Li Keqiang Index and Decision Making

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Here is link for signing up a virtual event organized by my publisher?New Degree Press?about my book hosted by?John Saunders, CIMA?.

https://lnkd.in/gS5hc4NC

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Decision making is a process of selecting the best course of action from among multiple options. In order to make effective decisions, one needs to have a deep understanding of the problem at hand, as well as the context in which the decision will be made. This requires more than just access to information; it requires insights. Insights are a deeper understanding of the underlying causes and relationships that drive a problem or situation. They allow decision-makers to see beyond the surface-level data and identify patterns and connections that would otherwise go unnoticed. Effective decision making often requires the balance between being well informed vs. sound judgement based on insights.

“The world cannot be understood without numbers. But the world cannot be understood with numbers alone.”?

This quote from the book “Factfulness” by Hans Rosling is a powerful reminder for decision making. In an increasingly digitalized world, we are all bombarded by more information and numbers (Rosling et al 2020).?

In Factfulness, Rosling cited a conversation he had with Pascoal Mocumbi, the prime minister of Mozambique at the time. When the author asked the prime minister about the economic statistics for his country, the prime minister said, “I do look at those figures, but they are not so accurate. So I have also made it a habit to watch the marches on May 1st every year. They are a popular tradition in our country. And I look at people’s feet, and what kind of shoes they have. I know that people do their best to look good on that day. I know that they cannot borrow their friend’s shoes, because their friend will be out marching too. So I look. And I can see if they walk barefoot, or if they have bad shoes, or if they have good shoes. And I can compare what I see with what I saw last year.”?

A wise prime minister looks at the numbers, but not only at the numbers.

In my newly released book: The Odyssey of Self-Discovery: On Becoming A Leader (https://lnkd.in/g7kZcpY3), I discuss?another similar episode of Chinese Premier Li Keqiang, the current Chinese Premier with whom I had the opportunity to meet in 2018 during my business assignment in China. (see the cover photo and CCTV report: https://tinyurl.com/4ajtdvxe)

During a dinner meeting with the American ambassador to China, Clark Randt, Premier Li discussed about the China's economy. Ambassador Randt reported that Mr. Li did not think that China's GDP figures at the time were always reliable and that he instead focused on three different sets of data to measure his province's success: electricity consumption, bank lending and rail cargo volume. The appearance of the memo in the press then led The Economist magazine and other China-watchers to employ the so-called Li Keqiang Index themselves, as part of ongoing attempts to devise what was going on in China behind the official statistics.

Even in the sports world where data analytics are becoming powerful tools for many professional teams, the most successful teams, while leveraging data analytics as a tool, still rely on experienced coach and managers who have the insights to make key decisions.

In the business world, decisiveness is key to effectively executing plans and achieving goals. Leaders need to be willing to take charge and not shirk from decisions, especially during difficult times. It is important to balance the costs of continuing to deliberate, gathering information, vs. making decisions based on insights which are often from experience, sound judgement. Decisiveness instills confidence and creates clarity for organizations.?

Related Article

Data Analytics vs Intuition for Decision Making (11/19/2017)

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