problem or a one-time strategic choice. METHODS:• Hypothesis testing• Analytic Network Process • Analytic Hierarchy
Process• Decision Trees• Real Options• Group Consensus
Strategy
Technique
Technology
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THE ANGLE: Good decisions result from a qualified decision maker armed with the right information, delivered at the right time in the right context. Big Sky helps define an architecture optimized for effective decision-making.
How to Optimize: Decision Technology
METHODS:• Business Intelligence• Group Decision Tools• Context-Dependent
Models• Visual Control Tools
Strategy
Technique
Technology
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Finally, Big Sky makes change last by compressing decision cycle time (DCT), reducing decision error, and reducing decision waste. By applying lean, six sigma, and process improvement techniques and principles, Big Sky helps make lasting, measurable change in decision fundamentals.
Making decisions stick
METHODS:• BPR/Process Improvement• Lean Process Design• Six Sigma (DMAIC)• Rapid Decision
Improvement
Strategy
Technique
Technology
© Big Sky Associates, Inc.
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