Decision-Making Process | Decision-Making Process in Different Functions

What is Decision Making?

Modern management relies heavily on decision-making. In fact, the primary function of management is to make sound or logical decisions. Each manager makes hundreds of decisions, knowingly or unknowingly, making them an integral part of the manager's position. Decisions are important because they govern both organizational and administrative work. The decision is a course of action chosen from a set of options for the purpose of achieving the goals or objectives of an organization or administration. The decision-making process is an ongoing and important part of managing any business or organization. Decisions are made to keep all business activities and organization activities running smoothly.


To ensure that organizational or commercial goals are met, decisions are made at all levels of government. In addition, decisions are one of the most important operational values ​​that an entire organization adopts and uses to achieve full growth and advancement in terms of services and/or products provided.

As a result, the subsequent definitions can be used to higher illustrate the decision-making process.

Definition of Decision Making

The Oxford Advanced Learner's Dictionary defines selection making as "the manner of selecting about whatever essential, specifically in a set of people or in an agency," according to the Oxford Advanced Learner's Dictionary.

"Decision-making" is defined by Trewatha and Newport as "the choice of an application between two or more possible ways to reach a solution to a particular problem."

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As the foregoing explanations show, decision-making is the process of consulting a team of experts to improve the performance of any business. As a result, it is an ongoing and dynamic task that pervades all other organizational activities. The decision-making process is crucial to the success of the organization because it is an ongoing process. Because intelligent minds are involved in the decision-making process, sound scientific knowledge, skills, and experience, as well as mental maturity, are required.

In addition, the decision-making process can be viewed as a check and balance system that ensures a straight and linear growth of the organization. It means that the decision-making process is aimed at a specific outcome. Objectives are pre-determined business objectives, company objectives, and organizational vision. To attain these objectives, the organization may encounter numerous challenges in the administrative, operational, marketing, and operational sectors. Such issues are resolved by a decision-making process. No decision is complete in itself, as new difficulties may arise. Whilst one trouble is treated, every other aris, and so forth, so that, as previously said, the decision-making system is non-stop and dynamic.

When decisions are made, a lot of time is spent. In a management setting, decisions cannot be made hastily. It should take the following steps:

  1. Identifying the issue
  2. Information gathering and data collection
  3. Options are being developed and weighed.
  4. Choosing the greatest option available
  5. Plan and carry out your strategy.
  6. Take action to follow up.

Because the decision-making process follows a series of aforementioned processes, it takes a long time. This is true of all decisions made in a company policy to deal with management and administrative matters. Although the whole process takes time, the end result is a professional company is very good.

What is Decision Making Process?


Everyone has to make decisions every day. There are no exceptions to this rule. When it comes to corporate organizations, making decisions is both a habit and a process.

Successful and efficient decisions lead to corporate profits, while ineffective and unsuccessful decisions lead to losses. As a result, the most important process in any business is corporate decision-making.

We choose one course of action from a few options during the decision-making process. Many tools, strategies, and views may be used in the decision-making process.

Furthermore, we have the option of making our own individual decisions or opting for a group decision.

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Making decisions is usually difficult. The majority of business decisions entail some level of unhappiness or disagreement with a third party.

Let's take a look at the steps of Decision Making Process.

Steps of Decision Making Process

The steps of the decision-making process are outlined below. Different tools and strategies may be used to support each step.


Step 1: Determine why the choice is being made.

The problem is thoroughly examined in this step. When it comes to determining the decision's purpose, there are a few questions to consider.

  • What exactly is the issue?
  • Why should the issue be resolved?
  • Who are the people who are affected by the problem?
  • Is there a time limit or a deadline for the problem?

Step 2: Gathering information

Many people will be affected by an organization's problem. Furthermore, the situation may be influenced by a slew of other circumstances.

In order to solve the problem, you'll need to acquire as much information as possible about the factors and stakeholders involved. Tools like 'Check Sheets' can be quite useful in the information collection process.

Step 3: Judging the choices based on the principles.

