Decision-Making – Page 2 – understand-culture

Limitless Resources

Alexis de Tocqueville (1805-1859) – French political thinker and historian best known for his Democracy in America – wrote: “The country appears to stretch on forever and is of limitless resources. But, no matter how fast it grows, it will remain surrounded by resources it cannot possibly exhaust.”

Energy: The United States has more coal reserves than any other country in the world and represent one-quarter of the world’s total coal supply. The U.S. has 272 billion tons of coal reserves and uses about 1.1 billion tons of coal per year. At this rate, America’s 272 billion tons of coal reserves would last nearly 250 years.

According to the 2012 article “American Oil Growing Most Since First Well Signals Independence“ by Asjylyn Loder on bloomberg.com domestic output of oil grew by a record 766,000 barrels a day to the highest level in 15 years, government data shows, putting the nation on pace to surpass Saudi Arabia as the world’s largest producer by 2020.

Net petroleum imports have fallen by more than 38 percent since the 2005 peak, and now account for 41 percent of demand, down from 60 percent seven years ago, moving the United States closer to energy independence than it has been for decades.

Key natural resources: One-third of U.S. land is covered by forests (302 million hectares), making forestland the number one type of land use in the United States. One-fifth of U.S. land is timberland (204 million hectares), which is land capable of producing 1.38 cubic meters per hectare of industrial wood annually. 71 percent of all timberland in the U.S. is privately owned, while 29 percent is publicly owned.

Land: The United States has a land area of 3.8 million miles² (9.8 million km²) compared to 9.7 million km² in China, 0.36 million km² in Germany and 0.38 million km² in Japan.

Population density: United States population density per square mile is 84, compared to 365 for China, 609 for Germany, and 836 for Japan.

Avoid philosophical discussion

Americans do not engage in a discussion about the essence of a decision to be made. If a discussion does takes place about the decision in and of itself, however, it is strictly for the purpose of defining who and/or what is to be served by making a good decision.

Americans invest less time on identifying how a particular decision fits into the broader picture. Their approach to all decisions is primarily motived by pragmatism. Decisions lead to actions, which in turn lead to further decisions to be made. Americans avoid getting weighted down in what they view as over-analysis. Forward movement is of priority.

Entangling Alliances

As a nation-state, in their international relations, Americans warn against becoming involved in complexity. Thomas Paine (1737-1809) – an English-American political theorist-activist, author, and revolutionary – instilled non-interventionist ideas into the politics of the American colonies.

His work Common Sense (1776) argued in favor of avoiding alliances with foreign powers and influenced the Second Continental Congress to avoid forming an alliance with France.

George Washington’s farewell address restated Paine’s maxim: “The great rule of conduct for us, in regard to foreign nations, is in extending our commercial relations, to have with them as little political connection as possible. Europe has a set of primary interests, which to us have none, or a very remote relation.

Hence she must be engaged in frequent controversies the causes of which are essentially foreign to our concerns. Hence, therefore, it must be unwise in us to implicate ourselves, by artificial ties, in the ordinary vicissitudes of her politics, or the ordinary combinations and collisions of her friendships or enmities.“

Thomas Jefferson extended Paine’s ideas in his inaugural address on March 4, 1801: “peace, commerce, and honest friendship with all nations, entangling alliances with none.”

In 1823, President James Monroe articulated what would become the Monroe Doctrine: “In the wars of the European powers, in matters relating to themselves, we have never taken part, nor does it comport with our policy, so to do. It is only when our rights are invaded, or seriously menaced that we resent injuries, or make preparations for our defense.“

Ecological Awareness

The Germans think ecologically. They not only draw on their resources sparingly, they also try to limit the negative effects of that use. Although Germany has a high population density, it has managed to declare almost 3% of its land as publicly-protected national parks, far above the average within the EU.

Many laws have been passed to protect the environment, including strict recycling laws for bottles, cans and other packaging material. Those who can afford it choose to buy organic food.

The Germans find more and more ways to save electricity and water, both of which are expensive. As of October 2012 only energy-saving lightbulbs can be sold. The stores offer only energy-saving lamps and lighting fixtures.

German awareness of the environment gave rise to the Green Party in the 1970s, which has developed into a major political force in Germany, and recently was the junior partner in the government with the Social Democrats. Ecological concerns have become common in all German political parties.

Aggregate

The more resources – material, budget, time, personnel – an organization has at its disposal, the more likely it will draw on them in order to solve a problem, take advantage of an opportunity, accomplish a task. Especially if the organization needs to move quickly. And conversely, the less likely it will develop approaches which conserve those resources. Americans are not known for doing more with less. Not yet.

Aggregate: formed by the collection of units or particles into a body, mass, or amount; clustered in a dense mass; composed of mineral crystals of one or more kinds or of mineral rock fragments; taking all units as a whole. From Middle English aggregat, from Latin aggregare to add to, from ad- + greg-, grex flock.

Americans aggregate. When the U.S. goes to war it aggregates overwhelming force. The current debate is how to move away from this tradition. American websites aggregate content. When start-up companies “go public” – initial public offering – financial institutions aggregate investors.

External Factors

Decisions are not made in a vacuum. American decision-making allows itself to be influenced by external factors. External customers, company-internal partners, suppliers, changing management priorities, budgets and manpower all can have impact on individual decisions. American decision making aims to be market-driven.

