Decision-Making Process

 Eight Steps in the Decision-Making Process

Step 1: Identifying a Problem 

Your team is dysfunctional, your customers are leaving, or your plans are no longer relevant. Every decision starts with a problem, Decision making is an eight-step process that begins with identifying a problem and ends with evaluating the outcome of the decision. After problem identification, managers must determine the decision criteria that are relevant to solving the problem.

Step 2: Identifying Decision Criteria 

Once a manager has identified a problem, he or she must identify the decision criteria that are important or relevant to resolving the problem. Every decision-maker has criteria guiding his or her decisions even if they’re not explicitly stated.

Step 3: Allocating Weights to the Criteria 

If the relevant criteria aren’t equally important, the decision-maker must weigh the items in order to give them the correct priority in the decision. How? A simple way is to give the most important criterion a weight of 10 and then assign weights to the rest using that standard. Of course, you could use any number as the highest weight.

Step 4: Developing Alternatives 

The fourth step in the decision-making process requires the decision-maker to list viable alternatives that could resolve the problem. In this step, a decision-maker needs to be creative. And the alternatives are only listed, not evaluated just yet.

Step 5: Analyzing Alternatives 

Once alternatives have been identified, a decision-maker must evaluate each one. Sometimes a decision-maker might be able to skip this step. If one alternative scores highest on every criterion, you wouldn’t need to consider the weights because that alternative would already be the top choice. Or if the weights were all equal, you could evaluate an alternative merely by summing up the assessed values for each one. (Look below Table) For example, the score for the HP ProBook would be 36, and the score for the Sony NW would be 35.

Step 6: Selecting an Alternative 

The sixth step in the decision-making process is choosing the best alternative or the one that generated the highest total in Step 5. In our example (below table), Amanda would choose the Dell Inspiron because it scored higher than all other alternatives (249 total).

Step 7: Implementing the Alternative 

In step 7 in the decision-making process, you put the decision into action by conveying it to those affected and getting their commitment to it. We know that if the people who must implement a decision participate in the process, they’re more likely to support it than if you just tell them what to do. Another thing managers may need to do during implementation is reassess the environment for any changes, especially if it’s a long-term decision. Are the criteria, alternatives, and choices still the best ones, or has the environment changed in such a way that we need to reevaluate?

Step 8: Evaluating Decision Effectiveness 

The last step in the decision-making process involves evaluating the outcome or result of the decision to see whether the problem was resolved. If the evaluation shows that the problem still exists, then the manager needs to assess what went wrong. Was the problem incorrectly defined? Were errors made when evaluating alternatives? Was the right alternative selected but poorly implemented? The answers might lead you to redo an earlier step or might even require starting the whole process over.