Rating: 
Summary: Invaluable Tool In This Age of Information
Review: As valuable as information is, it is surprising that so little thought goes into the application of information. The authors of this book delve into the science of decision making to offer several comprehensive models with helpful explanations and illustrations. It reads very simply, which was a turnoff for some of my friends, but the end result is a valuable education in one of the most important aspects of our lives. The material in here will be original unless you've already studied the art/science of decision making, and it is not material that is intuitive, or 'common sense'. Following the advice in this book, I quit my job with nothing lined up one year ago, and it was one of the better career moves I've made.
Rating:
Summary: Making Good Strategic Decisions
Review: Decisions are made every single second of the day by many different people all over the world. But of all those decisions, how many of them are actually 'good' decisions? This is a question that most of us hardly ever think about because we have been faced with many problems/situations and making decisions to most of them without much thought all of our lives. A lot of times we don't question our decisions unless the outcome is unfavorable, but even when it is favorable, it does not always mean the best decision was made. Unfortunately, this is exactly why most of our decisions are not really 'good' decisions. When an individual is in a situation where a decision must be made, how does that person go about deciding what their decision is going to be? Do they know what the real problem is? Have they determined the true objective of their decision problem? Are they aware of the consequences of each choice they have to decide from? These are only a handful of questions that need to be addressed when faced with a situation or predicament where a decision must be made. Some of them may be addressed during the decision making process, but for the most part, there are so many more that are not. Decision-making is a long detailed process that requires a lot of thought and analysis before a decision can be made. Fortunately to help us learn the art of making 'good' decisions, there have been an overwhelming amount of books, articles, and other reading material to help us refine and enhance our decision-making skills.
One such book is Smart Choices, written by John S. Hammond, Ralph L. Keeney, and Howard Raiffa. Hammond, Keeney, and Raiffa have brought together years of research and experience in decision-making into the aforementioned book to educate all of us on how to make 'good' decisions. They are not saying that their method will make all of our decisions easy, but that they will become easier. Smart Choices encompasses a lot of important concepts needed to fully understand the process of making 'good' decisions. Hammond, Keeney, and Raiffa provide us with a step by step process to making 'good' decisions that can be applied to many different aspects of our lives. Not only will we be able to apply these concepts professionally, but personally as well. The authors of Smart Choices believe that the foundation of 'good' decision-making consists of eight specific elements, which are Problem, Objectives, Alternatives, Consequences, Tradeoffs, Uncertainty, Risk Tolerance, and Linked Decisions. Of those eight elements, the first five are the keys to becoming an effective decision-maker and will be part of every decision problem. The remaining elements help to justify and clarify decisions and may not always be incorporated. Now they refer to the first five elements as PrOACT, which they feel will help us to remember that the best way to approach a decision situation is to be proactive and seek them out instead of waiting for them to come to us. They are trying to express to us that by being proactive and seeking them out, it enables us to avoid being in a position where a decision has to be made immediately and we are not prepared to really make the best decision. They feel that being proactive is invaluable in becoming the best possible decision-maker. I agree with them that being proactive is important, but I don't necessarily see how feasible it is during our everyday lives. I feel that most people are not going about their day trying to find decision situations because they already so much going on in their lives and in their minds. I know that I don't, and maybe that is why I have not always made 'good' decisions. I see why it is important to be proactive because it does enable us to give ourselves the proper time to think them through and make 'good' decisions.
