Friday, 10 February 2012

Choosing between "good enough" and " optimum"

When I was Housing Commissioner of Uttar Pradesh (2001-2004), a quote from Lord Chesterfield, a British Statesman(1694-1773) caught my fancy:"Whatever is worth doing at all, is worth doing well"I not only liked it , I became convinced of it intuitively.I got its several copies made, and circulated these to all the employees of UP Housing Board, numbering around 5000 in .
But recently , I came across  a statement  which went  a different way :"There are things that are worth doing but worth doing poorly.We do these things moderately but not superbly.We decide where we excel and where we satisfice".I was  vaguely familiar with the phrase "satisficing' from Herbert A. Simon's "Administrative Behaviour" but I could see the two different approaches to decision making in life .This was further confirmed with  a quote by  Steven Sample from  his book "The Contrarian's Guide to Leadership " as follows:'Anything worth doing at all is worth doing poorly.It may be worth more if it is done well, but it's worth something if it's done poorly"
In your decision making process,do you settle for good enough  in everything , or do you seek the best , the optimum only?
                                                     Herbert A. Simon introduced satisficing in "Models of Man" in 1957 for this behaviour or approach of accepting good enough.He  got Nobel Prize in 1978 for economics .He coined this word satisfice out of satisfy and suffice, and it meant good enough to be acceptable.Satisficing applies to organizations as well as individuals. We satisfice as administrators or managers as well as shoppers on a mall .Simon called it The Theory of Bounded Rationality. He went on to say: “Because he treats the world as rather empty and ignores the interrelatedness of all things (so stupefying to thought and action), administrative man can make decisions with relatively simple rules of thumb that do not make impossible demands upon his capacity for thought.”
                                               Satisficing is a decision making process which enables us to decide a course of action on the basis of what is acceptable to us and satisfies at least our minimum requirements.In this process , we settle on the first alternative that meets our minimum requirements.  For example, when  shopping , we decide to purchase something that we find acceptable, although that may not necessarily be optimal. While  optimising , we set high standards and seek the best ,maximise our  benefit from a particular course of action .In optimising , there is a cost of decision making process.It poses four types of difficulties:
1.We ourselves do not know what is the best choice .The selection of what is the best, is difficult  and subjective.
2.We do not know the relevant probabilities of outcomes.
3.We do not know the precise way of evaluating all outcomes.  We do not get access to all the information required
4.We  tend to give more weight to recent happenings.
Many times , it is not worth it to examine every single option and optimise.As a result  , we prefer to seek  satisficing over optimising.An opimiser throws away real world considerations such as deadlines and implementation.There may be paralysis by analysis.

But there is a downside of satisficing.
1.Satisficing makes us less efficient , less willing and slow to try new tools, new technology and new ways.We throw away  innovation, leaving no room for progress.We choose to stay in our comfort zone and make no effort to stretch of walk an extra mile.There is , I believe, a tendency in all of us to satisfice.This is what Herbert A. Simon called the bounded rationality.
For example , we can manage our documents , notes by using simple software tools that can replace the existing cumbersome solutions .In stead of visiting site after site, of blogs that we choose to follow, we can use RSS feeds.But we do not use RSS feeds out of mental laziness, or our tendency to satisfice.
2.Satisficing has misleading effect on the statistical methods /surveys related to research , especially market research.While filling questionnaires, respondents choose satisficing answers , rather than optimum answers.
3.Satisficing can  encourage us to live beyond our means .Whether it is in using credit cards , buying life insurance policies or car insurance , satisficing can make us careless .It can prompt us to live without a budget.
4.We satisfice all day long without thinking about it.We are in rush, and don't really know how to optimise.In such a scenario, optimising becomes a luxury.

What is the way out ?An important question to ask ourselves is what should be optimised and what should be satisficed?Do we need to maximise/optimise  profit?A close scrutiny will reveal that profit need not be a goal to be maximized .But an organisation needs  to have a minimum profit before it can  realise other goals .In this way , profit becomes a constraint .There needs to be a clarity of our goals before we  decide what should be optimised and what should be satisficed.
                                Satisficing in economic or administrative decisions is easier to understand , accept  and adopt but in decisions involving moral issues,it poses problems.An action is not morally right if it is "good enough".It is morally  right only if it is perfectly optimal  and maximizes the good (aggregate human welfare).However , we do have satisficing consequentialists who advocate "good enough" approach even in moral issues . I do not subscribe to this view. In moral matters , we must call for optimisation and set out to do what is morally right than what is acceptable or convenient .There is very little scope of  compromise on moral issues .
In my views, at the beginning , we should push for optimisation in most of the decisions.We should set high standards in what ever we decide to do.We should get out of our comfort zones and force ourselves to explore new ways.Then we may decide to stop  if the matter in hand does not involve important moral choices.But we must not compromise easily .This is easier said than done .