Procedure/steps of decision making

Decision Making

There are 3 types of decision making

a) Decision under Certainty

b) Decision under Risk

c) Decision under Uncertainty

Procedure/steps of decision making

The decision making is carried out under risk and uncertainties situation. It is a dynamic and intellectual process where a decision make should conduct different activities in a sequential manner the steps of decision making can be regarded as the guideline of decision making process. Major steps of decision making are:

Step 1 è Statement of problem or Identification/Recognize the Decision situation

Step 2 è Identification of Various/Different Alternatives or options

Step 3 è Analysis of each and every alternative

Step 4 è Selection of Best and most appropriate alternatives

Step 5 è Implementation of Selected Alternatives

Step 6 è Evaluation of Resauts and follow up

Step 1: Statement of problem or Identification/Recognize the Decision situation

The first step of decision making is identification of reorganization of the decision situation which means we should know the actual problems to which we are searching.

Step 2: Identification of Various/Different Alternatives or options

After knowing the decision situation or defining statement of the problems the decision maker should be able to identify different alternatives or options of solution. Such options should be related with the problems. Identification of maximum numbers of alternatives can give better solution.

Step 3: Analysis of each and every alternative

In these steps we should evaluate properly about the advantages, cost, timing, efforts, limitation etc of each alternatives. If any components or measurement of the components are unsuitable for our organization than we avoided such alternatives and go for another. The process of evaluating and alternative may be

Step 4: Selection of Best and most appropriate alternatives

After the evaluation of various aspects of each alternatives, the decision maker based on his skill, knowledge, experience and analyzed information should select most appropriate and best alternatives among the alternatives.

Step 5: Implementation of Selected Alternatives

The selected alternatives should be implemented properly as for the procedure of implementation as directed by the decision making proper and effective communication should be made to the implementers for right and proper implementation.

Step 6:  Evaluation of Sautes and follow up

The results or impacts of implemented decision should be analyzed properly such evaluation may be on regular basis or periodic basis. Proper evaluation of decisions can also evaluate the performance of managers. If any deviation are found from the standards or predetermined procedures, necessary corrective actions should be applied immediately.