The practical world requires managers and executives to make several decisions during their career paths. Not all of them might be strategic in nature, but they certainly can have strategic personal and organizational consequences. Therefore, it is important to establish proper guidelines and processes for effective decision-making that help reduce uncertainty in most decision-making situations and aid managers in making well-informed and carefully thought-out decisions.
The following sequential decision-making framework can act as a guideline for both personal and organizational decisions.
Identify the problem.
List possible solutions.
Evaluate all solutions.
Choose the best solution.
Communicate it.
Implement it.
Evaluate the results.
The 7-step process is neither comprehensive nor conclusive. It only provides a general outline for making a decision. Firstly, it is important to clarify the exact problem that the decision maker needs to solve. At this stage, the causes and effects of the problem need to be identified in order to create a holistic picture. Once the problem is identified, all the possible alternative strategies available to rectify it must be listed. This stage can also be considered as the information gathering phase. To be exhaustive, it is important to think of ‘taking no action’ as a solution as well.
The evaluation stage considers the possible consequences of choosing each of the listed solutions. It should take into account the impact on all the stakeholders involved. Moreover, it is a good exercise to weigh all the factors involved in making a decision. The solution with the highest overall weight can then be selected as the best solution. Communication is an important aspect of effective decision-making. Once a possible winner solution is chosen, it must be clearly and unambiguously communicated to those involved in its implementation and evaluation.
Support must be provided to implement the solution for best results. Decisions made and forgotten tend to yield poor results, then decisions pursued rigorously. Last but not the least, it is important to measure and evaluate results to see whether the forecasted consequences were accurate or not. If the problem still persists, the decision maker needs to revisit the process.
A decision-making situation arose for me when I had to buy my first laptop. Without giving much thought to my possible options, I chose HP Pavilion dv5. It was certainly not a good decision for me as after 3 months, my laptop’s motherboard short-circuited. Upon investigation, I found out that the model had a manufacturing defect and the company was pulling it off the market around the time that I had bought mine. If I had used a proper decision-making process, I would have gathered all the information and considered all the alternatives, thereby avoiding the loss.
On the other hand, I made a good decision when I decided not to buy HTC Desire. I identified my need of a cellphone and considered my options (Apple, Samsung and HTC). My internet research convinced me that HTC Desire was the best option given budget and required specifications. However, while gathering first-hand information to evaluate all my options, I came to know about a processor malfunctioning experienced in some HTC Desire handsets. Therefore, I chose not to go through with my initial choice and I bought an iPhone instead. Even after 2 years of use, I have experienced no problems with my cellphone. These experiences taught me that a systematic approach is important in decision-making.
Despite the benefits of using a structured approach for decision-making, it is not possible to utilize it always. Depending upon the complexity of the problem at hand, the process might have to be tweaked to suit the needs of the specific situation. Similarly, in some situations, it might be more important to make a quick decision rather than the right decision. These special needs of a decision-making situation can be uncovered in the identification stage, helping the decision maker to make better and well-informed decisions within the given time and resources.
References
Fulop, J. (2005). Introduction to Decision Making Methods. Computer and Automation Institute, Laboratory of Operations Research and Decision Systems. Washington: BDEI-3 Workshop.
