GUIDELINES TO NRDC feb 24 2014

Adaptive Decision MakingIntroductionDefinition:adaptivetechniquesIntuitionPurely rational decisions take time and rigorous use of logic. Time may notallow one to gather all facts and carefully weigh pros and cons of alternatives.Nor is this always necessary. Instead, we use adaptive techniques.This section describes the following adaptive techniques:x Intuition.x Rules of thumb.x Calculated delay.x Exploration.x Hedging.x Decision staggering.x Flexible decisions.x Mixed scanning.Adaptive techniques are a combination of logic, intuition, and common sense.While not precise, they usually produce a satisfactory if not ideal solution.Use these techniques when you--x Have little time.x Don't need exhaustive analysis.x Can accept affordable risks.Note: Taking risks requires boldness and prudence. A risk is worth taking ifit's affordable--can write off loss or repair damage without too much cost.Have you ever seen something that looked in order, but somehow you knew itjust wasn't right? That was intuition working. It's a form of truth, based onemotions, values, and experience--your gut feelings and your heart!While often able to arrive at the truth through intuition, don't rely on itexclusively. It can trigger snap judgments and rash decisions. Use logic first,then supplement it with intuition to make the decision "feel" right.CalculateddelayHedgingFlexibledecisionsThis is intentional procrastination. If an immediate decision isn't necessaryand there's time to develop options, let it wait. Sometimes doing nothing isthe best decision; the problem either goes away, or events overcome it.Avoid decisions that lock you into a single choice. Hedging is a decision withbuilt-in safeguards. Astute investors don't "put all their eggs in one basket."They spread risks through a balanced portfolio of stocks, bonds, and cash.Before making an irreversible decision, build some options into it.Example: Before buying a computer, consider leasing one first.NRDC GRC – Staff Handbook 5-10