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Six Thinking Hats

In: Business and Management

Submitted By WhitneyKristina
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Industrial Grinders currently manufactures and sells steel rings along with the machines they also manufacture and sell through another division of the company. Having recently discovered that their competitor is selling plastic rings that serve the same purpose, lasts longer and are cheaper than the steels rings they produce; Industrial Grinders has decided to manufacture plastic rings. Lawrence Bridgeman, general manager of the German plant, has to determine whether or not he should scrap a large quantity of steel, manufacture and sell both steel and plastic rings or continue to manufacture and sell steel until their stock of steel is used up. In order to make this decision, it is essential that Lawrence implement critical thinking and decision making strategies among other resources. There are a lot of details to consider in regards to this decision, such as the value of the remaining steel, the amount of steel rings on hand, the cost of the industrial machines, and how much money would be needed to produce the plastic rings inclusive of the necessary tools and equipment. With gathering all the necessary information Lawrence would be using the white hat from the Six Thinking Hats process, an important and prevailing technique that allows a person to look at decisions from a number of important perspectives. This procedure provides a well-rounded view of a situation, forcing you to move outside your habitual thinking style. Colored hats are used as metaphors for each direction. Switching to a direction is symbolized by the act of putting on a colored hat, either literally or metaphorically. These metaphors allow for a more complete and elaborate separation of the thinking directions. Information, Emotions, Discernment, Optimistic Response, and Creativity, The six thinking hats indicate problems and solutions about an idea the thinker may come up with. If Lawrence Bridgeman puts this process into practice he will encourage creative thinking within decision-making and the final decision would be more resilient. It would cover all aspects emotions, pessimism, optimism, and alternative solutions. The general manager can use this process individually or with the other managers and also the head office in Holland. The meeting may start with everyone assuming the Blue hat to talk about how the meeting will be conducted and to develop the goals and objectives. The conversation might then move to Red hat thinking in order to gather opinions and reactions to the problem. This phase may also be used to expand constraints for the actual solution such as who will be affected by the problem and/or solutions. Next the discussion may move to the Yellow then Green hat in order to generate ideas and possible solutions. The discussion may then move between White hat thinking as part of developing information and Black hat thinking to develop criticisms of the solution set. According to the case there is an excess of $93,000 dollars in special steel that cannot be sold even for scrap. The unprocessed inventory of steel is valued at $26,400 and represented enough material to produce approximately 34,500 rings. The steel rings manufactured by Industrial Grinders had a normal life of about two months depending on the extent to which the machine was used. However, the plastic rings also had at least four times the wearing properties of the steel ring and the necessary tools along with equipment could be obtained for about $1800 dollars; all vital information to be considered by the white hat. Red hat thinking may suggest it makes no sense to throw away such large amounts of inventory, the demand for steel rings would be completely destroyed and customers that purchased steel rings would find out about the plastic ones affecting consumer relationships. Moreover, that the switch to plastic rings would be highly cost effective. The yellow hat realizes that no more than 10% of Industrial Grinders markets would be affected, if selling price of both rings remained at $320.40 the additional profit from the plastic rings would more than recover the value of the steel inventory. The green hat offers creative alternatives such as selling the steel in markets where the plastic rings have not been introduced or significantly reducing the price of the steel encouraging consumers to purchase them instead of the plastic rings. Using black hat thinking, all the bad points of the decision will be identified. Perhaps more than 10% of the market share would be affected by the execution of plastic rings; another company may begin to produce the plastic rings and Industrial Grinders will have more than one competitor. Additionally, the parent company may override the decision if they don’t deem it the right one. The Six Thinking Hats method is an ideal way to attempt to solve the problem that the general manager is faced with. However, there are many more approaches he can take while contemplating his decision.

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