Question

As a business decision maker, your choice is (a) to roll the dice and hope that if the exchange rate changes, it will be in your favor, or (b) to pay a fee to be assured of a rate of exchange sometime into the future (30-60-90 days or more).

If you have a manager working for you proudly report to you that he/she "saved" your organization $6,285 by taking option (a) above, what would you say to that person?

Answer 1

I would appreciate the person for saving the company $6295 by saying "Good" but also point out the most important problem in the business decision-making process. Business decision-making is not made by rolling dice and hoping for a miracle but rather gathering information, data relevant to the decision, and evaluating every alternative to reach a conclusion. The decision-making in business always should be a rational decision and not a gamble. The problem with making decisions using a gamble is that they don't always work in your favor. The manager who rolled the dice and hoped for a positive outcome should not be encouraged to make such decisions in the future.

I would appreciate the outcome of the decision but not the decision-making process. Taking calculated risks is a part of decision-making and therefore any manager making hasty decisions like this one should not be motivated or encouraged to pursue this decision-making process.