In
psychology, decision-making is regarded as the cognitive process resulting in
the selection of a belief or a course of action among several alternative
possibilities. Every decision-making process produces a final choice that may
or may not prompt action.
The thought process of selecting a logical choice from the
available options.
When trying to make a good decision, a person must weight
the positives and negatives of each option, and consider all the alternatives.
For effective decision making, a person must be able to forecast the outcome of
each option as well, and based on all these items, determine which option is
the best for that particular situation.
People often find it hard to make decisions -
inevitably we all have to make decisions all the time, some are more important
than others.
Some people put off making decisions by
endlessly searching for more information or getting other people to offer their
recommendations. Others resort to decision making by taking a vote,
sticking a pin in a list or tossing a coin.
Regardless of the effort that is put into making
a decision, it has to be accepted that some decisions will not be the best
possible choice. This page examines one technique that can be used for
effective decision making and that should help you to make effective decisions
now and in the future.
Although the following technique is designed for
an organisational or group structure, it can be easily adapted to an individual
level.
What is Decision Making?
In its simplest sense: 'Decision Making is
the act of choosing between two or more courses of action'. However,
it must always be remembered that there may not always be a 'correct' decision
among the available choices.
There may have been a better choice that had not
been considered, or the right information may not have been available at the
time. Because of this, it is important to keep a record of all important
decisions and the reasons why these decisions were made, so that improvements
can be made in the future. This also provides justification for any
decision taken when something goes wrong.
Hindsight might not be able to correct past
mistakes, but it will aid improved decision making in the future.
Effective Decision
Making
Although decisions can
be made using either intuition or reasoning, a combination of both approaches
is often used. Whatever approach is used, it is usually helpful to
structure decision making in order to:
·
Reduce more complicated
decisions down to simpler steps.
·
See how any decisions
are arrived at.
·
Plan decision making to
meet deadlines.
Stages of Decision Making
Many different techniques of decision making
have been developed, ranging from simple rules of thumb, to extremely complex
procedures. The method used depends on the nature of the decision to be
made and how complex it is.
The method described here follows seven stages:
1.
Listing
all possible solutions/options.
2.
Setting
a time scale and deciding who is responsible for the decision.
3.
Information
gathering.
4.
Weighing
up the risks involved.
5.
Deciding
on values, or in other words what is important.
6.
Weighing
up the pros and cons of each course of action.
7.
Making
the decision.
1. Listing Possible Solutions/Options
In order to come up with a list of all the
possible solutions and/or options available it is usually appropriate to work
on a group (or individual) problem-solving process. This process, could include
brainstorming or some other 'idea generating' process (see our page: Problem Solving for
more information).
This stage is important to the overall decision
making processes as a decision will be made from a selection of fixed
choices. Always remember to consider the possibility of not making a
decision or doing nothing and be aware that both options are actually potential
solutions in themselves.
2. Setting a Time Scale and Deciding Who is
Responsible for the Decision
In deciding how much time to make available for
the decision making process, it helps to consider the following:
·
How much time is
available to spend on this decision?
·
Is there a deadline for
making a decision and what are the consequences of missing this deadline?
·
Is there an advantage in
making a quick decision?
·
How important is it to
make a decision? How important is it that the decision is right?
·
Will spending more time
improve the quality of the decision?
Also see our page: Time Management.
Responsibility For The Decision
Before making a decision, it needs to be clear
who is going to take responsibility for the decision. Remember that it is not always those
making the decision who have to assume responsibility for it. Is it an
individual, a group or an organisation? This is a key question because
the degree to which responsibility for a decision is shared can greatly
influence how much risk people are willing to take.
If the decision making is for work then it is
helpful to consider the structure of the organisation that you are in. Is
the individual responsible for the decisions he or she makes or does the
organisation hold ultimate responsibility? Who has to carry out the
course of action decided? Who will it affect if something goes
wrong? Are you willing to take responsibility for a mistake?
Finally, you need to know who can actually make
the decision? When helping a
friend, colleague or client to reach a decision, in most circumstances the
final decision and responsibility will be taken by them. Whenever
possible, and if it is not obvious, it is better to make a formal decision as
to who is responsible for a decision. This idea of responsibility also
highlights the need to keep a record of how any decision was made, what
information it was based on and who was involved. Enough information
needs to be kept to justify that decision in the future so that, if something
does go wrong, it is possible to show that your decision was reasonable in the
circumstance and given the knowledge you held at the time.
3. Information Gathering
Before starting on the process of making a
decision, all relevant information needs to be gathered.
If there is inadequate or out-dated information
then it is more likely that a wrong decision might be made. Also, if
there is a lot of irrelevant information then the decision will be difficult to
make, it will be easier to become distracted by unnecessary factors.
There is a need for up-to-date, accurate
information on which to make decisions. Such information needs to be gathered so that a
well-informed decision can be made. The amount of time spent on
information gathering has to be weighed against how much you are willing to
risk making the wrong decision. In a group situation, such as at work, it
may be appropriate for different people to research different aspects of the
information required. For example different people might be allocated to
concentrate their research on costs, facilities, availability, and so on.
