× Close
Home » Posts tagged "Decision Making Process"

Decision Making Process

What is a Decision making Process?

Definition

A decision-making process includes the series of steps taken by a manager or another individual to initiate specific actions that meet certain needs. Ideally, decisions are made based on analyses of objective facts, supported by various tools and business intelligence (BI).

What is a Decision making Process?

Definition

A decision-making process includes the series of steps taken by a manager or another individual to initiate specific actions that meet certain needs. Ideally, decisions are made based on analyses of objective facts, supported by various tools and business intelligence (BI).

Decision-making processes play an important role in determining both organizational and management activities. Decisions are made at every management level that affect whether or not business goals are met.

In addition, decisions reflect the functional core values that an organization adopts to guarantee optimal controllability and growth.

Different options or directions are possible in every business situation. The variety of alternatives for each action makes the decision-making process a critical element of managing a successful business. It is therefore not surprising that the decision-making process is an integral part of modern management and is seen as the primary function of general management.

Every manager consciously and unconsciously makes hundreds of decisions. For managers it is therefore a reasoning process based on the knowledge, assumptions, preferences and beliefs of the decision maker. Each decision-making moment produces a final choice. The decision-making process is a continuous and indispensable part of the management of organizations and business activities.

Making decisions leads to different types of outcomes, challenges and successes. There are several approaches to decision-making, such as proactive and reactive decision-making. Proactive decision-making involves anticipating problems and events, and taking action to work around those problems and maximize successful outcomes. Reactive decision-making involves taking actions after an incident or problem occurs.

Decision-making process techniques

Techniques to support this process are divided into two categories: individual and group decision-making techniques. Examples of group decision-making techniques are the consensus method, voting, the Delphi method or participatory decision-making. When difficult decisions have to be made in daily life, many people use a list of pros and cons. This is a tool aimed at individual decision-making. The TDODAR decision-making model is also a decision-making tool. This model was originally developed for pilots in threatening situations.

It is believed that when people are rational beings, free to make their own decisions, they behave according to relational choice theory. This theory states that individuals consistently make choices that lead to the best outcome for that individual, while taking into account all available considerations. An example of a method to support the making of considerations is the cost-benefit analysis. In reality, however, there are multiple factors that can influence the decision-making process and lead people to make irrational choices. A rational decision is generally seen as the best decision to achieve set goals and results.

The decision-making process consists of several steps, depending on the method used. However, the same basic steps are reflected in all methods. The first step involves identifying a problem or issue on which to make a decision. After that, it is important to collect as much relevant information about this issue as possible and to identify the effect of various decisions. In step three, the alternative choices are evaluated and a final choice is made. The decision is then implemented in the organization, after which the situation and the impact of the decision are monitored. A rational decision-making process has several extra steps, such as weighing criteria and assessing options based on data.

Join the Toolshero community

Decision-making process tips and tricks

What are the most effective models and methods to support the decision-making process? How can I optimize my individual decision-making process? Or how do I ensure that my team makes better decisions in the workplace? How can I use the different theories of decision-making for my personal development?

OODA Loop by John Boyd explained

February 28th, 2024

OODA Loop process: this article describes the concept of the OODA Loop process, developed by John Boyd in a practical way. Next to what it is (meaning and theory), this article highlights the improatcne of interaction with environment, the…

Decision Matrix Analysis

November 11th, 2023

Decision Matrix Analysis: this article explains the Decision Matrix Analysis in a practical way. After reading it, you will understand the basics of this powerful decision making method. This article also contains a downloadable and editable Decision Matrix Analysis template.…

Ladder of Participation (Arnstein)

September 12th, 2023

Ladder of participation: this article explains the ladder of participation or ladder of citizen participation, developed by Sherry Arnstein in a practical way. The article starts with an introduction, followed by a general explanation of the ladder of participation,…

Request for Information (RFI)

August 31st, 2023

Request for Information (RFI): This article explains a Request for Information (RFI) in a practical way. Next to what it is, this article also highlights where it is used, what the format is to use it, the pitfalls, benefits and…
© Copyright 2013-2024 | Privacy | Toolshero.nl (Dutch) | Toolshero.es (Spanish)