Decision making in business is very important that deals with the decisions that are made on behalf of the organization. It sometimes has an option on poor choices but it will be legal. Once there is a clear understanding of the problem then the decision can be made in an alternative manner.
Decision Making Meaning?
Decision making is a process of selecting a formal choice among the given options. For an effective decision-making process, one must be in a stable mind to weigh both positive and negative options. One should determine which option will suit that particular situation. In an organization decision making will be done by the higher authorities upon the analysis and critical thinking of the company.
Role of Decision Making in One’s Life:
The ability to choose the right choice depending on the problem it has, is the matter of decision making. It is important to understand the process of individual decision making. When a situation comes to decide for an optional way, the individual must be able to take a good decision rather than wavering. The fact is that people with a high range of emotions tend to make good decisions quickly.
Variables of Decision Making:
One can improve decision-making skills by recognizing some of the important variables to select the right choice. They are as follows:
a. Levels of decision
b. Styles of decision
c. Decision process that is rational
d. Decision process that is intuitive
a. Levels of decision:
The level of decision deals with the questions that are faced during the decision making process. Here the possibility is that the decision made is accompanied by the risk. One must select the option by asking certain questions such as:
- How important is the decision?
- How complex is the situation?
- How much critical decision making is?
b. Styles of decision:
These styles deal with the degree of participation in the process. In corporate world, participation is considered as time-consuming activity. It involves arguments, debate to prepare evidence for good decision making. Here the questions that arise are:
- To which extent others should be involved in taking right choice?
- What are all the conditions that are involved in decision making?
- Which technique is opted to select the right decision?
c. Decision process that is rational:
Rational is something that is agreeable to a certain reason. It acts as a classic approach of decision making. It has sequential steps and the desired solution. It deals with problem identification and corresponding alternative method to solve it. Here the analysis of the problem is done in different factor to determine the decision that is to be taken.
d. Decision process that is intuitive:
The intuitive decision is the mindset of the people upon how the judgment has to be given based on the consequences of the problem. It is less structured that relates to the feelings, perceptional judgment rather than analyzing the fact. The decision may not be either or but an exact solution will be obtained.
Process of Decision Making:
Decision-making process involves:
1. Defining the problem
2. Clarifying the objectives
3. Identifying the alternative method
4. Analyzing the consequences
5. Making the right choice
1. Defining the problem:
Problem definition has its own way of taking an initial assessment. It has to be identified and analyzed from all the possible ways to sort it out. Here one can find the possibilities that dissect the problem. It helps to find the root cause of the problem and deal with possibilities to solve the problem. And analyze the connection between the problem and the cause. This helps in developing better problem-solving skills.
2. Clarifying the objectives:
The objectives deal with taking and collecting points on the address and hope of the problem. It changes the specific objectives in a concerned manner. It provides a separation between the ends to explore new objectives. It clarifies the path towards each objective. To test each objective, one must concentrate on capturing their interests.
3. Identifying alternative methods:
One must think about possible ways to handle the situation. He/she must expand the search within the network and even the help should be obtained from the experts. One must take care of each and every objective and must know how and when to stop it. This identification of alternative methods must be dealt with already experienced people and experts to take a worthy decision.
4. Analyzing the consequences:
One must analyze the consequences mentally by viewing him/her in the future. It involves process analysis that helps in solving problems from beginning till the end. It suggests what will happen in each stage of the problem analysis. It also eliminates the inferior alternatives. It provides a concise view of the remaining members of the organization. This supports both objectives and alternatives.
5. Making the right choice:
This stage comes after the analysis of consequences. The analysis has to be done until the right choice or the right alternative is found. On certain situation, one must find a simple alternative that will help in maximizing the benefits of the organization. One must try to choose an alternative accurately. The method chosen after detailed analysis will help in the switch over to the other alternative without causing a lot of trouble.
How to Take Better Decisions?
