How Good Is Your

Decision Making?

…with ERNIE C. CERADO

 What is decision-making?
In psychology, decision-making is regarded as the
cognitive process resulting in the selection of a
belief or a course of action among several possible
alternative options. It could be either rational or
irrational.

• In management, decision making can be defined

as selecting between alternative courses of
action.
https://thebusinessprofessor.com/en_US/research-analysis-decision-science/management-and-decision-making
 In the wider process of problem-solving, decision-
making involves choosing between possible solutions to
a problem.

• Solution 1?
Problem • Solution 2?
• Solution 3?
 Decision-making is the most important
component of a manager's activities. It
plays the most important role in the
planning process.

• When the managers plan, they decide on

many matters as what goals their organisation
will pursue, what resources they will use, and
who will perform each required task.

https://www.yourarticlelibrary.com/management/decision-making-management/decision-
making-definition-importance-and-principles-management/70038
• Decision-making is a key
skill in the workplace, and
is particularly important if
you want to be an
effective leader.
• Whether you're deciding which
person to hire, teacher to teach,
faculty to hold the subject, Dean to
administer the college, Director to
head a division, supplier to consider,
or which career or strategy to pursue,
the ability to make a good decision
with available information is vital.
 “What is urgent is seldom
important, and what is
important is seldom urgent.”

D. Eisenhower
34th US President
• It would be easy if
there was one • It would be easy if there is
formula you could one formula you could use
use in any situation, in any situation, but there
but there is NOT. is NOT.

• Each decision • Each decision presents its

presents its own own challenges, and we all
challenges, and we have DIFFERENT WAYS of
all have DIFFERENT approaching problems.
WAYS of approaching
problems.
So, how do you avoid making bad
decisions – or leaving decisions to
chance?
• So, how do you avoid making
bad decisions – or leaving
decisions to chance?

• You need a systematic

approach to decision making
so that, no matter what type of
decision you have to make, you
can take it with confidence.
No one can afford to make
poor decisions.
No one can afford to make poor
decisions.

• We have here a SHORT QUIZ to help

you assess your current decision-
making skills.
• Let’s examine how well you structure your
decision-making process.

• Get a piece of paper where you can write

your ANSWERS.
Now, let’s BEGIN!
How Good Are Your
Decision-Making
Skills?
Your time starts
NOW…
 What’s the result?

So, what’s your SCORE?

What does it mean?

Let’s interpret your score.
Interpretation…
Score Comment
Your decision-making hasn't fully matured. You aren't
18-42
objective enough, and you rely too much on luck,
instinct or timing to make reliable decisions.

Start to improve your decision-making skills by

focusing more on the process that leads to the
decision, rather than on the decision itself. With a
solid process, you can face any decision with
confidence.
Interpretation…
Score Comment
Your decision-making process is OK. You have a good
43-66 understanding of the basics, but now you need to
improve your process and be more proactive.
Concentrate on finding lots of options and discovering
as many risks and consequences as you can.

The better your analysis, the better your decision will

be in the long term. Focus specifically on the areas
where you lost points, and develop a system that will
work for you across a wide variety of situations.
Interpretation…
Score Comment
You have an excellent approach to decision-making!
67-90 You know how to set up the process and generate lots
of potential solutions. From there, you analyze the
options carefully, and you make the best decisions
possible based on what you know.

As you gain more and more experience, use that

information to evaluate your decisions, and continue
to build on your decision-making success. Think
about the areas where you lost points, and decide
how you can include those areas in your process.
• As you answered the
questions, did you see
some common themes?
Basically, we based the quiz
on six essential steps in the
decision-making process.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
2. Generating potential solutions.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
2. Generating potential solutions.
3. Evaluating the solutions.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
2. Generating potential solutions.
3. Evaluating the solutions.
4. Deciding.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
2. Generating potential solutions.
3. Evaluating the solutions.
4. Deciding.
5. Checking the decision.
Six steps in decision-making

1. Establishing a positive decision-making

environment.
2. Generating potential solutions.
3. Evaluating the solutions.
4. Deciding.
5. Checking the decision.
6. Communicating and implementing.
Establishing a positive decision-making
environment. • If you're aware of
Generating potential solutions.
these six basic
elements and improve
Evaluating the solutions. the way you structure
them, this will help you
Deciding. develop a better
overall decision-
Checking the decision.
making system.
Communicating and implementing.

