Decision-making process

economic-dictionary

The decision-making process is one in which a certain option is chosen from among the existing ones.

Making a decision is not an easy thing, and for this process to be carried out, it is necessary to have a series of options and to know as much as possible everything that each alternative entails.

That will help to know, or at least be closer to knowing what can happen if one option or another is chosen.

Decision-making processes are very common in any field. Both in the business environment and in everyday life it is necessary to do so.

A decision-making process involves a series of phases or stages in order to finally choose the most appropriate option for each case.

Phases of the decision-making process

These are the main ones:

  • The existence of a problem: If a decision has to be made, it is because there is a problem on which it is necessary to act. Therefore, it is necessary to identify this problem and reel it out to begin to know its magnitude, what it is about, what aspects it entails and how a person can face it.
  • The criteria that will be followed to make that decision: At the business level, guidelines should be established for this, to make the most appropriate decision. For example, some companies establish protocols to follow that are then used to make decisions. If you want to make an investment in advertising, a series of criteria, figures, market studies, among other aspects, are valued. If it is on an individual level, it is up to you to choose those options to finally make a concrete decision.
  • Prioritize criteria: This is something that must be done to rule out options. There will always be something that prevails over something else. For example, if you are going to buy a house, you have to establish a series of criteria, the size, the distance to work, if it has a patio, if it needs renovations, or the budget. Subsequently, these criteria have to be ordered in order to select and discard houses based on which ones are being viewed and which are more in line with those preferred criteria.
  • Analyze each of the alternatives: Faced with a problem, different solutions can be presented, and the ideal is to establish the positive and negative of them, the skills, strengths, and what can be achieved with each of them. They are usually value judgments, but sometimes there is objective data that gives us a lot of clarity.
  • Select an option: After having carried out the previous phases, a decision is made. It will be necessary to implement it, and later evaluate what is achieved with the implementation of this to know if it is correct, or else you have to make some type of modification to improve.

Tags:  finance comparisons USA 

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