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Imagine you have to make a decision on whether to bid for a high-value project. The catch? The deadline is today.
You know the project could be a game-changer for your business.
Everything is perfectly aligned, but you spend time analyzing the project, pondering over its feasibility, and realizing that you are unable to make a decision.
In the end, the decision gets made for you—you miss the deadline and let a potentially great opportunity slip away.
Importance of Decision-Making
Decision-making is a multifaceted process that is embedded in everything we do. We make various types of decisions in personal and professional matters.
It is our decision-making skills that have a direct bearing on the results of our efforts.
All these decisions are linked to our personal happiness, success or the lack of it.
Our decision-making techniques become even more crucial in the professional domain because they can impact our colleagues as well.
Let’s look at an example. Rohit runs an event management company and his business is doing well. But he wants to do much better.
At the end of the year, his company beats its revenue target and his employees are jubilant. They expect a good bonus.
But instead of giving them a raise, Rohit doubles the targets for the year ahead and offers only a small incentive to a few employees.
Disheartened, many leave in the weeks that follow. Rohit fails to hire replacements quickly, and, as a result, loses several clients owing to lack of manpower.
Decision-Making Process
Decision-making in the business world is not an impulsive act. There are times when you need to take quick decisions, and others when you need to patiently spend time on due diligence before making a choice. However, there are always structured decision-making techniques that are used by us all. Several factors affect our business decisions.
For instance, the biggest guiding factor is whether the decision will generate value for the business. It could be in the form of goodwill, lead generation or actual sales, but it has to drive the business forward.
Keeping in mind the importance of decision-making, here is a list of steps of decision-making:
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Identification:
You will be able to take the right decision only if you identify the need and the problem accurately.
Let’s say you need to decide on whether to install a new automatic machine that will double your business’s installed production capacity. Before taking the decision, you need to contemplate many variables, such as the demand-supply gap, cost of capital purchases, training for the workforce and so on.
The idea is to identify whether the decision that you need to take is needed or not. Various decision-making techniques can help you identify the decision accurately.
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Learn more:
Sometimes, there is not enough information, and just because something appears to be lucrative, one might be tempted to jump onto it. Hasty decision-making is usually not a good idea for the business. Find whatever information is available; assess the value of your decision, sustainability and long-term cost. An ideal decision-making process is never hasty.
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Look for alternatives:
People with good decision-making skills don’t believe that there is only one right way to do things. Go ahead and explore the alternatives.
Let’s say you see a massive traffic jam on your usual route to work on Google Maps. Would you still go down the same road and lose precious time? Or would you look for an alternative route? Similarly, in other aspects of your life, too, explore all options and look for the one that gives the best results.
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Analyze the data:
Successful decision-making techniques are highly analytical. You must always evaluate the pros and cons of any decision. If needed, review the options, predict the scenarios and analyze how each option is likely to play out in different situations.
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Make the decision:
The culmination of a decision-making process is making the decision. After you have gone through the above steps, it is time to take a well-thought-out decision. Your decision-making skills will give you ample understanding of the most beneficial choice, and once you have identified it, go ahead and make the choice. The importance of decision-making lies in the timing as well—you wouldn’t want to waste any unnecessary time on the decision-making process.
Conclusion
Good decision-making techniques help you inculcate the decision-making process and enhance your decision-making skills. Harappa Education has created a specific course to boost your decision-making skills. This Making Decisions course has a section that focuses on multi-step decision-making techniques that empower the users to make smart decisions. It is an easy online course that can be incredibly beneficial in making you a better decision-maker.
Explore topics such as the Importance of Decision Making, Decision Making Methods, How to Make Decisions & Problem Solving and Decision Making at Workplace from our Harappa Diaries blog section and develop your skills.
