Risk Management

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Decision Quality

  • 1.  Decision Quality

    Posted 28 days ago

    Does anyone in this community have experience with the concept of Decision Quality? This is an intersection that is worth exploring.

    pro tip: you could search and paste in what you've found with appropriate attribution🙂



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    Mitch Winkler P.E.(inactive), M.ASCE
    Houston, TX
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  • 2.  RE: Decision Quality

    Posted 26 days ago

    The concept of decision quality is built around a decision framework focused on larger strategic decisions that firms may decide to make, not the day-to-day decisions. If you're interested, I'd suggest picking up the book, "Decision Quality: Value Creation from Better Business Decisions," it does a good job at laying out the framework. If you want to dive deeper, I would check out the Society of Decision Professionals and the executive education at UT Austin. While the framework is intended for large impact decisions, the metal framework can still be helpful for the smaller decisions. I would recommend anyone interested in the topic to also study cognitive biases and traps.



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    Daniel Axson P.E., M.ASCE
    Senior Director of Digital Transformation
    ACEC National
    Midlothian VA
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  • 3.  RE: Decision Quality

    Posted 25 days ago

    In the PMI Risk SIG I was intrigued by the notion of 'operational risk' used in Banking and Underwriting. Any project-oriented enterprise should integrate large projects into their executive dash board, I believe. Hence, I cannot quite understand the difference between Decision Theory in projects (linked to failure and event trees) and Daniel Axson's more strategic management decision quality. Was that born by market analysis in consumer industry?

    At ETH in Switzerland we once had a wonderful interdisciplinary post-graduate study programme on Risk Management, from earthquake engineering to chemical engineering. Unfortunately it ceased due to decreasing lack of interest among practical engineers...

    Please continue to explain Decision Quality, will you? What is the contents of the lectures at UT Austin, I wonder?



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    J.-Martin Hohberg
    Dr.sc.techn, M.ASCE FED
    Sr. Consultant, IABSE e-Learning Board
    Bremgarten / Berne, Switzerland
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  • 4.  RE: Decision Quality

    Posted 25 days ago
    Edited by Mitchell Winkler 25 days ago

    Thanks Daniel for getting this started and Martin, for your follow up post.

    I learned about Decision Quality in the 1990s and it's one of the key tools I carry in my head and use on a regular basis.  I wrote this introductory article on the topic in 2022.

    I thought it was timely to resurrect the concept in this community as I think it can have a huge impact on risk management .  

    https://www.asce.org/publications-and-news/civil-engineering-source/article/2022/03/22/improve-your-civil-engineering-decision-making-process

    i think there is huge running room for its use in projects for the built environment  I've been giving a seminar to the senior design students at my undergraduate institution for the past five years on the topic. A message to them is that DQ provides a structured approach for them to identify the preferred concept for their design challenges and a structured means to demonstrate the basis of their recommendation to their 'client.'



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    Mitch Winkler P.E.(inactive), M.ASCE
    Houston, TX
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  • 5.  RE: Decision Quality

    Posted 25 days ago

    Here is the link for the classes: https://www.mccombs.utexas.edu/execed/for-individuals/classes/class-schedule/#

    Look for classes led by Dr. Eric Bickel - he generally leads the Decision courses. I took the Leading Strategic Decision Making course about 5 years ago that is more focused on the leadership side of the process. The other courses are more analytical in nature if I recall.



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    Daniel Axson P.E., M.ASCE
    Senior Director of Digital Transformation
    Midlothian VA
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  • 6.  RE: Decision Quality

    Posted 24 days ago

    What insights did you get from the course? What is your view on the relationship between DQ and risk management?



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    Mitch Winkler P.E.(inactive), M.ASCE
    Houston, TX
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  • 7.  RE: Decision Quality

    Posted 24 days ago

    At first glimpse at the Texas study programme you will see that important decisions appear to regard supply chain strategy, certainly involving offshoring decisions, and the like. If you look at Dr. Bickels' LinkedIn profile, he did his doctorate at Stanford (1999) on Engineering Economic Systems -- which could mean Economics in [Industrial] Engineering or Engineering of Economic Systems. 

    The term Engineering has deplorably proliferated to all kinds of optimization involving applied mathematics, such as 'Financial Engineering'. In Europe - for granting the title EUR ING - such study programs are not considered genuine engineering, as little as Operations Research is considered a technical curriculum. 

    Markov chains seem to be a major ingredience of OR, cf. https://en.wikipedia.org/wiki/Markov_decision_process.



