Money and Finance
- Tren Griffin On Mental Models And Investing...
From Charlie Munger: The Complete Investor (which according to Amazon, is now being shipped for end-of-week deliveries): No one can know everything, but you can work to understand the big important models in each discipline at a basic level so they...
- Herbert Simon Quote On The Value Of Mental Models
Via Farnam Street (Thanks for sharing!):“One can train a man so that he has at his disposal a list or repertoire of the possible actions that could be taken under the circumstances…A person who is new at the game does not have immediately at his disposal...
- Smart People, Dumb Decisions - By Michael Mauboussin
Originally found via Simoleon Sense. If you ask people to offer adjectives that they associate with good decision makers, words like “intelligent” and “smart” are generally at the top of the list. Yet, history contains plenty of examples of smart...
- Emotion Can Make You A Bad Investor
The brain processes expectation in a much more intense way than it processes the actual experience. So, the hope of making money often feels better than actually making money does, and the fear of losing money often feels worse than actually losing money....
- A Fine Line Between Patience And Laziness
"Perhaps the strongest feature in his character was prudence, never acting until every circumstance, every consideration was maturely weighed; refraining if he saw a doubt, but, when once decided, going through with his purpose, whatever obstacles opposed."...
Money and Finance
The Structure of “Unstructured” Decision Processes - 1976 Paper
How do organisations go about making “unstructured,” “strategic” decisions? Researchers of administrative processes have paid little attention to such decisions, preferring instead to concentrate on routine operating decisions, those more accessible to precise description and quantitative analysis. As a result, the normative models of management science have had a significant influence on the routine work of the lower and middle levels of organisations and almost no influence on the higher levels. But it is at the top levels of organisations where better decision-making methods are most needed; excessive attention by management scientists to operating decisions may well cause organisations to pursue inappropriate courses of action more efficiently.
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Although there is a body of normative literature on techniques for strategic decision making, for example, strategy-planning, models of the firm, cost-benefit analysis, the evidence from empirical studies of their application indicates that all too often these techniques have made little real difference in the decisional behaviour of organisations (Grinyer and Norburn 1975, Hall 1973, Whitehead 1968). These techniques have been unable to cope with the complexity of the processes found at the strategy level, about which little is known.
Although there is a body of normative literature on techniques for strategic decision making, for example, strategy-planning, models of the firm, cost-benefit analysis, the evidence from empirical studies of their application indicates that all too often these techniques have made little real difference in the decisional behaviour of organisations (Grinyer and Norburn 1975, Hall 1973, Whitehead 1968). These techniques have been unable to cope with the complexity of the processes found at the strategy level, about which little is known.
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This paper defines a decision as a specific commitment to action (usually a commitment of resources) and a decision process as a set of actions and dynamic factors that begins with the identification of a stimulus for action and ends with the specific commitment to action. Unstructured refers to decision processes that have not been encountered in quite the same form and for which no predetermined and explicit set of ordered responses exists in the organisation. And strategic simply means important, in terms of the actions taken, the resources committed or the precedents set. This paper uses empirical research to suggest a basic framework that describes unstructured, strategic decision processes. The suggested framework embodies the results of our own study of 25 such decision processes, as well as evidence from published empirical studies.
This paper defines a decision as a specific commitment to action (usually a commitment of resources) and a decision process as a set of actions and dynamic factors that begins with the identification of a stimulus for action and ends with the specific commitment to action. Unstructured refers to decision processes that have not been encountered in quite the same form and for which no predetermined and explicit set of ordered responses exists in the organisation. And strategic simply means important, in terms of the actions taken, the resources committed or the precedents set. This paper uses empirical research to suggest a basic framework that describes unstructured, strategic decision processes. The suggested framework embodies the results of our own study of 25 such decision processes, as well as evidence from published empirical studies.
- Tren Griffin On Mental Models And Investing...
From Charlie Munger: The Complete Investor (which according to Amazon, is now being shipped for end-of-week deliveries): No one can know everything, but you can work to understand the big important models in each discipline at a basic level so they...
- Herbert Simon Quote On The Value Of Mental Models
Via Farnam Street (Thanks for sharing!):“One can train a man so that he has at his disposal a list or repertoire of the possible actions that could be taken under the circumstances…A person who is new at the game does not have immediately at his disposal...
- Smart People, Dumb Decisions - By Michael Mauboussin
Originally found via Simoleon Sense. If you ask people to offer adjectives that they associate with good decision makers, words like “intelligent” and “smart” are generally at the top of the list. Yet, history contains plenty of examples of smart...
- Emotion Can Make You A Bad Investor
The brain processes expectation in a much more intense way than it processes the actual experience. So, the hope of making money often feels better than actually making money does, and the fear of losing money often feels worse than actually losing money....
- A Fine Line Between Patience And Laziness
"Perhaps the strongest feature in his character was prudence, never acting until every circumstance, every consideration was maturely weighed; refraining if he saw a doubt, but, when once decided, going through with his purpose, whatever obstacles opposed."...