• Let's look at the six

elements individually.
 1
Establishing a Positive Decision-Making Environment

I try to determine the real issue • If you've ever been in a

before starting a decision-making
process. (3) meeting where people
seem to be discussing
I use a well-defined process to
structure my decisions. (7)
different issues, then
you've seen what
happens when the
In a group decision-making
process, I tend to support my decision-making
friends' proposals and try to find
ways to make them work. (13) environment hasn't been
I prefer to make decisions on my established.
own, and then let other people
know what I've decided. (16)
 1
Establishing a Positive Decision-Making Environment

I try to determine the real issue • It's thus important for

before starting a decision-making
process. (3) everyone to understand
the issue before preparing
I use a well-defined process to
structure my decisions. (7)
to make a decision.

In a group decision-making
process, I tend to support my
friends' proposals and try to find
ways to make them work. (13)

I prefer to make decisions on my

own, and then let other people
know what I've decided. (16)
 1
Establishing a Positive Decision-Making Environment

I try to determine the real issue • This includes agreeing on

before starting a decision-making
process. (3) an objective, making sure
the right issue is being
I use a well-defined process to
structure my decisions. (7)
discussed, and agreeing
on a process to move the
decision forward.
In a group decision-making
process, I tend to support my
friends' proposals and try to find
ways to make them work. (13)

I prefer to make decisions on my

own, and then let other people
know what I've decided. (16)
 1
Establishing a Positive Decision-Making Environment

I try to determine the real issue

before starting a decision-making
• You also must address
process. (3) key interpersonal
I use a well-defined process to considerations at the
structure my decisions. (7)
very beginning. Have you
In a group decision-making
included all the
process, I tend to support my
friends' proposals and try to find
stakeholders?
ways to make them work. (13)

I prefer to make decisions on my

own, and then let other people
know what I've decided. (16)
 1
Establishing a Positive Decision-Making Environment

I try to determine the real issue

before starting a decision-making
• And do the people involved
process. (3) in the decision agree to
respect one another and
I use a well-defined process to
structure my decisions. (7) engage in an open and
honest discussion? After all,
In a group decision-making if only the strongest opinions
process, I tend to support my
friends' proposals and try to find are heard, you risk not
ways to make them work. (13)
considering some of the best
I prefer to make decisions on my
own, and then let other people
solutions available.
know what I've decided. (16)
 Generating
2 Potential Solutions
I rely on my own
experience to find • Another important part of
potential solutions to a a good decision process is
problem. (4)
generating as many good
I think that involving alternatives as sensibly
many stakeholders to
generate solutions can
possible to consider. If you
make the process more simply adopt the first
complicated than it needs
to be. (8) solution you encounter,
then you're probably
I consider a variety of
potential solutions before missing a great many even
I make my decision. (11) better alternatives.
 Evaluating
3 Alternatives
I evaluate the risks • The stage of exploring
associated with each
alternative before making alternatives is often the most
a decision. (1) time-consuming part of the
decision-making process.
I am sometimes surprised
by the actual
This stage sometimes takes
consequences of my so long that a decision is
decisions. (6) never made!
Some of the options I've
chosen have been much To make this step efficient, be clear
more difficult to about the factors you want to
implement than I had
expected. (15) include in your analysis.
There are 3 key factors to consider in
evaluating alternatives

Risk

Consequences

Feasibility
3 key factors to consider in evaluating alternatives…

Risk – Most decisions involve

some risk. However, you need
to uncover and understand the
risks to make the best choice
possible.
3 key factors to consider in evaluating alternatives…

Consequences – You can't

predict the implications of a
decision with 100% accuracy.
But you can be careful and
systematic in the way that you
identify and evaluate possible
consequences.
3 key factors to consider in evaluating alternatives…

