I recently attended Llamasoft SummerCon 2016, annual conference for the well-established supply network design & optimization player: Llamasoft. Garry Kasparov was one of the keynote speakers. For the chess aficionados among us, this was a once-in-a-lifetime opportunity to interact with the legend and get a picture taken with him.
Garry discussed how as he became the youngest ever chess champion at the age of twenty-two, people routinely hounded him to understand the secret behind this unprecedented success.How did come up with a strategy to defeat veteran grandmasters? How did he plan and replan rapidly in the face of a changing battle competitive landscape, how did he decide on the best move to execute next when faced with multiple options with unclear line of sight in terms of opponent's counter move? Did he have supernatural insight: how many moves ahead could he see to visualize a checkmate on a cluttered board? What went on in his mind during a tense game in the face of missteps? In short, what were the strategic design, tactical planning, and operational execution related decision making processes that led to this extraordinary success.
You will agree we are all looking for similar answers in this increasingly complex, dynamic, and competitive world, moving under time pressure, knowing the risks a single bad move could bring, balancing facts and instinct in the fog of war, which is how business runs in the global marketplace today. If you need insights into your own development as a decision-maker and ideas on how to encourage future growth, then read on.
How do you decide when you are at a fork in the road knowing you must move forward and that you will not be able to backtrack if you choose badly? We all agree that visibility that a map provides is key to understanding the right course of action, still few travel inward to see themselves clearly and fully to understand their own mental map. Self-investigate when you have a quiet moment. Evaluate your decision making style and how well you have fulfilled your potential to make better decisions. Challenge yourself to learn how to make significantly better decisions, your customers and shareholders demand nothing less. Practical, not philosophical, introspection is the ask of you. What's going on inside your head? Look deep into who you are currently and what you are capable of. The comfort zone of status quo slays all giants, move out. As we rush to explore the world outside, there is a greater need to explore our own boundaries as professionals, which are mere lines in the sand, not walls, once you venture outside.
A personalized map is essential in this journey. No tips & tricks to making better decisions consistently can apply to all, you must understand your own mind, your thought processes and emotions that go into making decisions you make. Life is similar to a giant game of chess. Anyone can learn the rules regarding legal movements of the chess pieces in no time, but it's our capability to identify patterns and see clearly on what to do next through the clutter, that distinguishes winners from pawn-pushers. Random movement is not progress, you may have heard about the acronym: RAM - Random Acts of Marketing, they rarely help your branding. Or an acronym in the sales world: LAZY - Lots of Activity with Zero Yield. Good players in life and chess minimize wasted moves, see white spaces instead of current players, and act decisively and lightening fast on the insight. Some call it aggression. Ask Kasparov. He used aggression in his young age as it was the only thing he knew. He uses it now as that yields a winning advantage in most situations.
The quest to understand and industrialize a genius mind continues. Advanced analytics and data science are trying to come at insight-generation business much like IBM Deep Blue came at Kasparov. As Kasparov will tell you, the best insights & decisions are not an exclusive territory of just machines or humans. The unbeatable combination is when aggressive decision-savvy humans leverage tailored machine intelligence for pattern recognition and insights from the oceans of data we have today.
Formula for superior decision making is having access to a large library of patterns and ability to deploy strategies aggressively in the context of patterns, whether you rely on the machines just for data or for insights. Experience, knowledge, and talent all need to come together, and all can be developed with hard work to generate a sharp intuition, which is the weapon of choice for a legendary player like Kasparov in tense games. This influence of individual psychology and emotional make-up expresses itself as 'style' in a spectacularly successful player, business or otherwise. Remember Jobs?
How do you start? Analyze the key decisions you have made in life and how you arrived at those decisions. Did you understand and analyze all your options fully? Did you make the decision after a good night's sleep or in the moment when put on spot? Did you seek advice and educated yourself beforehand or learned by making bad decisions? Self-investigation is key to learning how to make better decisions going forward. Your style is largely fixed, you cannot pick and choose a radically new one overnight. You, however, can develop your own decision making process. Look inside and ask: what kind of decisions do I tend to avoid making and why? Is there a pattern to the good decisions I have made? How about all the decisions you wish you could undo? Decision making excellence cannot be taught, but in can be self-developed through insights into the self.
