Decision Making: How it Works and Ways of Improving the Process

Decision Making: How it Works and Ways of Improving the Process

Decision making is so pertinent in today’s businesses. As a matter of fact, every staff or team member is expected to contribute to the decision-making process of an organization. According to UMass, decision making is the process of making choices by identifying a decision, gathering information, and assessing alternative resolutions. Why is the decision-making process very delicate and important? Because if it’s wrongly executed, can reward catastrophic effects on performance, efficiency, and ruin subsequent decision-making processes.

This reason and more is why one must know how the whole decision-making process works and always strive to improve it.

Read on to unravel the decision-making mechanism, tools used, and how to improve the overall process.

How Does Decision Making Process work?

To design a model or improve it, one must first know how it works. Only then can it be tweaked to favor your needs/ requirements.

Decision making is basically the process of taking some important decisions in specific situations that favor the team or organization. Chegg.com educates that there exist three different types of decisions:

  1. Unstructured decisions
  2. Structured decisions
  3. Semi-structured decisions

These decisions are made by these three levels of management in an organization, namely:

  • Senior management
  • Middle management, and
  • Operational management.

Senior management is allowed to make unstructured decisions. Middle management takes semi-structured decisions while operational management takes on structured decisions.

Each of these levels of management all have different sets of decisions to make. Also, their information requirement differs from each other as well.

How Sense of Purpose Affect Decision Making Process

In Simon Sinek’s TEDx talk, he expounded on a theory why some products, people and organization fail compared to others that succeed.

Finally, he concluded that it all comes down to the biology of the decision-making process– Our brain.

The neocortex is a part of the brain responsible for powerful thinking that makes the decisions based on the information we have at hand.

In truth, one would think we are entirely supposed to make decisions based on facts and data. However, we still make them based on our emotions which are driven by our purpose- why?

It Makes Communication and Marketing Easier

Having a sense of purpose helps provide a central focus for all communication and marketing aspect of your organization.

This sense of purpose helps one evaluate everything that leaves your organization internally and externally so you can see how well it stacks up to your advantage/purpose.

Team success requires more than facts and numbers because a good product is critical, but a sense of purpose and mission is more relevant. Follow your sense of purpose during the decision-making process so you can make decisions that contribute toward your organization’s success.

>> Recommended reading: How to Develop Leadership Skills in Your Team

Tools for Decision Making

Learning how the decision-making process works and why a sense of purpose is relevant in the process isn’t enough to go ahead and start making decisions.

According to a Medium article on decision making, these are a few tools used in the process:

  • Market research
  • Decision Matrix
  • Cost-Benefit Analysis
  • Feasibility study

There are many other sophisticated tools for analysis of alternatives that’ll aid the overall decision-making process.

>> Recommended reading: A Culture of Results: You Can’t Manage What You Don’t Measure

Improving the Decision Making Process

7 steps towards improving your decision-making process are:

Identify the decision: What is the problem or issue at hand/ You must clearly identify what you want to achieve as this initial step helps pave way for the next steps.

Gather Information: After the identification of the decision, you need to go further by learning more about the decision. However, in order to do this, you require more information about the decision.

Therefore, you have to know the kind of information you need, how you’ll get it and how you’ll finally use them. Review and assess the information as whatever you learn from this phase will help you know more about the situation and eventually give you a wider perspective on prospective alternatives.

Identify Prospective Alternatives: This step is tricky because it might be fun for some as they might feel like they’re making headway while It can also be overwhelming for others- why?

They do know that identifying the next step/alternatives would lead to the next step that dives deep into unknowns and potential impact. Snhu advises that brainstorming can be really effective and helpful when it comes to identifying prospective alternatives.

Weigh the Evidence: This step involves harnessing all the information gathered and identified alternatives to weigh your options. Consider the effect each alternative would have on the outcome, people, the risks and opportunities and alignment of values.

While you reflect on the impact of each alternative and how they may resolve the problem, begin to rank the alternatives according to their positive impact.

Choose an Alternative: After you have evaluated, weighed and ranked the different alternatives based on your solid understanding and judgment of the possible outcomes of each alternative, you have to choose. Select the best alternatives after which you take action.

Take Action: Choosing a decision wouldn’t make any influence if it’s not executed. Apply the principle of practice and make your selected alternative a reality. When you choose an alternative and don’t take action right away, you stall the decision-making process.

Use the best practices that were recommended while researching and gathering information about that alternative.

Review: This is the final step of the decision-making process. After some time of practicing your alternative i.e. weeks or months, evaluate whether or not the outcome resolved the initial issue.

Use performance metrics to check if the outcome has been achieved within the timeframe identified.  If the outcome is great, you would want to see what went right and learn from the challenges. However, if the outcome isn’t great, you may have to refer to step 4 and explore other alternatives.

>> Recommended reading: 4 Steps to Develop a High-Performance Team

In Conclusion

The decision-making process has to be carefully and pragmatically executed. Follow the aforementioned steps to improve your team’s decision-making process. A work management tool like Runrun.it can be of immense help in this process.

Use Runrun.it to gather data regarding every activity performed in your company. It provides performance and time reports to make the right decisions. Sign up for a free trial of this innovative work management platform at: http://runrun.it

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