The baseline criteria for judging the options should be established in this step. When it comes to creating the criteria, it's important to consider both business goals and corporate culture.

Profit is one of the most important considerations in any decision-making process. Unless there is an extraordinary circumstance, companies rarely make actions that have lower profitability. Similarly, baseline concepts relevant to the topic at hand should be determined.

Step 4: Create a list of options and analyze them.

The greatest option for this step is to use brainstorming to write down all of your thoughts. Understanding the reasons for the problem and prioritizing the causes is critical before moving on to the idea-generating stage.

Then you can proceed to brainstorm all conceivable solutions (alternatives) to the problem at hand.

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Step 5: Alternatives are assessed

To analyze each option, apply your judgment principles and decision-making criteria. Experience and the effectiveness of the judgment principles are used in this step. You should weigh the pros and cons of each option.

Step 6: Decide on the best option.

This step is simple once you've completed Steps 1 through 5. Furthermore, because you have already followed a methodology to derive and select the greatest alternative, choosing the best alternative is a well-informed decision.

Step 7: Put your plan into action.

Convert your decision into a strategy or a set of steps. Execute your strategy on your own or with the assistance of subordinates.

Step 8: Assess the outcomes

Examine the result of your decision. Check to see if there's anything you should learn and correct in your decision-making in the future. This is one of the most effective methods for enhancing your decision-making abilities.

Decision Making in Different Functions

Management's primary responsibility at work is to make decisions on corporate operations and expansion. We see plenty of decision-making skills examples in everyday operations, whether it's managing the workforce, servicing clients, scaling up production, or employing new staff.

Let's look at some management decision-making examples to better appreciate the relevance of decision-making:

Decision Making in Human Resources

Assume you're the CEO of a new e-commerce company. Your company is growing, and you'll need to hire the proper people to assist you to achieve your goal of building a leading online retail platform.

You'll need to hire personnel with experience and expertise in software development, marketing, operations, procurement, and logistics, among other industries.

You won't need to engage staff who only work on the premises because the company is an internet start-up and you can also hire talented location-independent professionals who can provide the necessary technical assistance and services via the internet.

You may easily carry out the activities in a cost-effective manner by assuring an ideal mix of on-site and remote staff. Team spirit can be maintained through email and chat communications, as well as video interactions. This will also allow you to hire individuals from all over the world who can collaborate digitally to produce ground-breaking solutions.

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Decision Making in Production

Deciding on production facilities is one of the most common examples of management decisions. As your company grows and demand increases, you will need to increase your production capacity. The next step will be to determine how much volume should be added to meet the need accordingly. You'll also need to figure out what kind of equipment you'll need and who will manage the production lines.

Your decision should be influenced by the fact that the ultimate goal is to grow output in a sustainable manner so that you can scale up or down without incurring a significant cost.

Decision Making in Marketing

Most businesses undergo rebranding at some point during their existence. Businesses are typically tiny at first, with only local or regional reach and branding, but as they grow, the need for rebranding emerges.

To emphasize a fresh identity, capacity, and vision, logos, official mascots, and even names are frequently modified. Rebranding activities are good examples of decision-making abilities since they consider firm values, goods, target audiences, cultural and social sensibility, and commercial goals.

Decision Making in Client Servicing

When a company is just getting started, the goal is to get as many projects and clients as possible. The common idea is that the more work you get, the more money you make. However, you can see from numerous examples of decision-making skills that this strategy is not optimum in the long run.

For example, you might realize that you're wasting too much time and resources on an old client who isn't bringing in enough revenue to justify such a large investment. That client could have been one of your first and could have played a key role in the early stages of your company's development. It is important, however, to keep up with the times. Once you've progressed past a certain point, the client or project that worked, in the beginning, may no longer be viable. As a result, difficult decisions have to be made from time to time.

Such scenarios are typical in decision-making.


We just went over some typical decision-making and problem-solving scenarios that most people encounter in their working careers. In the course of our careers, we may be required to make more complicated decisions. Individual decisions, such as employing or firing an employee, or organizational decisions, such as opening a new office, are examples of this.

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