Q&A with Viraj Narayanan

Viraj Narayanan (DC’07) majored in Decision Science. He was drawn to the scientific approach to decision making and could relate to the traps that often derail good decisions.

After graduating, Narayanan joined Decision Strategies International (DSI) – a boutique consulting firm that helps organizations think strategically in an increasingly complex and uncertain marketplace. For the past 7 years he has worked with fortune 500 companies on problems that center around strategic decision making under uncertainty. Narayanan is starting an executive MBA at the Wharton School (class of 2016) as a fellows candidate – designated for individuals with less than 10 years experience that have demonstrated exceptional management potential.

Recently, Narayanan sat down with Dietrich College News to talk about his role at DSI and how his Carnegie Mellon University education has prepared him for his career.

What is your role at DSI and what kind of projects do you work on?
I wear two hats at DSI –I am a project manager for client projects with large global companies and internally I manage initiatives, like talent development, to help build the business. Projects are fast paced, fluid and roles can be ambiguous. Often times my job is to put structure and definition around a problem.

DSI’s advises companies on decision making under uncertainty. As an example: senior leadership of a large pharmaceutical company wanted to align strategy to uncertainty and change factors in the healthcare environment. We used a disciplined process to align and create a vision for US healthcare 2020. This vision or future state was a platform to test decisions today. As an analogy, if I told you it was going to rain tomorrow, you would wear a raincoat or use an umbrella. DSI helps companies prepare for the future weather conditions.

What are some of the good and bad decision making trends that you see within companies?
As human beings, we all have biases or pre-conceived notions. As a die-hard Philadelphia sports fan, I believe my team hustles harder and therefore deserves to win. Biases that are too often in the same direction or error prone are what get us into trouble. This is particularly relevant in business – where an individual’s bias can be magnified in a team, division, and even a company. A collective narrow or myopic perspective can mean missing the next opportunity or being blindsided by a competitor. Interestingly, having expertise doesn’t shield you and in some instances can even make you more prone to bias. Why change your perspective if what you have done to this point is working? As Bill Gates famously said, “success is a lousy teacher."

One client, a prominent asset management company, was interested in understanding how portfolio managers could be falling prey to bias in making investment decisions. Our findings, delivered as a field guide handbook, illustrated specific bias-driven behavioral patterns or archetypes that derailed investment results. One common pattern was overconfidence, where investors took great conviction in a position without a thorough or fact-based process. We found that overconfident investors dismissed counter perspectives, blamed external factors more than their own behavior when assessing performance, and tended to seek evidence that only confirms their thesis. My guess that most people reading this have seen some flavor of overconfidence in the workplace derail a project or team.

The good news is that many best practices exist to overcome various biases. For combating overconfidence, assigning a devil’s advocate in meetings is simple way to maintain a balanced perspective. Another familiar practice is creating scenarios about the external market assumptions and stress testing decisions against these scenarios. I recently wrote about nudge strategies, a creative way to promote wellness. Cleveland Clinic has removed soda machines on campus and provides free gym classes to employees. This eliminates a bad decision completely (soda) or makes a decision easier (free gym classes).

Changing habits is crucial to overcoming myopic decision-making. I have written about Susquehanna Group, a financial trading company that uses poker to help analysts become comfortable with the feeling of risk taking. Repetition and practice help make new habits stick. With many of DSI’s clients, we provide training sessions that combine educational awareness with application of tools. An intervention, where you are forced to step away from your day job, is more action oriented than just reading the findings of a consulting project.

How do you feel your CMU education prepared you for your career so far?
I feel the decision science curriculum emphasizes core workforce skills. At the center is critical thinking, a scientific approach to problem solving, and a respect for the human biases that get in the way of good decision making. The nature of my professional work, helping organizations develop strategic thinking, happens to fit well with my undergraduate training. More broadly though, I think there could be more education on decision science and critical thinking skills, because the world is definitely moving towards more interdisciplinary solutions.

CMU undergrad also instills a work ethic. I was pushed intellectually and like most other students, spent a lot of hours at Hunt Library. I think that there is a certain gritty and persistent quality that embodies CMU. At a basic level, it reinforces that nothing is given to you; it has to be earned through hard work.

What has surprised you the most about your work?
I would highlight the importance of talent and having the right people. In my client projects I serve as the project manager, driving internal planning for a team of DSI consultants and externally acting as the day-to-day point of contact for the client. When you have a high performing team working collaboratively together it is a beautiful thing what you can accomplish. I love these teams because they have high accountability, clear roles, and a sense of purpose. Building these qualities takes time, commitment, and the right fit. That’s why I think recruiting, developing, and keeping talent is so key.

What do you miss the most about your time at Carnegie Mellon?
Carnegie Mellon is truly diverse. I met so many people that thought about the world in different ways, including some of my best friends today. At CMU you check your ego at the door, it really is all about the work. I miss that nerdy, social-classless, feeling that is special to CMU.

Each of the undergraduate institutions offers a new lens to the world. While I was there I took courses in all five undergraduate institutions, which definitely broadened my horizons. I still reference my favorite class – behavioral economics taught by Ted O’Donoghue. In fact, I gave an internal training recently at DSI on behavioral economics for which I looked back at my class materials. The diversity: academic and student body is something that I remember fondly.

How could people get in touch with you?
Email: Narayanan@decisionstrat.com
LinkedIn Profile: www.linkedin.com/in/virajnarayanan