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Focus on Micro-decisions for Macro Impact


One of the key benefits of decision management is its focus on operational decisions. Diving into these operational decisions further, you can typically identify several micro-decisions that, when improved, will dramatically affect business performance.

“Micro-decisions” are the decisions made transaction by transaction, customer by customer. Companies often fail to recognize these as individual decisions, instead lumping them into bigger ones. For instance, instead of identifying that each price offered to each customer is a micro-decision, they consider “pricing” as one big, strategic decision. Failing to consider these micro-decisions as separate decision-making opportunities means you are unable to fully leverage the personalization or targeting of these micro-decisions to individual customers. This in turn means you cannot take advantage of all that lovely data you have about customers, or reward customers based on loyalty metrics, or….

Even if you don’t want to completely automate a micro-decision, it would be wise to think about using Decision Management to reduce the range of options available to a human decision-maker, or at least rank the available options by likely effectiveness. A decision service can be used to either fully automate a micro-decision or provide support for human decision-making, as described. It is also important to match these micro-decisions to objectives and to measure them so they can be improved over time.

Micro decisions are made often, typically thousands of times a day. This means that any improvement in the effectiveness of these decisions has an outsized impact. Even a small increase in profitability, customer retention or net promotor score resulting from a micro decision scales up -its value is multiplied by the thousands of such decisions you make. The total impact often exceeds much more “strategic” decisions.

Decision Management and micro-decisions are a great way to gain a macro impact.