DECISION MAKING TOOLS

DECISION MAKING TOOLS

1. What is the Pareto Chart?

   • A Pareto chart is a technique that allows you to graphically classify information from most to least relevant, with the aim of recognizing the most important problems that you should focus on and solve them. This technique is based on the Pareto principle or 80/20 rule, which establishes a relationship of correspondence between the 80-20 groups, where 80% of the consequences come from 20% of the causes. The Pareto diagram, also known as the ABC distribution curve, consists of a graph that classifies the aspects related to a problem and orders them from higher to lower frequency, thus allowing a clear visualization of the main cause of a consequence. .
     • Characteristics
       • It is a simple calculation technique.
       • Analyze the characteristics of a group and recognize the most important points within it to give them priority.
       • It allows you to make objective decisions that are based on data and not on personal opinions.
       • Look at the elements and focus your efforts towards a single goal.
       • Analyze the elements and the frequency with which each of the data occurs.
     • ELEMENTS
       • Left Y axis. Corresponds to the frequency with which a problem or situation analyzed occurs.
       • Right Y axis. It refers to the percentage that is accumulated from the total number of occurrences.
       • X axis. In the lower part, the categories of the problems or situations that are being evaluated are described.
     • What is it for ?
       • Analyze the different products and services you offer and improve their quality.
         • Observe the production of products in time and volume.
         • Identify which products generate the most sales and which have the longest storage time.
         • Recognize opportunities to improve your business.
         • Identify what are the reasons why some problems occur and prioritize solutions.
     • Advantages
       • It helps you focus your efforts on the improvements that will bring the most benefits.
       • It offers a simple and effective panorama on the priority of the problems.
       • It prevents problems from getting bigger.
       • It is an easy-to-understand tool and encourages the desire to solve problems within the organization.
     • How to make a Pareto Chart?
       • Find out what the problem is, collect the data and select the ones to be analyzed.
       • Rank information in order of priority, from highest to lowest.
       • Arrange the data in a table from highest to lowest and calculate the percentage of each.
       • Trace the graph. First the vertical and horizontal axes, then draw the left vertical line for the frequency.
       • Draw one for each group from largest to smallest.
       • Draw the right line that represents the cumulative percentage.
       • Draw a curve joining the points to represent the total for each group.
       • Put the corresponding data on the diagram: title, date, period covered, the source of information, etc.
       • Analyze the graph and establish which are the vital points and which need to be attended to with priority.

2. ISHIKAWA'S DIAGRAM

   • It is a tool that identifies quality problems and provides solutions by graphically representing the factors that involve the execution of a process. It is also known as a cause-effect diagram or the 6M diagram
     • HOW IT HELPS ISHIKAWA ́S DIAGRAM?
       • The great help that the Ishikawa diagram provides to your business is to facilitate the visualization of problem causes. And this because its fishbone format allows us to more clearly observe the stages and processes and identify the driving principles of the problems. And then solve them
     • ADVANTAGES
       • process improvements
       • Identification of causes
       • Ranking of the causes found
       • Increased visibility of problems
       • Visual record, facilitating future analysis
     • DISADVANTAGES
       • Very simple
       • Large structure
       • Does not prioritize causes
       • Can be very subjective
       • Be a waste of time
     • STRUCTURE
       • Build amultidisciplinary teamof people
       • Start with a blank diagram. Logically to fill itfrom scratch
       • Write concisely the problem or effectthatis occurring
       • Identify the categoriesinto which the causes ofthe problemcan be classified
       • Identify the causes
       • Ask the why of each cause
     • TYPES
       • Cause and effect diagramwith the 6mmethod
         • It is a tool that identifies quality problems and provides solutions by graphically representing the factors that involve the execution of a process. It is also known as cause-effect or 6 M diagram. Kaoru Ishikawa is the creator of this methodology that he developed in 1943.
       • Proccesflowmetodh
         • A Flow Chart represents the graphic outline of an algorithm, which graphically shows the steps or processes to follow to reach the solution of a problem. Its correct construction is extremely important because, from it, a program is written in some Programming Language.
       • Stratificationmethod
         • METHOD OF STRATIFICATION OR LISTING OF CAUSES The idea of this Ishikawa Diagram construction method is to go directly to the main potential causes of a problem. The selection of these causes is often done through a brainstorming session.
       • Simple Fish Diagram
         • also known as fishbone—is a visual tool that has a graph format. In addition, its main function is to assist in organizational analysis. Most of the time it is used to find the root cause of a problem.