Become conscious of your decision making processes, stick to decision making practices that work for you, and over time, your intuitive decision making performance will improve. You need to force yourself into an unnatural level of self-awareness for a while to be able to decide effortlessly and correctly with a quick glance at facts and then letting your intuition take over - a trait that all organizations are looking for in their executives. We all have good and bad decision making patterns that have now hardened, self awareness is key to breaking down the bad walls and building on top of the good ones in our mind palace. Sherlock Holmes fans will get the reference to the mind palace. Do read through the end of this blog for my recommendations on how to make better decisions.
At GitaCloud, we enable a step change in your decision making capabilities. We do this by bringing prescriptive analytics and business performance management solutions to find optimal answers to the most complex problems. In today's competitive landscape, business executives must redefine the objectives of Sales & Operations Planning to maximize the value generation for customers and shareholders, while making great decisions to balance strategic objectives and tactical risk.
The decisions needing to be modeled are strategic objectives of the organization, policies associated with supply chain (service level, inventory form/function throughout supply chain, equipment utilization, strategic sourcing), and financial costs associated with the end-to-end supply chain (activity based costs, average selling prices, etc.). Resulting insights can range across: trade promotions, demand priorities, stocking policies, profitability analysis, and stochastic risk analysis. We enable global optimization of the end-to-end supply chain, help you model uncertainty (how best decisions change if business environment changes; think BREXIT), give you insights into business constraints that are keeping you from achieving your goals and monetary value of releasing them.
Specifically, we can help you:
- Optimize Demand: which customers, products, channels are the most/least profitable on a forward looking basis, which demand should we proactively drive, with which products/channels/customers, using which methods (promotions, advertising, incentives)?
- Optimize Supply: what supply response meets demand most efficiently and maximizes overall value, pre-build vs. overtime what-ifs, asset utilization vs. inventory risk, and industry specific requirements like complex blending?
- Optimize Customer Service: how do we structure customer contract terms to maximize value, ideal inventory model by customer segment, understand profit impact of last-minute promotions?
- Optimize Finance: what plan optimizes profitability, cash flow, and ROIC? most significant risks and best responses to mitigate them? how to balance working capital, taxes, currency, and intercompany transfers to maximize net income or Return on Equity or any other financial objective?
- Optimize Business Strategy: how do we optimize product portfolio, impact of sustainability targets on commercial, operations, and financial performance, is our network sub-optimal and how to allocate investments, impact of decisions throughout the value chain, options to respond to shifting competitive scenarios
We are in the business of helping you make significantly better decisions leading to a step change in shareholders' returns. Good enough is not good enough any more, is is in fact inexcusable. Invest the time to understand how S&OP solutions have evolved to true Integrated Business Planning solutions that combine supply chain optimization with full financial forecasts (balance sheet, P&L, cash flow) and the ability to solve supply chains optimally for financial objective functions. We break the walls between S&OP/SCM and FP&A functions within the enterprise and bring operations, commercials, and finance teams in a holistic planning process.
I highly recommend you read the book Garry wrote: How Life Imitates Chess, to gain fresh insights on decision making processes. For those who are at a fork in the road, need to make a life changing decision, know that these moments and the decisions you make will define your lives irreversibly. Live for these moments as they help you understand who you really are and what truly matters to you. Secret is to pursue these moments with confidence and preparation instead of fear and procrastination. Know and develop your own personal decision-making blueprint, so you have the confidence to trust your instinct after all the strategy, preparation, and analysis is done. This is the art of thriving, not surviving. Garry Kasparov can help. So can the team at GitaCloud.
Ashutosh is the Founder & CEO of GitaCloud, a company on a mission to improve decision making in medium to large enterprises. You can reach him at ashutosh@GitaCloud.com. Hope you enjoyed this blog, feel free to reach out and provide feedback. We learn continuously through interactions and would love to hear your thoughts and ideas on the topic.