Feasibility – Is the choice realistic

and implementable? This factor is
often ignored. You usually have to
consider certain constraints when
making a decision. As part of this
evaluation stage, ensure that the
alternative you've selected is
significantly better than the status
quo.
 Deciding
4
I tend to have a strong • Making the decision itself
"gut instinct" about
problems, and I rely on it can be exciting and
in decision-making. (5) stressful. To help you deal
with these emotions as
I take the time needed to
choose the best decision- objectively as possible, use
making tool for each a structured approached to
specific decision. (10)
the decision. This means
taking a look at what's
I consider a variety of most important in a good
potential solutions before
I make my decision. (11) decision.
 Deciding
4
I tend to have a strong • Take the time to think ahead
"gut instinct" about
problems, and I rely on it and determine exactly what
in decision-making. (5) will make the decision “right.”
This will significantly improve
I take the time needed to
choose the best decision- your decision accuracy.
making tool for each
specific decision. (10)

I consider a variety of
potential solutions before
I make my decision. (11)
 Checking
5 the Decision
After I make a decision, • Remember that some things
it's final – because I know about a decision are not
my process is strong. (2)
objective. The decision has to
make sense on an intuitive,
instinctive level as well. The entire
process we have discussed so far
If I have doubts about my has been based on the
decision, I go back and perspectives and experiences of
recheck my assumptions
and my process. (9) all the people involved.

Now it's time to check the alternative you've

chosen for validity and "making sense.“
 Checking
5 the Decision
After I make a decision,
it's final – because I know • If the decision is a significant
my process is strong. (2)
one, it's also worth auditing it
to make sure that your
assumptions are correct, and
that the logical structure
If I have doubts about my
decision, I go back and you've used to make the
recheck my assumptions decision is sound.
and my process. (9)
 6
Communicating and Implementing
Before I communicate my
decision, I create an • The last stage in the decision-making
implementation plan. (12) process involves communicating your
choice and preparing to implement it.
You can try to force your decision on
When communicating my
decision, I include my
others by demanding their acceptance.
rationale and justification. Or you can gain their acceptance by
(14) explaining how and why you reached
your decision.
I emphasize how
confident I am in my For most decisions, it's more effective
decision as a way to gain
support for my plans. (18)
to gather support by explaining its
details.
 6
Communicating and Implementing
Before I communicate my
decision, I create an • Have a plan for implementing
implementation plan. (12)
your decision.
When communicating my
decision, I include my
rationale and justification.
(14)

I emphasize how
confident I am in my
decision as a way to gain
support for my plans. (18)
Key Points

Decision making is a skill –

and skills can usually be Use this opportunity to
improved. think about how you can
improve your decision
making and take your skills
to the next level.
Key Points

Decision making is a skill –

and skills can usually be
improved.

Asyou
As yougain
gain more experience in making decisions,
more
and as youmaking
experience become more familiar with the tools
decisions, and as you
and structures needed forUse
effective decision to
become more familiar with this opportunity
making,
the you'll
tools and improve your
structures confidence.
think about how you can
needed for effective improve your decision
decision making, you'll making and take your skills
Key Points

Use this opportunity to

think about how you can
improve your decision
making and take your skills
to the next level.
Ultimately, improving your
decision-making skills will
Ultimately,benefit
improving
you andyour
your
decision-making skills will benefit
organization.
you and your organization.
Again, the six steps in decision making are:
Establishing a positive decision-making environment.

Generating potential solutions.

Evaluating the solutions.

Deciding.

Checking the decision.

Communicating and implementing.

Concluding…

• Decision making is a critical skill for effective

management and leadership. Some people are
just not suited to leadership roles because of
their lack of ability to make decisions. This can
assist you in streamlining many typical
decisions to be made in life.
• No human activity can evade decision making.
It is very crucial to the functioning of an
organisation or any life for that matter. The
possibilities of attainment of organisational
goals and objectives depend on the sole act of
decision making. It is the pathway to the
future.
Thank you for listening.