In this video, we're going to talk about different ways to make decisions, and how to make better decisions regardless of which process you follow. Decision-making is the process of selecting force of action from several possible options. It is an essential part of the problem solving process, because a decision is always needed to choose the problem solution. Decisions should ideally be made systematically, but that isn't always possible. Sometimes a quick decision is crucial. A good decision executed swiftly is better than a perfect decision that is too late. Decisions affecting the future are often imperfect, because you can never avoid a certain degree of uncertainty. Supervisors need to have the nerve to act in spite of that. Otherwise, they'll suffer from paralysis by analysis, which is the tendency to avoid making decision due to the fear it will not be perfect. The rational decision-making model uses objective data, logic, and analysis to solve a problem or achieve a goal. For that reason, it is very similar to systematic problem solving. It's a step-by-step model for identifying a problem, picking a solution from multiple alternatives, and making a choice. Rational decision-making is an important skill to posses. The use of objective data sharpens our view and minimizes the effects of intuition and subjectivity, as well as our own biases and beliefs. Another way to make decisions is the intuitive approach, which is very different from rational decision-making. Intuition is our ability to understand something immediately with no conscious reasoning required. This is often called having a gut feeling or trusting your gut. Intuition is often used to supplement a rational problem-solving, because it helps to generate potential solutions. Sometimes the intuitive approach is required because there isn't enough information available and something has to be done, or a decision just feels right. An example might be making a final choice of a marketing campaign, despite not having a 100 percent confidence that your message will reach consumers. Decisions can be divided into two broad types, programmed and non-programmed. Programmed decisions are solutions to recurring problems that can be used every time the problem reappears. They require little to no consideration or discussion, and can be automated to ensure consistency and save time, effort and money. Solutions for programmed decisions come from policies and rules. Often they involve setting a minimum inventory level. An example is automatically placing a new order of 10 cases of paper, whenever only two cases are on hand. Non-programmed decisions solve novel or unique problems, and are usually used just once. There are no set procedures because the problem is new, complex, or complicated. There was a great deal of uncertainty, because cause effect relationships are unknown and there was no way to predict exactly what will happen, if a particular course of action is chosen. Creativity, intuition and a tolerance for ambiguity are required. An example would be a person deciding to buy their first car. It's a novel situation because they never bought one before, and then can't be certain whether they will be happy with their purchase in the long run. As in problem-solving, there's a time and place for group decision-making. Groups are capable of making higher-quality decisions than an individual might make, and can often develop innovative and creative solutions. On the other hand, group decision-making as the same pros and cons as group problem-solving. Higher quality decisions come at the cost of additional time and resources, and there is no guarantee that a group will always make the best decision. We suggest that group decision-making be used only when all of these factors are met. The group collectively has information, know-how, and viewpoints that you need and don't have. Members of the group are interested and want to participate, otherwise you'll just waste time and money. You have plenty of time. Groups don't make decisions quickly. You are open to the groups opinions and prepared to act on their suggestions.You sense their participation will make the group more committed to implementing the decision. People are almost always more satisfied with decisions they help to make and are more willing to follow them. You'll definitely want to avoid some common decision-making errors, like these. Borrowing solutions from others, or reusing old solutions that may not fit the current problem. Every situation is different and calls for unique solution to produce the best results. Satisficing, which is embracing a minimally acceptable solution, rather than trying for the best possible solution. It usually produces mediocre results. An example is buying the first used truck you test drive, rather than continuing to shop for one that suits your needs best. Neglecting to engage in critical thinking. Don't overdo it though. Remember, avoid paralysis by analysis, and keep in mind that the most creative solution is not automatically the best. Picking a solution first before doing all the needed analysis and then trying to justify it to yourself and others. Failing to consider intangibles like employee satisfaction and morale. Prioritizing results over everything else can backfire badly. Failing to have a backup approach in case the first strategy fails. Always have a backup plan. If you avoid these things, you have a great chance of being a good decision-maker.
