Tom Inglesby, editor
In July of 2016, a man who taught how analysis could become second nature passed away. Howard Raiffa was 92 when he died and 48 when I met and worked with him. Raiffa was an economics professor whose mathematical formulas for decision making were applied to the search for a missing nuclear bomb and the siting of a Mexico City airport.
Professor Raiffa co-founded the Harvard Kennedy School and taught at Harvard for 37 years. One of his claims to fame was developing and teaching what became known as decision science, a discipline that includes risk analysis, negotiating techniques, conflict resolution, and even game theory.
Instead of focusing on theory, he applied his concepts to real-world cases of the three C’s—conflict, cooperation, and compromise. “I learned a lot about the theory and practice of many-party negotiations in the presence of extreme cultural differences,” he was quoted in his New York Times obituary.
In an interview, Prof. David E. Bell of the Harvard Business School said: “Howard came up with brand-new theories that helped us understand how we should make decisions in a wide variety of circumstances. These were practical approaches, not ivory tower constructs.”
The best practical advice, Raiffa wrote, is “to maximize your expected payoff, which is the sum of all payoffs multiplied by probabilities. The art of compromise centers on the willingness to give up something in order to get something else in return.”
According to the Times piece, his students engaged in cutthroat simulated negotiations, prompting The Harvard Crimson to ask him whether the curriculum taught students to lie in actual business dealings. He replied by relating a story about the former president of the University of Chicago.
“When, in the 1950s,” he began, “Robert Hutchins was hauled before a congressional committee and asked if it was true that the University of Chicago taught communism, he replied: ‘Yes. And in the medical school we teach cancer.’”
“It’s a valid analogy,” Raiffa said. “To deal with a problem, we have to teach about it.”
Students of his recall he would close the course with, “When we see we could improve our profit or further maximize our desired result, we might ask, Is this a ‘dirty dollar’ or a ‘clean one’ that we could earn? What would happen if everybody did this? Would we be able to sleep at night if we did this? How would we feel if we had to explain this to our families?
“I hope that in answering these questions, you will favor the course of action embracing a higher moral standard.”
Raiffa died before the 2016 elections, the results of which might have tested his theories to the limit. RIP, mentor.