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If you’re considering whether to study abroad today, you’ll assess the risks involved in the context of COVID-19. Your decision will depend on factors like travel permits, quarantine requirements and accommodation. The job market isn’t exactly ideal, so you also need to consider prospects.
Decision-making depends on several factors that are not in our control. These include uncertainties that can affect our plan of action. When you invest your money, for instance, you evaluate the risk in terms of a return on investment.
If your investment approach is conservative, you might choose to put your money in tried and tested mutual funds. If you have a greater appetite for risk and are ready to face any downside, you may decide to trade in equities directly.
No informed decision is ever based on 100% accuracy or certainty. Every day you choose something over another. In a business setting, this is even more important because a lot is riding on the decisions made. Many livelihoods—including your own—depend on it so you have to consider several factors before you can make an informed decision.
Let’s explore the meaning and definition of informed decision making as well as ways in which you can make an informed decision to reach a favorable outcome for everyone involved.
Informed Decision Meaning And Definition
The meaning of informed decision making is assessing risks and collecting relevant information before you take a step. An informed decision focuses on the risks and benefits involved in the decision-making process.
Let’s say that you’re looking for a new office space for your start-up. Some of the factors you should consider include location, accessibility, size and viability. For instance, if it’s a delivery-based business, then you need sufficient storage space for your products. After considering each of these factors, you’ll choose the place that satisfies most—if not all—of these conditions.
How To Make An Informed Decision
A well-informed decision requires patience, objective thinking, accounting for unpredictability, and preparing for failures. It is a natural tendency to believe that the world is more predictable than it is. Harappa Education’s Making Decisions course will teach you how to plan for uncertainties by making an informed decision. Here are some key steps to help streamline the decision-making process:
1. Develop A Mindset For Uncertainties
The first step in the decision-making process is to acknowledge uncertainties. For example, you accept that there is a possibility that your vehicle might be involved in a road accident despite your superior driving skills.
So you go ahead and ensure that your car is fitted with airbags of the best possible quality. Knowing that the plan is not foolproof and that there may be setbacks is half the battle won. The right mindset will help you tackle setbacks or failures. If the plan is unsuccessful, you’ll be strong enough to treat it as a learning opportunity.
2. Gather Substantial Information
Our Making Decisions course will teach you about one of the most important tools to tackle uncertainties: the Best-Guess Hypothesis. This is where you make a guess based on all the information you have gathered. It’s a critical step in the decision-making process because you determine which theories need to be tested as part of your plan. The Best-Guess Hypothesis is especially useful in situations where there’s little data to go by.
3. Assess The Conditions
Conditions determine the outcome of an informed decision. A simple question you can ask yourself is: “Which conditions need to be met for my hypothesis to be true?” Conditions are the parameters that affect outcomes. They’re also the metric against which you can measure your progress.
4. Implementation Of The Decision
Once you’ve evaluated the uncertainties, gathered all the information you need and identified your conditions, you can begin implementing your decision. It’s only when you apply the decision in real life that you can assess whether it has set you back or moved you forward.
It may work out as expected or you may be faced with unexpected challenges, like changed market conditions. If your decision doesn’t play out the way you’d have liked it to, you can always learn from it and do better next time.
5. Take Ownership Of Your Decisions
Making an informed decision requires hard work and patience. Have faith in your abilities and trust your judgment. You’ve considered everything carefully before making a decision and reminding yourself of your effort can be truly uplifting. Rather than worrying about the outcome, try to focus on perfecting each step in the process.
Decision-making is a critical skill in the workplace, particularly in situations where you are short on time and a lot is at stake. Developing a habit of evaluating your options and acknowledging risks will help you make sound decisions. Harappa Education’s Making Decisions course will teach you important concepts like the Best-Guess Hypothesis. You’ll learn how to overcome obstacles, accommodate different perspectives and sharpen your decision-making ability.
Explore topics such as Importance of Decision Making, Process of Strategic Decision Making, Strategic Decision Making & How to Make Good Judgements from our Harappa Diaries blog section and develop your skills.