After reading through Smart Choices, I do understand the importance of finding them before they find me and have been trying to incorporate it in my everyday life. Problem is the first of eight elements that Hammond, Keeney, and Raiffa believe start the process of 'good' decision-making. Defining the problem is the basis for the entire process. It is extremely important that enough time is spent on making sure that the 'true' problem is determined. How we tackle a decision influences what we decide in the end. A lot of 'good' decisions can become bad decisions if the root problem is not correctly defined. In order to truly determine what the real decision problem is, Hammond, Keeney, and Raiffa state that we must be creative and look at each situation in different ways other than the most obvious one. This way we can increase the potential of defining the true problem and giving us more and better options to decide from. This part of the decision process seems so logical, but I feel is something that a lot of us take for granted. Reading Smart Choices definitely helps to reiterate the little things that almost all of us know, just neglect or fail to implement. Another key to finding the right problem is going into your decision-problem with a positive attitude. How we feel about a situation has an overwhelming influence on our final decision. Being optimistic instead of pessimistic will help to make the decision process more enjoyable and beneficial because their will be a positive attitude. This is very true because I know that I have been faced with different decisions where I had positive and negative attitudes and it was definitely easier and more enjoyable when I had an optimistic view. It is a lot harder making decisions to situations where all we think about is the negative outcomes. The other keys to defining the problem are to be open to the impacts and effects of different decisions as well as open to seeking advice and insight from others.
All of the previous concepts will help to define the root to any decision problem. Once its established, it is important to stay focused and be open to continuous review of the original problem because times are always changing, which means that a decision problem can as well. I really enjoyed reading this first part of Smart Choices because it puts 'good' decision making into perspective. So many times mistakes are made at the beginning leading to bad decisions, which also include good outcomes to incorrectly defined problems. The emphasis that Hammond, Keeney, and Raiffa place on spending enough time thinking through and formulating the right decision problem is vital to anyone becoming a decision-maker. The second element is Objectives. This element goes hand in hand with the previous one. A lot of times once the decision problem is identified, we tend to jump right into making the decision much sooner than we should and it turns out to be the wrong one or not the best one. Just like the first element, a lot of time and effort needs to be spent on determining the true objectives, which pertain to what we want to get out of our decision problem.
Hammond, Keeney, and Raiffa have identified five steps to help us master the art of identifying our objects. They are 1) Write down all of the concerns you hope to address through your decision, 2) Convert your concerns into succinct objectives, 3) Separate ends from means to establish your fundamental objectives, 4) Clarify what you mean by each objective, and 5) Test your objectives to see if they capture your interests. By utilizing these five steps, we can come up with our true objectives that will lead to 'good' decisions. One thing that they feel is important has to do with asking a lot of 'why' questions. This helps to clarify things and ensure that nothing is being overlooked and our fundamental objectives have been determined, which are the key objectives that from our original list, are achieved. I think that their explanation of why it is important to determine the right objectives is valuable and extremely valid. I don't think that the majority of us really spend a lot of time making sure that we have our true objectives identified. Hammond, Keeney, and Raiffa do an excellent job of conveying the importance and relevance of there second element of the decision-making process. I definitely agree with them. In order for anyone to become an effective decision-maker, they must be willing to spend time developing the objectives that they want to achieve before rushing into making a decision. The next element of the decision-making process is Alternatives. The alternatives represent all of the different options available to choose from for pursuing the objectives. They are extremely important in the decision making process because they represent the choices we have to choose from and they have direct influence on the final outcome. Hammond, Keesey, and Raiffa express the importance of making sure that we keep two important points in mind when determining our alternatives. They are 1) You can never choose an alternative you haven't considered and 2) No matter how many alternatives you have; your chose alternative can be no better than the best of the lot. They are emphasizing the importance of developing good alternatives and making sure that all of our options have been determined and considered before deciding what to do.
I agree with them emphasizing this because too many times people only give themselves a limited number of alternatives. They don't attempt to give themselves as many options as possible, which will help them to be aware of entire situation. I know that I don't do this enough when faced with a decision problem. The entire process of determining all of the alternatives is a long one. It is one that must be thought out and taken very seriously because it plays a big role in the final outcome of the decision. To help make things easier, Hammond, Keeney, and Raiffa have established several keys to generating more effective alternatives. They are 1) Use your objectives - ask 'How,' 2) Challenge constraints, 3) Set high expectations, 4) Do your own thinking, 5) Learn from experience, and 6) Ask others for suggestions. By using these keys, it will to generate as many quality alternatives as possible. I like the idea of establishing guidelines to help guide us into become better decision-makers. Another that they advise us to do is to always be open to more alternatives, but not to look forever for the perfect one because more than likely, there is never going to be a perfect alternative. Being open to new alternatives whenever they arise is important because things always change and you know when something an alternative that was missed or not a factor is recognized or becomes a factor. Now touching on the idea of not searching for the perfect alternative is a good one. Too many times people search and search and search for an alternative that does not exist because they do not want to accept any of the ones available.
