Decision-Making

Life is full of decisions.

From the moment we wake up to the time we get to bed, we are faced with decisions. These decisions vary in gravity and impact. It can range from what to have for breakfast to what field to pursue in college.

Making decisions is all about choosing a course of action from the available alternatives in order to achieve a goal. Depending on the size of the decision you are making or the type of decision-maker you are, you could be making your decisions in a snap or only after going through a careful and deliberate step-by-step process.

As a leader in any organization, your actions could decide the future of the entire organization. Finding opportunities and avoiding problems are part of the decision-making process. One of the most crucial factors to consider when deciding as a leader is the ethics of your decision.

When evaluating the ethics of your decision, these are some of the fundamental questions to ask:

• Is this fair?
• Will I feel better or worse about myself after I make this decision?
• Does this decision break any organizational policy?
• Does this decision violate any law?
• How would I feel if this decision was made public?

Types of Decision

• Rational Decisions Those that went through a formal decision-making process with the goal of improving and optimizing results
• “Good Enough” Decisions Those that are made after selecting from a limited set of options and chosen without a thorough search for alternatives
• Intuitive Decisions Those that are made without thinking about them
• Creative Decisions Those that are made with the goal of creating new and inventive ideas

Intuition vs Instinct

Creative Decisions

Creative decisions are said to be made through the following step-by-step process:

• Step 1: Problem Recognition
• Step 2: Immersion
• Step 3: Incubation
• Step 4: Illumination
• Step 5: Verification and Application

Creativity is said to be made up of fluency, flexibility, and opportunity. Furthermore, experts have said that creativity is the result of a combination of the following:

1. people’s personal qualities (e.g. openness to new experiences, risk-taking);
2. their attributes (e.g. expertise, imagination, motivation); and,
3. the surroundings (e.g. encouragement from others, time pressure, physical structures).

Other Types of Decisions

Aside from the four general types of decisions mentioned above, we also have the following types of decisions to consider:

• Strategic Decisions vs Routine Decisions As the name implies, strategic decisions are the important decisions in an organization. They are usually taken by middle and upper-level manager and require analysis and careful study. They affect the entire organization, including routine decisions which involve the daily functioning of the organization. High-level managers would generally delegate these types of decisions to their subordinates.
• Programmed Decisions vs Non-Programmed Decisions Programmed decisions are those that are repetitive and does not bear deliberation. As the name implies, these decisions are made by following a specific protocol. These are usually done by lower management. Non-programmed decisions come from situations which do not have a standard procedure setup for them. These are some of the more important decisions of the organization and are usually made by upper management.
• Policy Decisions vs Operating Decisions Policy decisions are tactical decisions that involve the policy and planning of an organization. They are usually made by top management and have a long-term impact on the organization. Operating decisions, on the other hand, are those that act on policy decisions. They are usually handled by middle and lower management.
• Organizational Decisions vs Personal Decisions Organizational decisions are those made by a decision-maker in the firm in their capacity as a leader. These decisions can be delegated to subordinates. Personal decisions are those taken by these same people but are not in any way related to the organization’s operations. These cannot be delegated to subordinates.
• Individual Decisions vs Group Decisions Individual decisions are those taken by leaders in an official capacity. Group decisions are those taken by multiple members of the same organization, e.g. a board of directors, in their capacity as decision-makers in the organization.

Problem-Solving

Problem-solving is the analytical method of finding answers to challenges. The primary goal of the process is to find the best solution to an issue and achieving a goal.

The first step when attempting to solve a problem is to clearly identify it. You may have to ask yourself questions like:

• What happened?
• Why did it happen?
• How do we know there is a problem?
• What do we need to do to remedy the problem?

Supplemental | Before You Decide: 3 Steps to Better Decision-Making