3. Objective
• Increase quality and timeliness of decisions during
unexpected situations that involve:
• Personal stress
• High consequence
• Inadequate information
• Insufficient time
• High visibility by others
Applies to: Large and small crises
Work and personal situations
4. Crisis Decision-Making
Effective even when: Personally overwhelmed
Self
Skills
Skills Planning
Crisis
Management
Training/ Integrated
Exercising/ Team Plan
Incidents
Team overburdened &/or Plan inadequate
5. Crisis Decision-Making
Focus on: Self
Skills
Skills Planning
Strategic
Crisis
Training/ Preparedness Integrated
Exercising/ Team Plan
Incidents
“Chance favors the prepared mind”
Dr. Louis Pasteur
7. Decision-Making Context
Decisions made when:
• Partial information
• Time is limited
• Future is uncertain
University
“You have to understand how fast
things were occurring.”
Charles Steger, President
VA Tech University
8. Decision-Making Context
Mumbai, India 26 Nov. 2008
• Man made vs. natural
• Your fault vs. victim
• Blame and outrage
• Crisis history
• Reputation
• Perception vs. reality
• Tested crisis plan/team Man Made
Explosion
• Business disruption
• Long- vs. short-term
• People killed vs. only $
• Your company vs. many Hurricane Katrina
9. Crisis Decision-Making
Quality of a decision is
False Assumption: directly correlated with
time and effort invested
________________________________
• Weigh all alternatives
• Haste makes waste
• Look before you leap
• Don’t judge a book by its
cover
• List pros and cons
What if we took our instinctive
decisions seriously during crises ?
10. Science of Intuitive Decision-Making
How people make
judgments and
decisions
. . . in uncertain
situations
Men are as accurately intuitive
• Based on research
as women
• Max Plank Institute for Human Development,
Berlin, Germany [Study of 15,000 people]
13. Crisis Decision-Making
Anatomy of gut-level judgment:
• Strong enough to act upon
• Appears quickly in consciousness
• Not fully aware of underlying reasons
For prepared professionals,
gut-level decisions:
•More accurate when based on
“one good reason”
•Less prone to estimation and
calculation errors
Research: Max Plank Institute for Human Development, Berlin, Germany
14. Unconscious Rules of Thumb
Four decks of cards:
Each card:
Wins or loses money
“Adaptive Unconscious”
Findings . . .
80 vs. 10 cards
Research: U. of Iowa: Bechara, Damasio, Tranel, Damasio (1997)
15. Crisis Decision-Making
Simple Rules of Thumb
• Can predict complex
phenomena
. . . as well or better than
• Complex rules do
16. Crisis Decision-Making
Simple Rules of Thumb
Contradict 2 core
beliefs:
• More information is always
better
• More choice is always better
17. Crisis Decision-Making
Simple Rule of Thumb
Based on . . .
• One good reason
• That’s good enough
Research: Catching a fly ball
Picking stocks
Putting a golf ball . . . less is more
18. Simple Rule of Thumb
Catching a fly ball
• Analyze:
• Speed of ball
• Wind speed and direction
• Trajectory / angle
• or, Watch only . . .
• Fixed angle of ball in the air
• Rising = go back
• Falling = run up
Keep your eye on the ball
and adjust accordingly
19. Simple Rule of Thumb
• Capital Magazine
• Stock-picking contest
• 10,000 participants/ 6 weeks
• 50 international Internet equities
• Asked 100 pedestrians in Berlin
• Identified recognized stock names
• vs. mutual fund managers and
financial experts
Stocks • Recognized stocks did 47% better
than fund managers and experts
Go with what you recognize
Research: Ortmann et. al., in pres; Barber and Ordean, 2001
20. Simple Rule of Thumb
• Research with pros and
beginning golfers:
• #1 = Talk about every part
of putting before hitting ball
• #2 = Put the ball within 3
seconds
• Findings:
• Pros did worse when
thinking about it (#1)
• Beginners did better (#1)
• Pros did better without
thinking (#2) Once you skill is developed,
• Beginners did worse (#2) don’t over think your decision
22. SIP-DE Strategic Response
• Scan
• Crisis fact pattern
• Identify
• Problem area(s)
• Predict
• Likely progression
• Decide
• Based on anticipation
“Spatial Pattern Recognition” • Execute
• Sequential by priority
23. Crisis Leadership Checklist
• Strategic Mapping
• Define the crisis (beyond the obvious)
• Impact on core assets?
• How can the situation escalate?
• What would successful resolution look like… for each stakeholder?
• Stakeholders
• Anticipate needs of every affected stakeholder
• What would you want if you were in their position?
• Impact
• What would be the impact of our actions? (Intended vs. Unintended)
• Implementation
• What needs to: Start? Stop?
• Who is going to do it? (Reports to whom?)
• Timing? (Immediate, Delay, Defer?)
• Communications to and from each appropriate stakeholder
24. Crisis Leadership Checklist
• Strategic Mapping
• Define the crisis (beyond the obvious)
• Impact on core assets?
• How can the situation escalate?
• What would successful resolution look like… for each stakeholder?
• Stakeholders
• Anticipate needs of every affected stakeholder
• What would you want if you were in their position?
• Impact
• What would be the impact of our actions? (Intended vs. Unintended)
• Implementation
• What needs to: Start? Stop?
• Who is going to do it? (Reports to whom?)
• Timing? (Immediate, Delay, Defer?)
• Communications to and from each appropriate stakeholder
25. Crisis Decision-Making
Colin Powell: 40-70 Rule
• Army General
• Chairman of the Joint Chiefs of Staff
• U.S. Secretary of State
• Once information is in the
40-70% range:
• Go with your gut
• Judgment is more important than
additional data at this point
• Waiting until 100% sure = too late
Beneficial point where gut feeling outperforms
more knowledge and information
28. Objective
• Increase quality and timeliness of decisions during
unexpected situations that involve:
• Personal stress
• High consequence
• Inadequate information
• Insufficient time
• High visibility by others
Applies to: Large and small crises
Work and personal situations
29. Crisis Decision-Making
For:
Asia-Pacific Security Conference – February 2009
Bruce T. Blythe, CEO
www.cmiatl.com
404-841-3400