I totally agree with Hammond, Keeney, and Raiffa that we must obtain as many alternatives as we can and at the same time we should not continuously search for the perfect one because it just doesn't exist. I think one of the most important part of their explanation on alternatives pertained to the types of alternatives that we can give ourselves to tailor to our decision problems. There were four different types to be exact. The first one is called a Process alternative. It deals with having a process make a decision for you. The example that they used was flipping a coin to make a decision. The flipping of a coin is a process. I think that this one will work when the decision is affecting other people or things. The example in Smart Choices dealt with flipping a coin to decide between two friends who was going to go to a skate show with the one that got the tickets. The reason why I say this is because I have flipped a coin to make a decision before and if it didn't land on the one I called, I automatically said, 'Best 3 out of 5.' I know that this is only one of many processes that can be used, but I just think that the other options available to help determine alternatives are better. A second type is the Win-Win alternative. This is one that I believe many people are aware of and probably use all of the time. This is when the decision that is made benefits two different parties. I like this one because it makes deciding a decision between several participants an amicable one. This way no one has to worry about the other one getting upset or disagreeing with the final decision and or outcome. I agree with them that this type of alternative is very common and efficient where both parties are satisfied. Information gathering is the third alternative. This deals with obtaining a lot of information of the situation or problem that will help to make a more educated decision. This helps to relieve any uncertainty that might be around about the possible decisions. I feel that this one is very important because in my own experiences, I have seen a lot of alternatives neglected because their real meaning was unknown and no one actually wanted to go find out the true meaning. By not knowing about them, it means that they are pretty much ruled out and really don't matter in the end. They are alternatives, but not alternatives. In other words, they are there for someone to choose, but the person choosing can't choose them.
I think that it is very good that Hammond, Keeney, and Raiffa have touched upon this style because I feel that too many times it is neglected by many people and that they just rule out alternatives that they no very little about. I like this type because it gives someone the opportunity to educate him or herself about a situation and then have them make a 'good' decision. The final alternative that Hammond, Keeney, and Raiffa give us is the time-buying alternative. This has to do with putting off a decision so you can think more about it and evaluate your options. I like this one a lot because I tend to put off difficult decisions as long as I can because I really don't want to be in the position of having to make the decision. A good point that they touch on is that during the waiting period, there is always the chance that things will change for the better as well as for the worse so it may or may not be a benefit to put things off.
I think that Hammond, Keeney, and Raiffa do an excellent job at explaining the different types alternatives we have as well as their importance. The next element is Consequences. I think that this element is extremely important when determining which alternative is going to be chosen in attempt to reach the best decision for any decision problem. The main benefit that I found with this element was their use of a consequence table. A consequence table helps to give a projection of what the future holds for each different alternative, which will hopefully help to eliminate certain decisions and lead to the best one. They gave four steps to help us utilize a consequence table effectively, which are
1) Mentally put yourself into the future,
2) Create a free-form description of the consequences of each alternative,
3) Eliminate any clearly inferior alternatives, and
4) Organize descriptions of remaining alternatives into a consequences table. By using these steps to create a consequence table, it enables us to compare all of our alternatives against each other and decide which ones we know are unfavorable and which ones have potential to be the final choice. It also allows the objectives to be written down on the left-hand side of the paper with the consequences listed underneath the appropriate alternative. I think that this is a great tool because it helps us to really picture what our options as opposed to trying to remember everything. It helps to make things more black and white instead of gray because things are a lot easier to understand and contemplate when they are written down on paper instead of jumbled up in our minds with loads of other information. This section on consequences was very good. I like how they conveyed everything because everything was clear and to the point, which made it easier to comprehend.