Market-driven in the U.S. means making decisions based on the market‘s rhythm. If necessary, Americans will skip over steps in their decision making approach.

To turn on a dime: To take a very tight turn, used especially for a vehicle; to change direction quickly. A dime is the smallest in size of American coins.

Experience: To encounter or undergo (an event or occurrence); to feel (an emotion); practical contact with and observation of facts or events; the knowledge or skill acquired by such means over a period of time, especially that gained in a particular profession by someone at work; an event or occurrence that leaves an impression on someone (a learning experience).

Down and dirty: Americans are not perfectionists. The goal is seldom the optimal decision, but instead the most effective decision under the given circumstances. Often timely decisions, even if suboptimal, are the best decisions. They can be corrected.

People Driven

Americans are skeptical of business processes that attempt to replace human judgment. They believe that decision-making is inherently human. Drawing on personal and professional experience, intuition and judgment, a person or a group of persons makes the decision. Processes have neither experience, nor intuition nor judgment.

Analysis defines the situation, the options, their respective risks and benefits. Experience informs about how the situation could/should be dealt with. And intuition influences the decision.

Decision: A conclusion or resolution reached after consideration; the action or process of deciding something or of resolving a question; a formal judgment; the ability or tendency to make decisions quickly; decisiveness. From Latin decidere “determine”.

Analysis: Detailed examination of the elements or structure of something, typically as a basis for discussion or interpretation; the process of separating something into its constituent elements; the identification and measurement of the chemical constituents of a substance or specimen.

American Entrepreneurs

Scottish-American Andrew Carnegie led the expansion of the American steel industry in the late 19th century with the Carnegie Steel Company. Carnegie established public libraries throughout the United States, the United Kingdom, and other English-speaking counties.

He funded approximately 3,000 libraries in 47 states in the United States, Canada, the United Kingdom, Ireland, Australia, New Zealand, the West Indies and Fiji. He donated 50,000 British pounds to help establish the University of Birmingham in 1899.

British- and Irish-American Henry Ford founded the Ford Motor Company and was sponsor of the development of the assembly line technique of mass production. His development of the assembly line allowed many middle class Americans to afford and buy automobiles. Ford left most of his wealth to the Ford Foundation.

William “Bill” Gates is the former chief executive and current chairman of Microsoft, the world’s largest personal-computer software company. He co-founded Microsoft with colleague, Paul Allen. He is one of the best-known entrepreneurs of the personal computer revolution. After studying the work of Andrew Carnegie and John D. Rockefeller, Gates sold some of his Microsoft stock in 1994 to create the William H. Gates Foundation.

In 2000, Gates and his wife combined three family foundations and founded the Bill & Melinda Gates Foundation, which is currently the largest transparently operated charitable foundation in the world.

The American culture admires risk-takers. They are considered to be courageous, ingenious, hard-working, forward thinking. The American experience is one of trial and error. It begins with how parents raise their children to try things, to attempt more than before, to experiment. A mistake is only one when one doesn‘t learn from it. Trial and error is moving forward, is getting better at something. It is synonymous with learning by doing.

Immigrant experience

All Americans are descendants of immigrants. And the immigrant experience begins with risk-taking. All immigrants risk, to one degree or another, what they own and know. Taking that one great risk, that leap of faith, makes small most later decisions in life. Immigrants are, or have become, by their very nature risk-takers. Americans are risk-takers.

The American economic system encourages entrepreneurship. It pays in the U.S. to establish your own business. Businesses owners who enjoy high success do very well financially. Owners who enjoy medium success do well financially. Those, however, who enjoy low success do very poorly financially. “No risk, no reward.”

Small businesses – firms with fewer than 500 employees – drive the American economy by providing jobs for over half of the nation’s private sector workforce. Small businesses are job creators, representing 99.7% of all firms. They make up the following: 64% of net new private-sector jobs, 49.2% of private-sector employment, 46% of private-sector output, 43% of high-tech employment, 98% of firms exporting goods and 33% of exporting value.

Small businesses create more than half of the private non-farm gross domestic product and create 60-80% of net new jobs. 19.6 million Americans work for companies employing fewer than 20 workers, 18.4 million work for firms employing between 20 and 99 workers, and 14.6 million work for firms with 100 to 499 workers. 47.7 million Americans work for firms with 500 or more employees.

According to the Bureau of Labor Statistics small firms accounted for 64% of the net new jobs created or 11.8 million of the 18.5 million net new jobs between 1993 and 2011. Since the latest recession, from mid-2009 to 2011, small firms, led by the larger ones in the category (20-499) employees, accounted for 67% of the net new jobs.

WBS

WBS stands for work breakdown structure. Wikipedia defines it as: „A hierarchical and incremental decomposition of the project into phases, deliverables and work packages. It is a tree structure, which shows a subdivision of effort required to achieve an objective; for example a program, project, and contract.

In a project, the WBS is developed by starting with the end objective and successively subdividing it into manageable components in terms of size, duration, and responsibility (e.g., systems, subsystems, components, tasks, subtasks, and work packages) which include all steps necessary to achieve the objective.“

Wikipedia goes on to claim that WBS was developed by the United States Department of Defense and was introduced by the U.S. Navy in 1957 to support the development of the Polaris missile program.

Breaking down complexity into its component parts in order to focus on what is truly critical is hardly a development of any human organization of the 20th Century. Surely it is has been fundamental to human thinking for quite some time.