Dealing With Uncertainty

Posted on May 15 2009

Dealing with uncertainty can be an issue, when our every day lives are incredibly complicated. The complexity has ensured us that it is nearly impossible to make decisions with absolutely certainty. We must deal with some degree of uncertainty on each decision we make. Different levels of are held because of the factors involved.

This does not mean that we can’t assess the level of uncertainty and choose a Decision Making Process appropriately. We have to separate what is known, from unknown, and how to apply that information to our decision. Sometimes additional analysis is all that required, and analysis of what is not known is crucial.

Once we have gathered all the information needed, we must deal with uncertainty. Usually, a decision that employs some flexibility is the best solution. We cannot lock ourselves into a decision that will negatively impact us severely in the future.

The next step is to successfully incorporate strategies for dealing with uncertainty into the dispute resolution process. In general the key to dealing with uncertainty is to retain as much flexibility as possible.

Rather than locking oneself into a decision which might be disastrous, try to make decisions that can be adjusted for changes later or something which occurs in the future.

An alternative approach is insurance, which compensates people who get harmed by an unexpected or unlikely occurrence. Risk avoidance is another approach. Assessing risks associated with each alternative is one way to quantify and judge the merits of each potential solution, thus reducing uncertainty.

If your decision is financial, there are many valuation models that can be used to reduce uncertainty.

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