You may find the pages in our Study Skills section useful during
the information gathering stage of decision making. Our pages: Effective Reading and Note-Taking may
be of particular relevance.
4. Weighing up the Risks Involved
One key question is how much risk should be
taken in making the decision? Generally, the amount of risk an individual is
willing to take depends on:
·
The seriousness of the
consequences of taking the wrong decision.
·
The benefits of making
the right decision.
·
Not only how bad the
worst outcome might be, but also how likely that outcome is to happen.
It is also useful to consider what the risk of
the worst possible outcome occurring might be, and to decide if the risk is
acceptable. The choice can be between going 'all out for success' or
taking a safe decision.
5. Deciding on Values
Everybody has their own unique set of values -
what they believe to be important.
Many people decide to buy a car for themselves
but different people buy different cars based on their own personal
values. One person might feel that price is the most important feature,
whereas another person might be more concerned with its speed and
performance. Others might value safety, luggage space or the cars impact
on the environment or a combination of these features.
Depending on which values are considered
important, different opinions may seem more or less attractive. If the
responsibility for a decision is shared it is possible that one person might
not have the same values as the others. In such cases, it is important to
obtain a consensus as to which values are to be given the most weight. It
is important that the values on which a decision is made are understood because
they will have a strong influence on the final choice.
People do not make decisions based on just one
of their values. They will consider all their values which are relevant
to the decision and prioritise them in order of importance. If you were to buy
a car, what would be the five most important factors to you?
6. Weighing up the Pros and Cons
It is possible to evaluate the pros and cons of
each possible solution/option by considering the possible advantages and
disadvantages.
One aid to evaluating any solution/option is to
use a 'balance sheet', weighing up the pros and cons (benefits and costs)
associated with that solution. For example, a small business that regularly
hires vehicles from an external company might consider buying a vehicle for
their exclusive use.
Using the question: "Should we buy a
vehicle?" - the business could list the pros and cons of the purchase
in the following way:
Pros
|
Cons
|
Saving on hire charges
|
Cost of purchase
|
Would make it easier to organise staff travel
|
Potential driver(s) could require training
|
Will always be available
|
Insurance and maintenance costs
|
However, it may be useful to rate each of the pros and cons on a simple 1 to 10 scale (with 10 high - most important to 1 low - least important):
Having listed the pros and cons, it may be possible to immediately decide whether the option of buying a vehicle is viable.
Pros
|
Cons
|
||
Saving on hire charges
|
9
|
Cost of purchase
|
6
|
Would make it easier to organize staff travel
|
7
|
Potential drivers could require training
|
4
|
Will always be available
|
6
|
Insurance and maintenance costs
|
8
|
Total
|
22
|
Total
|
18
|
In this case the cons (disadvantages) have the
lower score while the pros (benefits) are higher and purchase of a car is
therefore a strong possible choice.
In scoring each of the pros and cons it helps to
take into account how important each item on the list is in meeting
values. For example, if the most important value was the potential
saving, then the fact that a particular car has high insurance and maintenance
costs will increase its score on the con side.
This balance sheet approach allows both the
information to be taken into account as well as the values, and presents them
in a clear and straight forward manner.
7. Making the Decision
There are many techniques that can be used to
help in reaching a decision. The pros and cons method (as above) is just
one way of evaluating each of the possible solutions/options available.
There are other techniques which allow for more
direct comparisons between possible solutions. These are more complicated
and generally involve a certain amount of calculation. These can be
particularly helpful when it is necessary to weigh up a number of conflicting
values and options.
For example, how would you decide between a
cheap to buy but expensive to run car and another more expensive car, that is
more economical to keep on the road?
Intuitive Judgements: In addition to making reasoned decisions
using the techniques shown above, in many cases people use an intuitive
approach to decision making. When making a decision many influences,
which have not been considered, may play a part. For example, prejudice
or wishful thinking might affect judgement. Reliance is often placed on
past experience without consideration of past mistakes. Making a decision
using intuition alone should be an option and not done merely because it is the
easy way out, or other methods are more difficult.
Intuition is a perfectly acceptable means of
making a decision, although it is generally more appropriate when the decision
is of a simple nature or needs to be made quickly. More complicated
decisions tend to require a more formal, structured approach. It is
important to be wary of impulsive reactions to a situation and remember to keep
a record of the decision for future reference, no matter whether the decision
was made intuitively or after taking a reasoned approach.
If possible, it is best to allow time to reflect
on a decision once it has been reached. It is preferable to sleep on it
before announcing it to others. Once a decision is made public, it is
very difficult to change.
Summary
Decision making is the act of choosing between a
number of alternatives. In the wider process of problem solving, decision
making involves choosing between possible solutions to a problem.
Decisions can be made through either an intuitive or reasoned process, or a
combination of the two. There are usually a number of stages to any
structured decision making.
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