Managerial Decision MakingIf you spend ten minutes at the grocery sorting through apples or deciding which carton of un-cracked eggs looks the best, then you are a very thorough decision maker but also one who struggles over actually making the decision. Decision making is a part of our daily lives and the fact of the matter is this: some of us are better at it than others.

If you pick out an imperfect apple, no big deal; but if you implement a marketing campaign that fails . . . well, that’s why this managerial decision making process exists to help you make the best possible decision every time. You can further build upon this strategy (and build confidence) with this effective leader’s guide to decision making.

1. Identify A Purpose

Identifying a purpose allows you to find something tangible to hold onto while you work through the rest of the process. Ask yourself: why does there need to be a decision? Presumably there is a problem or initiative that needs to be addressed, but what is it?

The idea is to ground yourself, as strongly as possible, to your purpose. As you move through the steps of gathering information and evaluating alternatives, you need to have something you can immediately reference for direction. Are we, in fact, heading in the right direction? Does this serve our ultimate purpose, or are we getting off track?

It is also considered wise, at this point, to understand who the decision will affect and how quickly the problem or initiative needs to be addressed. Therefore, you have arguably the three most important things nailed down:

  1. The need for the decision
  2. Who the decision will affect
  3. How quickly you must act

2. Preparation / Information

The sections following this one examine alternative decisions, which is why it is absolutely vital to gather as much information and to do as much preparation as possible before entering a serious discussion on actual decisions.

Obviously you can’t prepare courses of action yet, but you can gather information concerning the different variables at hand, the initial opinions and desires of others, relevant data, etc. These things will help you brainstorm the most ideal decisions and solutions. Think of it as adding detail to the “need” for a decision. You can further organize and prepare your findings with this Microsoft Excel Reports data preparation course.

3. Objectives

There is a good chance that this enters the discussion when you are identifying a purpose, but if not, now is the time to hammer out a few objectives. The decision may serve a purpose, but the purpose is likely to be multi-tiered.

For example, if you need to hire a new sales manager, then you also need to decide if you want to hire the person with the best track record for increasing profits, the person will the best interpersonal skills, etc. This will provide some much needed help with the next step. And if you are interested in profits, get some free advice from this post on financial modeling in Excel for profitable decision making.

4. Brainstorm Alternatives

In terms of making a decision that makes a difference, this is probably the most important part of the process. This is where you brainstorm all the options that are available to you. This is also the place where your expertise is tested. Can you generate good ideas? Well, can you? Because if you ultimately make a decision from the list you brainstorm, then the decision is only going to be as good as the effort and wit you put into brainstorming.

Some people like to start off with cause and effect diagrams or other organizational tools, but regardless of your methods, you should be primarily concerned with those ideas that are going to both serve a purpose and fulfill your objectives. But don’t get me wrong. Organizational tools serve an important purpose. If you’re looking for a new medium, check out this post on incremental analysis: a simple tool for powerful decision-making.

In terms of cause and effect: if the purpose is your “cause,” then your objectives are going to be the “effects” of that cause.

5. Analyze Your Alternatives

This should be fairly self-explanatory, but I still want to touch on a few ideas. The first is that there are an overwhelming number of decision making tools and strategies employed by high-ranking decision makers. These exist mostly to help you organize your thoughts and provide direction, but they simply do not possess the incredible intelligence of a human brain and subsequently should be treated as such. In other words, you have to analyze the alternatives yourself. No short-cuts.

Second, the best way to analyze something is to test it. This should remind you of the scientific method. If any of your alternatives are testable, then by all means, test them! Any time you can create a simulation of a plan, you give yourself a golden opportunity to see how your ideas will perform, minus the risk of a live launch.

6. Make A Decision

This was bound to happen: the preparation is over and it is time to make a decision. But the reason we performed steps 1-5 so meticulously (you did perform them meticulously, didn’t you?) is so that we are fully prepared to make a decision. In fact, the decision should be borderline obvious at this point.

Still, nobody would hold it against you if you decided to review. Start with step 1, re-calibrate your compass to point towards your purpose, then work your way back through all the information you gathered and objectives you decided upon and all the brainstorming and analyzing you subjected yourself to.

But if you still find yourself wavering at this point in the process, it might be time to invest in this strategic economic decision-making course based on proven theorems and beliefs.

7. Action!

Decisions tend to move pretty fast when you’re manager and this entire process might need to be performed in only a few days. The key here is to put your faith in your preparation and spring into action. Procrastinating is only going to keep you from the next part of the process (ironing out the wrinkles).

Eventually you are going to have to accept the fact that no decision is perfect. The modern business environment is too large and complex to expect regular perfection. No plan is going to be executed flawlessly. No amount of preparation can save you. That’s why it is so vital to throw the decision into action and begin work honing it to a truly effective business weapon.

8. Review And Revise

We all knew this was coming, but that doesn’t make it any easier. Everyone wants to implement a decision and move forward. Monitoring the results of the decision is, like I already said, at least as important as the decision itself. As no decision will be perfect from the get-go, it is essential to iron out the wrinkles.

This article by the World Trade Group even makes a defense for investing in business monitoring software. The benefits are simply indisputable. And really no decision should ever be left alone for too long. The business landscape changes fast, and checking in on campaigns and ideas is just a part of business life.

As your business grows and you have more and more decisions going into effect, you can see where business monitoring software could really save you a lot of time. If you decide to go that route (big decision, now), do it the right way with this five-star course on leveraging Oracle Business Intelligence Enterprise Edition (OBIEE).

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