Knowing the consequences is extremely important because the severity of each one will have an influence on the one chosen and Hammond, Keeney, and Raiffa have given us a useful way of determining what the consequences are to our alternatives. The fifth element is Tradeoffs. The whole tradeoff process involves getting your number of alternatives down to a reasonable number to choose from. This is done by getting rid of the ones that are dominated by others, which basically means the ones that are not as beneficial are being tossed out of the pool of choices. Once this is done, there are only a handful of alternatives left to decide from. The true tradeoff process now begins because it involves each alternative and its respective consequences. The tradeoff process enables us to adjust our consequences of different alternatives to make them equal to other alternatives for a given objective. This type of method helps to make the last remaining possible alternatives equal so the final decision is easier to make. The method that Hammond, Keeney, and Raiffa touch on is the swap method, which means that when one alternative increases with regards to an objective while another alternative decreases with regards to an objective. I think that this element is important because whenever I am faced with a decision, I am always wondering what I am missing by making the decisions that I do.
One thing that I think they should have done was incorporate the tradeoffs with the alternatives instead of by themselves after the consequences. It seems to me that it would make more sense if they went hand in hand with the alternatives and then lead into the consequences. However, I do think that they have done a good job of emphasizing the importance of having tradeoffs available to use when appropriate. I just think that they are making the process a little longer than it actually needs to be. I agree that formulating the tradeoffs is important, but there is no reason why it has to have its own section and instead be incorporated with the alternatives. The next element is Uncertainty. Uncertainty deals with being in the state of not really knowing if the decision you chose will actually be 'good' decision in the end. The decision that was made could be good and the outcome could be bad or vice versa. There is no way to know what is really going to happen. Hammond, Keeney, and Raiffa have provided us with a risk profile that will help determine the way uncertainty affects an alternative. It basically lists out all of the possible outcomes to a decision and lets you list out the chances of it happening and what the consequences are of it does happen. I honestly feel that this element could be eliminated from the entire decision making scheme. Uncertainty is always going to be present no matter what the case, but I really don't think that it has a lot of influence on how the decision will be made pertaining to the alternatives. Even if it does have an impact on things, I don't think that it has to have a whole section of its own either because it could also be tied in with the discussion of alternatives or consequences. I also don't think that it should come after consequences. If there is going to be a discussion about it, I don't see the sense in having it come after the decision has already been made. If it is going to have an influence on the decision that is being made, I think that it should come before the discussion of the consequences. Now Hammond, Keeney, and Raiffa also go into discussions about uncertainty's role in a decision tree, but I will discuss the decision tree in the next paragraph because I feel it has more of a role with the next element. The seventh element is Risk. Risk is a big factor in the decision making process. I think that this element has more influence on people than anything else because it basically will determine what type of outcome is desired or what someone is willing to give up for the chance of obtaining something else. Risk is going be viewed differently by every single person because not everyone will have the same amount of risk tolerance. This means that one person may or may not be more willing to lose more than another person in the hope of achieving something. Usually the more you are willing to lose, the more you will gain if you choose correctly.
Now going back to why I felt that uncertainty could be eliminated is because I think that risk also encompasses the concept of uncertainty. Hammond, Keeney, and Raiffa have established 3 steps to try and incorporate them, which are
1) Think hard about the relative desirability of the consequences of the alternatives you're considering,
2) Balance the desirability of the consequences with their chances of occurring, and
3) choose the most attractive alternative. I think that the most important part to this element is its decision tree. The decision tree is a very useful table that I was completely unaware of until I read our textbook and Smart Choices. The decision tree pretty much lists out all of the objectives, alternatives, uncertainty, consequences, and some other things that are used to help people make 'good' decisions. The objective is located on the left-hand side with everything else feeding into it. I really like the decision tree because it has a very easy structure to comprehend and it will give you a layout of the different decisions and all of the different possible outcomes. You can also label the costs of each alternative pertaining to what the possible gains and losses are for choosing one decision over another.
