We live in a non-linear world that is neither predictable nor stable. Sometimes we may feel that we may just as well 'throw the dice' since making decisions seem like playing an unpredictable game. What we need are better tactics and tools to improve our decision-making process. All decisions are about the future, and the future is uncertain. In this seminar we will examine the decision-making process itself to find better ways of managing an uncertain future. We will examine the fundamental concepts that we learned in management accounting and will challenge some of the conventional wisdom and correct some common misconceptions.
Learning Objectives
After attending this presentation, you will be able to...
- Assess your current decision-making process.
- Recall better plans and approaches to minimize uncertainty
Major Topics
The major topics that will be covered in this course include:
- Better plans require more planning; what do we need to change in our decision process?
- How to use the OODA loop and other decision models?
- New lessons from the Judgement of Solomon
- Why the best performing organizations always plan for the unexpected (multiple scenarios always)
- Experiments always lead to success.
- Tools to deal with randomness, including the Scientific Method, re-framing, and periodic reality checks.
- Choosing the right, relevant costs?
- The sunk cost fallacy reexamined
- Opportunity costs
- Relevant costs for responsibility accounting
- Product or process continuance or discontinuance
- Fixed costs vs avoidable costs. Short run and long run
- Decision dynamics; how can today’s right decision turn sour tomorrow?
- Unintended consequences
- Selling surplus capacity
- How statistics can be misused and misunderstood – thus increasing risk
- Real options increase certainty by making us more flexible
- All risk is subjective, but we futilely attempt to quantify the unquantifiable