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    J.-Martin Hohberg
    Dr.sc.techn, M.ASCE FED
    Sr. Consultant, IABSE e-Learning Board
    Bremgarten / Berne, Switzerland
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  • 8.  RE: Decision Quality

    Posted 24 days ago
    Edited by Daniel Axson 24 days ago

    The course I took revolved around managing the process related to the framework. It included discussions about the framework, as well as techniques for leading discussion among stakeholders and aggregating the input for decision making. The course I was in was not the analytical side of the process. Some of the other students in the course had taken those and looked interesting. 

    I'd say the DQ is part of the risk management function - but the full process can be a hammer, not every decision is a nail. Some decisions are routine. Deciding to take a project is routine, deciding to start a new service line or deciding to go international can be a strategic decision that could demand DQ under the right circumstances. The process and framework can be very analytical. But - understanding the process can be a helpful way of evaluating bias for even the most routine decisions. 

    EDIT: The UT program is influenced by their academic areas of study - which is heavy in supply chain and petroleum. Dr. Bickel's undergrad degree was in engineering, with a minor in economics. There is a history of the Stanford program on their website. 

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    Daniel Axson P.E., M.ASCE
    Senior Director of Digital Transformation
    Midlothian VA
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  • 9.  RE: Decision Quality

    Posted 23 days ago

    Thanks for this. I share your observation that DQ can be a key tool for overcoming cognitive bias. I also see the process as very scalable. 



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    Mitch Winkler P.E.(inactive), M.ASCE
    Houston, TX
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  • 10.  RE: Decision Quality

    Posted 23 days ago

    Dear Daniel,

    as Engineer I must annotate that customer projects are far from 'routine'.

    Most of the times there is always a substantial risk involved, either monitary -- uncovered expenditure to deliver quality in time, including strategic prizing in the tendering phase -- or reputational due to violating subject-matter expectations or because of claims to cover change orders, scope creep, etc. All this should be part of risk management in assessing the business case, at least when the project in question surmounts a certain percentage of the annual turnover.

    A well run engineering or construction company has an escalation process of signing the project contract depending on risk level. And this is why I said earlier that such key projects shall become part of the CEO's dashboard and, if necessary, be controlled by a dedicated steering committee.

    In Project Management I'm often confronted with the fact that a large part of the PM community never had to satisfy external customers; although at least in R&D challenges should be comparable, conferring to e.g. the automotive, ICT or pharmaceutical industry, not to mention defense and NASA.

    Kind regards, Martin

    former PMI Risk / TP / DPC SIGs



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    J.-Martin Hohberg
    Dr.sc.techn, M.ASCE FED
    Sr. Consultant, IABSE e-Learning Board
    Bremgarten / Berne, Switzerland
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  • 11.  RE: Decision Quality

    Posted 23 days ago

    The prompt that reminded me of the connection between risk management and DQ was this linkedin post.

    https://www.linkedin.com/posts/ruthhocker_civilengineering-engineeringexcellence-technicalcommunication-share-7490768914503700480-Ej3m/?utm_source=social_share_send&utm_medium=member_desktop_web&rcm=ACoAAAJVMwABNGK_VxFK10GoZZLT2CccHEN3bGs 

    To your point, Martin, and as echoed in your post, it's essential to have confidence that we are solving the right problem. The very start of the design process is where value writ large (project , reputation, financials, etc.) is created or destroyed. You can never guarantee a decision outcome, but you can ensure that a good decision was made. 



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    Mitch Winkler P.E.(inactive), M.ASCE
    Houston, TX
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  • 12.  RE: Decision Quality

    Posted 23 days ago

    Hi Mitch, I though we are discussing primarily the in-company decision to pursue a project as viable business case or not. At least this is what the management course in Austin TX seems to be about.

    Pointing to Ruth's LinkedIn post, you are widening the perspective to engineering ethics and resposibility to society, which is an entirely different discussion on decision quality. Of course, the cost-benefit analysis is a major step in Preliminary Design when comparing feasible variants in terms of macro-economic opportunities vs. project challenges and associated price tag.

    Cf. this graph from the FIDIC Definition of Services (DOS) Guideline of 2016, referring to value engineering:

    image


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    J.-Martin Hohberg
    Dr.sc.techn, M.ASCE FED
    Sr. Consultant, IABSE e-Learning Board
    Bremgarten / Berne, Switzerland
    ------------------------------