The decision-making process in business is the most important function of a manager. Whatever a manager does, he does through decision-making. Decision-making is arriving at the conclusion of whether to do certain things or not to do.
It is cutting of deliberations, which is also termed as that user activity is in the process of decision making one course of alternative is chosen from among the several courses of an alternative to arrive at decision.
A good and effective decision process has many types of decision-making features that are necessary for a business.
What are the 8 steps of the decision-making process?
Following steps of the decision-making process in a business organization:
1. Identification of Problem
The first step in the process of the decision-making process is the identification of the problem. Which exists in an organization.
So, There can a large number of problems in an organization but the most important among them would be the identification of the real problem troubling the organization.
2. Diagnosis of the Problem
The next step would be to diagnose the problem incorrect perspective.
It is not enough that the problem has been identified.
It is equally important that the problem is diagnosed from the correct perspective.
3. Collection of Information
The next step would be the correct information regarding the problem.
It would be collected from all sources, whether they are internal or external.
Thus, The step is collected with a view to knowing the problem in detail and understanding it thoroughly.
In a business organization, there are some powerful decision-making techniques that are adopted by many entrepreneurs.
4. Developing Alternative Solutions
The next phase is good to develop alternative courses of solutions. Here the role of creativity comes in.
The more the alternative is developed, the better the chances that effective decision-making shall be involved.
Generally, In the development of alternatives, efforts should be made to develop those alternatives which are not immediately Apparent.
There is seldom a problem for which reasonable solutions do not exist.
Thus, At the time of determining the alternative solutions, all those alternatives which come to mind should be listed.
It is possible that at times an alternative that is looking not so good is selected and comes out to be the best.
5. Evaluating Alternative Courses
Then comes the stage for the thorough evolution of the alternatives which were generated in the earlier stage.
In the process of evolution, the strong and weak points of each alternative solution should be probed.
The alternative should be evaluated in light of the objectives of the decision-making and goals of the organization.
That alternative is the good alternative that meets the organizational objective.
In this decision-making step, an attempt should be made to evaluate how is alternative contributes to the organizational objectives in the light of its resources and constraints.
Thus, An alternative that is good otherwise but is not in accordance with the spirit, philosophy, or constraint of the organization is not a good alternative.
The yardstick of ‘best’ comes on the basis of the objectives of the organization.
A good decision-making process depends on a good and ideal planning process for the business.
6. Selection of the Best Alternative
In this stage, an attempt was made to select the best alternative.
This is a point at which the solution is formally accepted and adopted.
It is the real point of the decision-making of the evolution of various alternatives the most workable and fit alternative is selected.
7. Implementing the Decision
The next step is to implement the decision.
It is no use of making a good decision. It is equally important decisions are implemented.
All enemies, money, resources, and other things shall go waste if the decision is not properly implemented.
Sometimes, the decision made is quite good but if it is not properly implemented, it does not bring the desired results.
The next step would be to get feedback as to how the decisions are bringing the results.
This can be known only from the feedback.
Thus, Feedback also reveals the drawbacks or good points of the decision, and in this manner as a manager improves their decision-making capacity and effectiveness in the times to come.
Thus, we find in the steps of the decision-making process in business a manager chooses and picks up on the best alternative out of several alternatives to come to a conclusion.