Optimisation Vs Perfection

There is always a trade-off associated between achieving 2 associated things. So is it in case of achieving Optimisation and Perfection at the same time.

Let us look at it from the managers perspective.

Managers need to make decisions day in and day out. Some decisions are very critical and some are not so. The criticality depends upon the impact of the outcome of the decision. So it the decision has a high bearing impact on the organisation it is a critical decision. Otherwise it is not a critical decision.

So needless to say that we have to trade-off in favour of perfection against optimisation (in terms of efficiency and productivity - after taking into account the time taken to arrive at the decision) for highly critical decision making. Hence for day to day decisions (low impact decisions) we should strive to be more optimum rather perfecting it.

This is nothing but a logical conclusion of the Pareto's 80-20 rule. The principle if applied to the decision making criteria would spell out that 20% of the decisions have upto 80% of the impact on the results (which means that they are critical) while the remaining 80% of the decisions have upto 20% of the impact on the results. So it is common sense to spend more time on the critical decisions vis-a-vis on other decisions.

As a manager spends more and more time in taking a decision, in all likelyhood he is moving towards perfecting the decision. We we speak about optimising in this context it means that a lot of decisions have to be taken in a lot of operating constraints. One constraint might be time. In the time context, combining the above two concepts managers would most likely spend only a limited amount of time on non-critical activities so that they can get the best but once the time at hand is exhausted they would simply move on to do other tasks as those activities even if left non-perfected would not have a much impact. The opposite holds true for the critical activities. It is not the constraint which determines the effort to be put in but the sheer magnitude of impact of the decision which determines the effort and subsequently the deadline (constraint).

But in most settings managers have to take a whole lot of decisions and most of them are of low impact and very few are of high impact. Hence managers in my opinion need to follow more of optimisation rather than perfection.

PS:
This content is taken from a co-blogger Anil Daga, Anil is a pass-out of the Prestigious Great Lakes Chennai, prior to which had a Career in Citigroup (IB division).