One can take a better decision by opting to the framework of the negatively influenced factors. An instinct should be present in everyone’s mind that the act of misunderstanding, misguidance may rule one’s life easily. Here are few techniques that help in making better decisions:
a. Increase in one’s knowledge:
It depends on the research that he/she has done to overcome the problem. Asking and experiencing questions and researching and consulting about the facts that are founded. One must try to maintain the objectivity of the analyzed facts.
b. Using the intuition:
The individual must try to take a decision based on the accumulated knowledge and experience gained in it. Sometimes these intuitions make one to take wrong decisions. It is also defined as a process of making decisions in non-sequential mode. One must have good gravitate styles to take an intuitive decision.
c. Consider multiple options:
Selecting multiple options, one may feel like playing a major role. Here all the list of options should be again considered as the alternative options. One must try to take the right decision with a proper mindset. Distractions might lead to wrong decisions, so one must always consider the pros and cons of the considered alternative.
d. Balancing risks and rewards:
The balance that is provided between risk and reward is to be maintained. While taking decisions one must be able to concentrate on the good deeds of the decision taken than the bad deeds. Once if the decision is taken the individual must think of the worst and best things that would happen.
Factors of Effective Decision Making:
Effective and good decision making can be done when the cause and the consequences of the problem is analyzed effectively. The factors that help in making effective decisions are:
The Decision Making Process Involves the Following Criteria:
1. Constructing a clear picture of what has to be decided.
2. Compiling the list of requirements that are to be met.
3. Collecting the information to meet each and every alternative.
4. Comparing the alternatives to meet the requirements.
5. Considering the wrong factors in each scheduled alternative
6. Committing to a decision and following it throughout.
Inherent Traps in Process of Decision Making:
One must strive hard to stay away or to deal with it safely. Thoughts and analysis lets the biases and fear to tilt in its own way. The problem of losing mind in minutia upsets the decision maker in an organization. Craving for the approval and trying to realm the authority of it helps one to take the right decision. One will fall into the trap if the failure to achieve the target is clearly noted.
Importance of Decision-Making Skills for Students:
Decision making plays a vital role in the life of students. It diverts the students from falling into the trap that manages the students and saves their career life. The ability to distinguish between choice and needs plays a vital role in the life of students. It promotes self-determination on how to make good decisions and choices. Here are a few strategies that are to be followed while taking decisions. They are as follows:
1. Self – determination:
Self-determination is a combination of knowledge, belief, skills that enable students to become goal-directed, autonomous behaviour and even self-regulated. This is enhanced with knowing and valuing oneself, planning, acting, experiencing and learning from the outcomes.
2. Learning disabilities:
These learning disabilities are experienced by the students for which they have to acknowledge the available resources. They should try to disclose their weakness with the concerned member as they may try to help the students.
3. Understanding strengths and weakness:
If the student is capable of understanding the strengths and weakness then they must try to make effective decisions and an alternative method to obtain it.
Helplessness deals with effects of failure in which one can predict the past and future effects of failures. It often leads to lack of positive and effective decision-making skills. The accuracy has to be found within the strength and weakness and even the preferences are taken into account.
5. Socialization skills:
Socialization skills are usually decided learned from special education or through individual tutoring methods. Majority of students fails in effective decision-making skills. It helps in understanding and learning the skills of making different alternatives.
These instructions enable the students to make them learn infused counselling of various programs, dealing with academic support classes that include extra-curricular activities. This instruction provides effective choices for figuring the disabilities within the students.
Importance of Decision-Making Skills for Managers:
A manager must constantly try to make good decisions in advance. He/she must try to cope with the issues that the organization faces. It matters from the planning stage to controlling or settling. Here it deals with the entire organization policies and goals. The manager should be capable of getting quick and correct solution for the problem faced. It involves:
- Better usage of resources.
- Facing challenges and problems.
- Dealing with business growth.
- Increasing overall efficiency.
- Achieving objectives.
- Innovating new ideas.
- Motivating employees.
Right Decision Making in Management:
Decision making is done in a wise manner by a person who follows his instincts and knowledge. It represents one’s own actions that are done in a wise manner to achieve the objectives. The manager must possess all the managerial functions such as planning, organizing, directing, staffing, coordinating and controlling the employees. Decision making acts as the core of all the process in the organization. This decision making sometimes contributes to the following:
- The consequence of high risks
- Interpersonal issues
The manager in an organization must focus on step by step process which is given below:
1. Creating a constructive environment
2. Investigating the situations in detail
3. Strive for the best alternative
4. Establishing new options
5. Selecting the best solution
6. Evaluating one’s plan
7. Communicating with other members of the organization
8. Taking actions that are discussed in decision making.
Thus decision making plays a vital role in everyone’s life. It optimizes the destruction and focuses on concentration towards achieving the goals either in an organization or in a career. More the information is collected, easier the decision-making task will be. The final decision that is fixed must be trustworthy and should not be biased data.