Had Herbert Simon been hired by Indian government as an advisor for improving the decision-making in the government,I am very sure he would have been shocked to see his research on ‘decision-making’ could barely make its presence felt in Indian public sector.Herbert Simon is famous for his contribution to the field of decision-making especially for his concepts of ‘Bounded rationality’ and ‘Satisficing’. In simple words,Herbert Simon admitted that a decision-maker may not be completely rational while making a decision.However, he still can be rational in a bounded manner and satisfy himself with the most optimal choice.In a way , Simon gave one of the most practical administrative theories which accepts the limits of rationality and at the same time, gives the space to rationality which it deserves in the process of decision-making.
In his pursuit to improve decision-making,Simon also designed a framework to improve the process of decision-making.In the first stage, the job of the decision-maker is to collect as much data as possible that can help in evaluating the proposal in an empirical way.This is the weakest point of public sector in India.Data sleeps in files which are sometimes kept cozily in compactors and sometimes , they are just put in corners for some rodents to feed on them.This in deep contrast to private sector who have already done a lot of homework in this area.Most of the private organizations have ERP(Enterprise Resource Planning) systems in place and monitor each transaction closely.They have well established data processing centers from where the data can be retrieved as and when required.Thus, the data in private sector is live and active where as in public sector it is lazying around.
Second stage is to analyze various options to deal with the situations and try to list out the pros and cons associated with that decision.This stage is prevalent both in public sector and private sector .In both the places,managers try hard to find alternatives and use out of box thinking to provide solution to the problem.In this case, one has to appreciate that public administrators,unlike popular perception, do find a lot of innovative solutions in order to tackle a problem but they have no way to test whether their solution will work out or not.Thus, it becomes a matter of chance whether the solution will work or not.This is mainly because the first stage provides the base for second stage and if the first remains weak , the second will not be able to deliver much and the third stage i.e. final choice stage will remain largely intuitive and unscientific.A classic example of this is dynamic fare pricing in railways which could not perform that well compared to the same in the aviation sector.The reason primarily remains that we still put high premium on intuitive decision-making rather than empirical decision-making.
The era of empirical decision-making is replacing intuition based administration in most of the organizations.Since Private sector has a survival issue if decision goes wrong ,they are more open to adopt knowledge gathering system where as government remains casual in its approach towards knowledge creation and processing.Intuition based decisions have more probability to go wrong in comparison with empirical based decision-making.It is not that private sector does not take intuition based decisions but the result is problematic there too whenever such a decision is taken. Tata nano is a classic example where the vision was very good but the car could not fit in one of the fastest growing auto industry in the world and thus, it is on verge of closure.Therefore, intuition based decisions should at best be avoided if we want to minimize the risk of failure of such decisions.
Decisions ,whether they are small or large, write the fate of the organizations.The quality of decisions can deeply impact the future of an organisation .Today, many development projects are facing cost overruns and time delays because most of them lack the scientific base which a decision should essentially carry.The government takes decisions which have a great likelihood of deciding the destiny of the society.The stake in every single decision is very high from societal point of view and we can ill-afford to take decisions which have low information base.
Government must expediently work on knowledge gathering and processing systems and link it to the decision making so that decision-making becomes more scientific and accurate.This can be easily done by creation of quality data repository which should cover both the earnings and expenditure side of the government business.For example, in India so many public bodies make buildings , roads and bridges but there is not a single platform where one can look for the rates at which they are being built at various locations.As a result , decision-making is done on the basis of a very small and localized information base.The above is only a small example and many others can be cited in other spheres of governance.India being an IT superpower should create strong technology backbone of its government departments if it wants to see dramatic improvement in the allocation and utilization of resources.
PS:The Image credit goes to Wikipedia