Decision-making, in brief, is selecting a course of action from alternatives. In actual practice, decision-making should be thought of as a process which includes five steps:
- Define the problem. Few problems are really clear cut, and usually the symptoms are more apparent than the causes. Symptoms offer valuable clues to underlying problems, but until you have identified the real problem, or problems, you’re not ready for Step 2.
- Gather the facts and data. Decision-making requires that you gather all the data that might have a bearing on the problem. For the most part, data will consist of facts, opinions and assumptions obtained from observations, records, or other people. If key information is not available, delay your decision until you get it. In some cases, however, decisions have to be made on the basis of incomplete knowledge, either because the information is not obtainable or because it would be too costly to get.
- Organize the information. If you are working with many facts or a mass of data, you’ll have to sort out the important from the trivia, and organize the information so it can be compared and analysed. As you study what’s available you should look for relationships among the various factors–costs, growth, schedules, advantages and disadvantages, etc.
- Develop options. This is the guts of the decision-making process: developing as many good options as possible. Quality and quantity are equally important. It is rare for a problem to have only one solution, so don’t be deceived. The important thing is to keep an open mind, let your imagination roam freely over the facts you’ve collected, and jot down the possible solutions that occur to you.
- Analyze the alternatives and make your decision. With the previous groundwork laid, you are now in a position to compare the alternatives and determine the best solution. Test the alternatives against specific, good criteria–risk involved, permanency of the remedy, timing, practicability, your objectives, and so on. Sometimes you can quickly eliminate the unacceptable options and focus on a few alternatives with less shortcomings. Ultimately, you will arrive at the “best” decision.
DECISION is built around the last four steps in this process. In other words, the problem, or underlying problems, have been defined for you.