3. BRAINSTORMING.

   • -Brainstorming is an unstructured technique for work groups, where solutions to various situations are sought by generating spontaneous, relaxed and horizontal ideas.
     • What is it for?
       • Brainstorming will allow you to find new points of view from colleagues you see every day, but may not always recognize as your allies in creativity. In addition, it is one of the best tools to unlock inventiveness, whether yours or that of your team members. It can give you amazing results once you establish that atmosphere of trust, even the most timid may express what they think about a topic. The best thing is that you can give different approaches, both in the subject to be addressed and its delimitation as well as doing sessions of approach to this technique or for an urgent project.
     • Features.
       • You need a moderator.
       • It has a well-defined goal.
       • The session has a set duration.
       • The number of participants, generally, does not exceed 15 so that it does not take too long.
       • Try to get as many ideas as possible, especially since the first ones will be the least inspired or the most obvious.
       • Everyone who joins the session should contribute proposals.
     • Advantages.
       • -It puts at your disposal diverse ideas, where some will be very valuable for your projects.
       • Promotes criticism, which is necessary even when the activities of a team or department are going well.
       • -It helps you eliminate obstacles in the creativity of a team regarding a more or less specific issue.
       • -It allows the barriers between its participants to be reduced, either by its work group or by its hierarchy.
       • -It positively influences the dynamics of work as it is an extraordinary moment in the day to day.
     • Disadvantages.
       • As well as revealing valuable ideas, most of them probably aren't relevant to the project you have in mind.
       • It is likely that some people, for fear of public speaking or making mistakes, do not express their comments.
       • It can encourage clutter if ideas don't focus on the required topic.
       • Often, it happens that only some collaborators actively participate, while others will only say "yes" or "no" to their proposals out of laziness to get involved.
       • If you don't make a proper selection, you could follow an idea that isn't so convenient. Remember that even innovation requires certain rules.
     • Types
       • -Round Robin. -Role storming. -Direct. -Inverse. -Star. -Gordon. -Individual. -Mind map. -What if...?

4. Decisions Tree

   • It is based on classification principles that predict the outcome of a decision, giving rise to different branches of a tree. Part of a root, which gradually has different decision nodes. The structure has termination nodes at the end.
     • Importance
       • We can solve a problem covering all possible aspects.
       • It plays a crucial role in decision-making as it helps us weigh the pros and cons of different options, as well as their long-term impact.
       • No calculations are required to create a decision tree, making them ideal for all industries.
       • These diagrams can be used to represent all kinds of both categorical and continuous scenarios that may be difficult to represent otherwise.
       • Today, decision trees play a critical role in futuristic technologies like machine learning and artificial intelligence.
       • They can represent both quantitative and qualitative data in a visually appealing way and without applying too many calculations.
     • Symbol
       • Decision Node
         • Indicates a situation in which a decision must be made and is represented by a closed square. This is how most decision tree diagrams start.
       • Chance Node
         • When we are not sure of the outcome of a situation, we represent it with a chance node. It can produce multiple results, but in most cases it is recommended that it only produce two results at a time. This node is represented by a circle.
       • End Node
         • These are the leaf nodes that represent the end of the decision diagram. No more branches are expected from an end node. A small triangle is used for a terminator or end node.
       • Branches
         • Every time a decision is made, it leads to different nodes. A branch connects these nodes and represents a situation or a result. The result is usually written on the branch in plain text.
       • Rejected option
         • This is an optional symbol in a decision tree that is drawn after the entire diagram has been created. We simply mark it on the branch of the option that we want not to continue. Rejected option This is an optional symbol in a decision tree that is drawn after the entire diagram has been created. We simply mark it on the branch of the option that we want not to continue.

5. SYSTEM APPROACH

   • It is also known as systems theory, systems thinking, or systems thinking. It consists of a method of analysis to obtain a broad reasoning and critical thinking in relation to the phenomena, problems and situations that occur within a system. The systems approach is based within the fields of biology, sociology, psychology, anthropology, philosophy, economics, mathematics, business administration, and engineering. Understanding things in a systemic way consists of placing them within their own context and relating them to each other, literally. For example: the elements and factors of a given phenomenon.
     • BACKGROUND OF SYSTEM APPROACH
       • The ideas of the systemic approach are not new, since Greco-Roman antiquity attempts were made to establish the laws to which the formation of a knowledge system obeys. Over time, many authors have used the systemic approach to study the elements that make up certain processes. For example: in the mechanics of the seventeenth and eighteenth century, the investigation of various objects of some systems was carried out
     • It can be especially useful for obtaining a broader context of a problem or situation to be faced. It will always go from the general to the particular. It is complex in all its processes and analysis, since its processes of interrelation of elements can be slow. Your experience in this type of projects and methods will allow you to prevent future problems and identify patterns and strategies to solve them. This approach is especially useful in team work or projects, especially if you have to lead them. You will obtain many strategies and tools to deal with both work and academic situations. It is also useful when applied to aspects of everyday life.
     • Being able to control various aspects of your life, such as social, economic and health, among others. These learnings and methods will allow you not only to solve these problems, but also to predict them and discover their origin. You will be able to have better direct communication and improve your reasoning processes. You will stop blaming others: this means that failures in systems do not come from one component or one person only, but from the whole and its relationships.
     • Components Components are all the elements that make up the system. For example: in the teaching-educational process, the "non-personal" components are the objective, the content, the method, the means, the form and the evaluation of the teaching. Structure The structure comprises the relationships established between the elements of the system. It is based on a selection algorithm, that is, on a logical ordering of the elements. Functions The functions are the actions that the system can perform, both vertical subordination and horizontal coordination. Integration Integration corresponds to the mechanisms that ensure the stability of the system and are supported by cybernetics and management. This is confirmed by evaluative controls that allow feedback. To ensure that a systemic structure has been carried out, the following should be checked: If removing an item breaks the system. If the set reinforces the function of the isolated elements. If the performance is really superio