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Top executives understand that decisions made with more and better information lead to greater True Shareholder Value. However, full analysis often hinders agile decision-making. Decision-makers will find this scenario familiar. Faced with a critical series of choices, a decision-maker wants an analysis of the available information to determine which strategy provides the greatest True Shareholder Value. For instance, product demand may be expected to increase, and the decision-maker wants a strategy for expanding manufacturing capacity. Many pieces of information may impact this strategy, such as past sales data, knowledge workers’ beliefs about future demand, information about supply chain dynamics, and the uncertainty of future costs. Analysts or consultants are tasked with creating an analysis to determine the company’s best strategy. Two months later, the analysis is delivered in the form of a complex spreadsheet. After a series of meetings involving the analysts, decision-maker, and other stakeholders, some rudimentary understanding of the analysis is reached, which helps the decision-maker imagine a few new possible actions to include in the strategy. The decision-maker discovers that the analysis’ sales projections were based only on past sales data, ignoring key market research the company had gathered, and that over the last two months, some of the information used in the analysis had changed. Armed with new and updated information, the analysts begin work again, but several weeks into the reanalysis, product demand exceeds manufacturing capacity. Shareholder value is being lost every minute, a result of “analysis paralysis”. Top executives understand that speed and agility lead to greater True Shareholder Value. However, rapid decisions often ignore relevant information. From this experience, the decision-maker realizes that detailed analyses will often require more time than is practical. So now, knowledge workers are asked to only estimate the most high-level information relating to decisions, like expected future revenues and costs. With just this rapid analysis, the decision-maker attempts to determine the strategy that maximizes True Shareholder Value. Suppose that as the expansion strategy proceeds, it is discovered that a key component supplier is already at their own capacity. The supply chain manager could have supplied this possibility, but the fast decision ignored this information, again leading to loss in True Shareholder Value. Top executives strive to create True Shareholder Value through rapid decisions made with any type of relevant information. Speed and information both contribute to True Shareholder Value. Traditionally, managers have been faced with a tradeoff: either act quickly but ignore key information, or use more information at the expense of time. This is no longer acceptable, as decision-makers are now beginning to expect both speed and information. Information from IT, knowledge workers, and others needs to be gathered quickly and easily. Detailed strategic analyses need to be completed in days rather than in weeks or months.
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