How do you make decisions?
According to neuroscientists, our brains are wired to enable us, even unconsciously, to make the best possible decisions with the evidence we have available to us. That’s obviously a relief! Studies show that different kinds of decisions involve different parts of the brain. The frontal lobe, an area which is used for planning and reasoning is important for making abstract decisions – deciding what to study at college for instance. Concrete decisions, such as the physical movements you make when you do sport are made at the back of the brain and decisions made using visual information are made in the ‘parietal lobe’.
When it comes to making decisions in business, it’s safe to assume our frontal lobes will be fully engaged, using all the information available to us to make the best decisions for our companies. However, this is the catch; in business, as in other areas of life, we rarely have the ‘full picture’ in front of us. When deciding to hire 100 new contractors, putting a project on hold or slimming down and reducing resource portfolio capacity, decision makers often have to make these major choices with only limited information at hand. Making business decisions has always been complex and can have major repercussions. However, in today’s competitive and unstable market, companies need to be even more agile, ready to alter strategy at the drop of a hat.
So, what can organizations do to reduce risk and feel more confident in their resource management choices? The power of modelling plays a pivotal role.
A recent PWC survey showed that despite the growth of Big Data, most executives around the world today rely more on experience and advice than data for ‘business-defining’ choices. So, how are decisions made today?
As the chart above shows, a large proportion of decisions today, whether they relate to strategy, vision or resource portfolio management are made using gut feeling and the intuitive advice of others. Of course, experience counts for a lot, yet the same survey showed that decisions made using data reported a significant improvement in their decision making process. As neuroscience proves, when making decisions, our frontal lobes light up and make the best choices with all the information available to us. So, why not make decisions with all the information held within our organizations?
From architectural blueprints to maps to Project Management software, many of our plans are based on representations of real life. Models take this one step further by letting us explore alternative versions of real life. Using the power of modelling, we can ask all sorts of questions of our plans, and importantly, find better alternatives to our existing intentions.
You see, models provide a powerful method for organizations to analyze all the options available to them. Crucially, testing our theories in a model allows us to make the most informed decisions, reducing risk and leaving less to chance. They mean we depend less on instinct, advice and opinions which can only see part of the reality, and instead explore many more alternatives. Resource management questions you might want to ask might include:
- What would happen if we increased our resource capacity portfolio?
- What if we paused Project 1?
- What will happen to our long term strategy if we downsized resource capacity across our projects?
Decision makers and resource managers are faced with these kinds of choices every day. Using a model to find out what would actually happen if the idea was implemented means you can feel far more confident that your plans are well founded and help you avoid making disastrous choices.
The modelling features in Tempus Resource offer a unique, innovative and easy to use solution for organizations to model different alternatives. Your organization’s Resource Manager or PMO can quickly build powerful models from existing project portfolios and resource databases. They can then rapidly test your ideas.
Whether you plan to reduce headcount, put a project on hold or add a number of new projects, you instantly see the outcomes of this decision. Perhaps one choice would result in your resource portfolio being incredibly overstretched and therefore unproductive. Discovering this result before you make the decision could save you a lot of time and money. You might also see that another choice would have positive outcomes, yet seeing the long term impacts on screen, you might realize that an alternative solution would be even more beneficial.
When you base organizational choices on models in Tempus Resource, your decisions depend less on instinct and experience and more on solid, dependable information. Keen to find out more about the power of modelling and resource planning? See our case studies to see how our resource management tool helped other organizations make the best decisions.