Now risk is something that everyone thinks about and should be something that everyone takes an interest in. You never know when anything is going to happen so we always need to be prepared to evaluate all of our choices no matter where we are during our decision-making process. I think that the emphasis that Hammond, Keeney, and Raiffa put on the use of a decision tree is excellent. After experimenting with it, I can honestly say that it helps to lay things out in black and white, which makes the decision making process easier for you to make. There is so much to say about risk and I feel that Hammond, Keeney, and Raiffa have done an excellent job at conveying to us its importance and different options available. The trick is to make sure that everything is that can possibly be known is known because it will be much easier to make a decision with as little amount of uncertainty as possible. Without risk, life would be too easy. The last element that they discuss is linked decisions. Linked decisions are decisions that are made that have a direct effect on the future of other decisions. Hammond, Keeney, and Raiffa state that a decision tied to another decision can take one of two forms. The first one is information decisions and the second one is future decisions. Information decisions are sought out after before the basic decision is made because the information that has been obtained makes us better prepared to make the correct decision. The future decision has to do with making the decisions after the consequences of become known. Whatever the choice is now will dictate what the choices in the future will be. They also feel that the key to having good linked decisions is to get it under control and have them walk to their desks. They actually gives us 6 steps to master analyzed thinking among which are: Understand the basic decision problem, Identify ways to reduce critical under uncertainties, and Identify future decisions linked to the basic definition.
I really feel that the best part of this section is the decision tree because on paper is looks amazingly useful. I think that linked decisions are very important to keep in mind because I honestly don't think that enough people think about what their decision today will do to a decision or situation 5 days from now. Hammond, Keeney, Raiffa do a great job of explaining what everything is and how important it is to start as soon as we can to become 'great' decision makers. Smart Choices was an excellent book to read. I can honestly say that it was a pleasure to read it everyday because there is so many positive things to day. They have given me a lot insight on what it takes to become a successful leader and the importance of being able to make 'good' decisions. Hammond, Keeney, and Raiffa have established the foundation that is necessary to learn how to make 'good' decisions as well as laid the groundwork for much more to come. Everything that they discussed is extremely important in the decision-making process. There are a few elements that could be left out or combined, but for the most part, all of us need to incorporate them into our everyday life in order to become the best decision-makers that we possibly can. There is so much going on everyday that most of us neither have the time or the energy to sit down and go through such a detailed decision-making process. I wish that I could because I definitely see the benefit of having such a process in place, but I just do not feel like I have a lot of time to spare for going through the entire aforementioned problem. The thing I liked the most, which was the decision tree, is probably something that I can't see myself actually sitting down and completing because it is definitely extremely time consuming.
I feel that Hammond, Keeney, and Raiffa have provided us with the necessary tools and procedures to become 'good' decision makers. Through practice and experience, I feel that anyone can achieve a good decision because of the foundation that they have given us: Smart Choices.
Rating:
Summary: Best Simple Explanation of Good Decision-Making Processes
Review: I am a corporate strategy consultant and an author of business books and articles. As a young man, I was taught all of the techniques described in this book in their most complex form. I loved the ideas, and have used them with great success for the last 30 years. Professor Raiffa is someone I admire greatly, as a result. I was delighted to find that this book addresses these complex tools in their simplest possible form, and applies the lessons to everyday living (especially the most important decisions that most people have to make). I immediately bought copies for everyone in my family as a way to help coach them in how to have more effective lives. You should do the same. I also suggest that you use the book as a model the next time that an important decision comes up that your whole family should participate in. This will not only help you develop better choices, but it will greatly improve the communications in your family about the decision. I strongly hope that the authors will write a similarly simple version for business people. I know a few hundred people to whom I would like to give such a book.
Rating: 
Summary: The Jetman
Review: I got to page 75 and couldn't remember what the previous 74 pages said. It was extremely boring and not helpful. Too many bad examples and not enough good ones. Their approach seemed too wordy. I didn't like this book.
