In an increasingly complex world we need more simplicity or more time. The challenge is time is scarce and inelastic. And according to some recent research by Boston Consulting Group managers can spend 40% of their time writing reports and 30% in meetings. The implication is they only have, at best, 30% of their time to actually manage.
So speed and high quality decision-making are essential both in business and in non-profits. The question is how do you do that?
The answer may lie in a new approach called simple heuristics.
We all know the old adage – ‘look before you leap.’ And we equally know the famous converse ‘paralysis by analysis.’ So how do you strike a balance between too much consideration- when you can probably never get enough time and data for a good decision- and reckless gung ho first mover advantage which leads to ruin or at best risk? One approach is to find some simple yet profound rules and apply them systematically. But you need not just any rules – you need a special kind of rules, simple heuristics.
The idea of simple heuristics was developed by Gerd Gigerenzer, in his 1999 book Simple Heuristics That Make Us Smart. Gigerenzer, a psychologist by training, is head of the Max Planck Institute Centre for Adaptive Behaviour and Cognition in Berlin.
His thesis is that he key driver these days is indeed time. We need to make decisions fast but avoid simply guessing. He developed his model of simple rules to guide decision-making across a range of industries. As a non-profit example he recently developed a set of heuristic questions to help US doctors assess patients with potentially serious heart conditions. Many of these patients arrived at the hospital with a range of symptoms. He developed a more efficient process to classify patients as potentially high risk, and therefore needing access to intensive care quickly.
Gigerenzer was aware he had to strike a careful balance. Doctors want to make sure they give a patient enough time and attention to assess them thoroughly. But they don’t want to give so much time that they allow someone else to die! Also if they always err on the side of caution they would fill intensive-care units with not very ill patients. More data or more high tech kit didn’t seem to solve the problem of who to admit to the intensive care units. It always came down to a judgement. The challenge was to develop a ‘triage’ system that produced simple and positive decisions that then stood the test of time clinically.
Gigerenzer and his team dug spoke to hundreds of physicians to come up with their answer. As a result a series of three simple questions has replaced complex, data-led assessment for admitting patients. Anyone admitted with heart problems is assessed according to three questions.
If the answer to all three questions is ‘yes’ the patient is automatically sent to intensive care. If the answer is ‘no’ they seek an alternative. This model is now used in emergency rooms throughout the U.S.
Experience of the heuristic approach demonstrates it is more accurate – and so more life saving – than complex technological interventions. The key learning is that sometimes you just have to ignore a great deal of the peripheral data and focus on the key issues.
The simplicity of the model doesn’t mean it’s simplistic. In fact shaping a complex and high-risk process to its key parts, producing an end result that is streamlined and effective needs numerous iterations. But it’s well worthwhile especially when time and complexity are in conflict.
The lessons for not for profits generally? What processes do you need to make simpler? What are the key rules you need to replace?