Decision Making

1. Why decision making is the primary role of managers?

2. Explain the eight steps of decision making.
3. What’s constrain to make a good decision?

Answer

1. Managers have to make decisions every day, and the process used in making a decision is
important to their bottom line. The inability to define one’s position in any given situation
can ultimately affect not only the company, but the manager as well.
Looked upon as an indecisive leader, a manager’s failure to make a decision can cause chaos
among employees, and interrupt the overall production and efficiency of the staff.
Conversely, a manager who not only has common sense, but has the ability to act quickly in
any given situation is viewed more favorably among the employees.
Decision making does not allow for second guessing. A manager must make the
determination based on the facts presented, and proceed with a quick and professional
judgment.

So too, a manager cannot make a decision and then subsequently change that decision
because of how he or she may be perceived. A good manager has to keep somewhat of a
distance from his or her employees so that the decision making process is not skewed or
looked upon as favoritism.Moreover, a manager has to maintain fairness when making
decisions. It has to be unbiased and appropriate to the situation. Arbitrarily making decisions
based on hearsay or unsolicited information is unprofessional, and shows a lack of trust and
confidence – not only in themselves but in their work force as well.
2. Step 1: Define the Problem
Problem definition is crucial for making a good decision. This step identifies:
 root causes,
 limiting assumptions,
 system and organizational boundaries and interfaces, and
 any stakeholder issues.

A good problem definition expresses the issue in a clear, one-sentence statement that
describes both the initial conditions and the desired conditions. Everybody involved in the
decision-making process needs to agree on a written problem definition before proceeding.

Step 2: Determine Requirements

Any acceptable solution to the problem must meet the requirements. Requirements
describe what the solution to the problem must do.

Step 3: Establish Goals

Goals are broad statements of intent and desirable programmatic values.
 Step 4: Identify Alternatives
Alternatives offer different approaches for changing the initial condition into the desired
condition. Generally, the alternatives vary in their ability to meet the requirements and
goals.

Step 5: Define Criteria

It is necessary to define discriminating criteria as objective measures of the goals to measure
how well each alternative achieves the project goals. Each criterion should measure
something important, and not depend on another criterion. Criteria must discriminate
among alternatives in a meaningful way and should be:

 Complete – include all goals

 Operational – meaningful to the decision maker’s understanding of the implications
of the alternatives
 Non-redundant – avoid double counting
 Few in number – to keep the problem dimensions manageable

Input from the decision-maker(s) is essential to the development of useful criteria.

Moreover, the decision-maker’s approval is crucial before the criteria are used to evaluate
the alternatives.

Step 6: Select a Decision-Making Tool

The method selection needs to be based on the complexity of the problem and the
experience of the team. Generally, the simpler the method, the better. There are several
decision-making tools available, they will be part of one of the next blog postings.

Step 7: Evaluate Alternatives against Criteria

Alternatives can be evaluated with quantitative methods, qualitative methods, or any
combination. Criteria can be weighted and used to rank the alternatives. Both sensitivity and
uncertainty analyses can be used to improve the quality of the selection process.

Step 8: Validate Solution(s) against Problem Statement

After the evaluation process has selected a pre- ferred alternative, the solution should be
checked to ensure that it truly solves the problem identi- fied. Compare the original problem
statement to the goals and requirements. A final solution should fulfill the desired state,
meet requirements, and best achieve the goals within the values of the decision makers.

3. Choices can be difficult to make. In making a decision you’ll probably rely on numerous
inputs, and you’ll certainly need to address a range of factors. Inputs will include your own
experience, knowledge, common sense and judgement, and possibly that of others involved
in the decision. They will also include factors related to types and styles of decision making.

Choices are typically made within constraints. For example, the goals and priorities of the
organization, and of your team, will no doubt shape your choices. Constraints provide the
boundaries within which decisions have to be made.
Therefore clarity about goals or objectives is essential for making better choices. Of course,
your decision may well need to address several objectives, so you will need to analyze and
prioritize these. Making a decision is rarely easy, and is often a compromise between what
you really want, the ideal, and what can actually be done. It’s rare that we have a completely
free hand in making choices.

A decision, even though well-made, is pointless without action. Decision making is about the
future, about looking forward. Making a choice should take you forward – to action. Our
definition of decision making can help you to focus. To focus on how to select the most
appropriate actions, at the least cost, and with the most advantages.

Actions have consequences, both intended and unintended. The consequences can be
detrimental or favourable to your objectives. It’s therefore crucial to consider both the
positive and negative effects which might result from your decisions. Then you’ll need to put
a plan in place to eliminate or limit the adverse effects, and capitalize on favourable
consequences.