Rating:
Summary: Put this one at the top of your reading list
Review: I had the pleasure of reading this book last year as assigned material in a graduate business course taught by Ralph Keeney. My degree is in information systems management and, frankly, I took Managerial Decision Analysis only because I needed 3 elective credits to graduate. In retrospect, however, the course was among the most beneficial to me and Smart Choices was certainly the most relevant book I read in graduate school. I say it was the most relevant because it demonstrates how to define problems and make decisions not simply as a business leader, but as an individual. The PROACT approach is a valuable tool for making formal decisions like "Which career path should I choose?" or "Which software package should I recommend to my client?" But the mentality that the approach engenders is pervasive. You will find yourself unwittingly applying elements of it to questions like "How should I spend time with my kids this weekend?" or "What is the best Valentine's Day gift for my wife?" The greatest benefit to me has been the piece of mind that comes with knowing that I don't just make better decisions -- I am now a better decision maker.
Rating:
Summary: Excellent
Review: I think it would be hard to find a better book on decision making. I agree with some of the suggestions of other reviewers, and hopefully the writers will take them on board in future editions, but overall I think this is an excellent book. It outlines a really clear process for decision making, with numerous examples. It's very easy to read. I would disagree with the reviewer who said it was boring. I found it fascinating. I have also read 'Winning Decisions', which is longer, more sprawling, less well structured. It has some okay content, but this one is the one as far as I'm concerned.
Rating:
Summary: SUPERB BOOK FOR PERSONAL (NOT BUSINESS) DECISION-MAKING
Review: I think this is a great book, but I disagree that it is a primary tool for executives as the last reviewer suggests. The examples deal very well with the personal parts of an executive's life, such as buying a home, allocating family resources, and so forth. Although the concepts in this book could be applied to business situations, I think most readers would have a terrible problem doing so in the absence of business examples. My experience has been that people need to see examples and problems to work through that are closely related to their own situation before they can easily get the message. I hope the authors do decide to write another book on the same subject that is filled with business examples. In the meantime, this one is great for your family and your personal life. Better questions with pertinent business examples can be used to make people consider their assumptions and ordinary thinking habits. I try to always use that approach in my writing and consulting. Otherwise, your progress will "stall" as you are held back by bad thinking habits that keep you from seeing the full potential of the circumstances of your business life. I hope you will read this book, and carry away from it the imporance of improving your thinking.
Rating:
Summary: Best Practices for Personal Decision Making
Review: I was taught all of the techniques described in this book in their most complex form. I loved the ideas when I first learned them, and have used them with great success for the last 30 years. Professor Raiffa is someone I admire greatly, as a result. I was delighted to find that this book addresses these complex tools in their simplest possible form, and applies the lessons to everyday living (especially the most important financial decisions that most people have to make like buying a home). A strength of this book is in the many detailed examples of personal decisions that are used to explain the authors' concepts. I immediately bought copies for everyone in my family as a way to help coach them in how to have more effective lives. You should do the same. I also suggest that you use the book as a model the next time that an important decision comes up that your whole family should participate in, such as whether to take a new job in a different state. This will not only help you develop better choices, but it will greatly improve the communications in your family about the decision, overcoming stalled thinking that could otherwise harm your family. I strongly hope that the authors will write a similarly simple version for business people, that applies these concepts to important business decisions. I know a few hundred people to whom I would like to give such a book.
Rating: 
Summary: Good Info, Poor Presentation
Review: The information presented in the book can be used to make vast improvements in decision making. The problem is that the book is difficult to read because it is pretty boring. The examples used in the book do little to enhance the reading. If you have to read a book on decision making, and can focus on something that's pretty boring, you should give this one a try.
Rating:
Summary: Indeed a practical guide
Review: This book is able to break down the decision making process into logical steps so that one can actually consciously think about it when faced with a decision. Some of the ideas are very simple and fundamental and we probably used them without thinking. What this book succeed in doing was to show how to look at the whole picture and how the ideas fit in. It was a good idea to used the home buying example though the process to illustrate the initial steps. However it would be better to use a consistent example for the last few topics as well. Was thinking that it would be nice to have a neat one page illustrated road map that can be pulled out and pasted in front of the desk.
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