INTRODUCTION

Making decisions is not something unfamiliar to us: we do it every day, it is

It is likely that by taking so many, some may seem automatic, so it is necessary to be careful.
special care with these. Good decisions are not easily achieved, they are the
result of a diligent organized mental process. The conditions change, so do not
We can expose ourselves to the risks of a mechanical response or an intuitive approach.
In fact, experiences for quick decisions can be so great that we
they can lead; without us realizing it, to a trap.

It is often said that decisions are something like the engine of business.
and indeed, the success of the appropriate selection of alternatives largely depends on
any organization. A decision can vary in significance and connotation.
decision-making has always been and will always be a fundamental part of key function
primordial of business organizations.

Decision-making is the main job of managers because they constantly

they have to decide what should be done, who should do it, when and where, and in
sometimes even how it will be done.

Many times we can make unconscious decisions, as we are affected and

influenced by external factors that prevent us from reflecting and making the
incorrect decision, unfounded. Decision-making goes beyond
choosing alternatives is not that simple. It is a whole process that involves analysis,
pondering and objectivity. Making good autonomous decisions includes accepting the
consequences and hold ourselves accountable for the actions we are taking.
 DECISION-MAKING PROCESS
DEFINITION
Decision making is the process by which a choice is made
among different options or possible ways to solve different situations
in life in different contexts: business, work, economic, family,
personal, social, etc. That is to say, decision-making consists of choosing a
option among those available, for the purpose of solving a current problem or
potential (even if a latent conflict is not evident).

In basic terms, "deciding" implies choosing the best option among the
possible. It is a process that begins with the identification of a problem,
during which it is necessary to analyze the alternatives, apply the most suitable one, and,
subsequently, analyze whether the planned objectives have been achieved or not.

It is common for companies to face the dilemma in their day to day of

having to make decisions. Taking the right path is essential, since the
success or failure can depend on each determination.

For example, the directors make decisions about the goals of their
organizations, where to locate the factories, in which new markets to penetrate and
what products or services to offer. Middle and lower level managers make
decisions about weekly or monthly production schedules, problems
that arise, salary increases for employees. But not just the managers.
decide. All members of an organization make decisions that
they affect their positions and the organization in which they work.

Every person who has to make a decision, whether in an organization or in their

personal life, considers two aspects:

The rational and analytical aspects

The emotional aspects and personal temperament

We cannot forget, either, the famous intuition, which is nothing more than a bias.
the emotional aspect, but some know how to use it very well and with
brilliant results and others not so much...

Taking these two aspects into account, the person who is in a process of
decision-making in organizations is still under the pressure of a third
the weather.

2. CHARACTERISTICS

The decision-making at the individual level is characterized by the fact that one
person uses reasoning and thinking to choose one
alternative solution to a specific problem; that is, if a
The person has a problem, they must be able to solve it independently.
making decisions with that specific purpose. Also, decision-making
is considered one of the stages of management.

2
 In decision-making, the choice of a path to follow is important, so
In a previous state, alternatives for action must be evaluated. If the latter
if they are not present, there will be no decision. To make a decision, anyone
that it is its nature, it is necessary to know, understand, analyze a
problem, in order to provide a solution. In some cases, due to being so
simple and everyday, this process is carried out implicitly and is resolved
very quickly, but there are other cases in which the consequences of
a bad or good choice can have repercussions in life and if it is in a
work context in the success or failure of the organization, for which it is
it is necessary to carry out a more structured process that can provide more security and
information to solve the problem.

3. STAGES OF THE DECISION-MAKING PROCESS

According to Robbins & Coulter (2005), the decision-making process includes a

series of eight stages that begins by identifying the problem and the criteria of
decision and to weigh them; then we proceed to outline, analyze, and choose one
alternative to solve the problem, and to conclude the effectiveness of the
decision. This process is so relevant to your decision on which movie to watch
Friday afternoon for a corporate event, like making a decision
about the use of technology to manage customer relationships. The
The process also serves to describe decisions of individuals and groups.

A. Identify and Analyze the Problem

The decision-making process begins with the existence of a

problem or, more specifically, a discrepancy between the situation
current and the desired situation. Let's take the case of Sara, manager of
saleswoman who was laid off and wants to be an entrepreneur instead of
to return to work for a company. For the sake of simplicity,
let's suppose that Sara does not want to buy a small business, but instead
What franchises can be obtained is preferred to see. This way we have a
Problem: there is a disparity between the place where Joan is located.
now (unemployed) and the place where she wants to be (entrepreneur and
franchise owner). She has to make a decision about which is the
best franchise to buy.

The identification of problems is a subjective activity. What one

A manager sees one issue as a problem while another may not view it that way. Moreover, the manager

that by mistake solves the wrong problem has a performance

as bad as the manager who does not identify the right problem nor takes action
nothing.

As it appears, it is neither easy nor trivial to identify problems. To do so

better, managers need to understand the three characteristics of the
problems: being aware of them, being pressured to act and
to have the necessary resources to undertake actions.

Managers become aware of a problem by comparing the status

actual of things with the situation they should be in or would like to be

3
 that they were. If things are not where the managers want or
They march as they should, there is discrepancy. But this is not enough.
so that it is considered a problem.

A discrepancy without the pressure to act is a problem that can

to be postponed. To initiate the decision-making process, the problem
He must urge the manager to take action. The pressure can come from
example, of organization policies, deadlines, economic crises, acts
from the competition, customer complaints, boss's expectations or a
imminent performance evaluation.

Finally, it is unlikely that managers will point out anything as a problem.

if they feel they do not have the authority, the information, or the resources
to act. If managers recognize a problem and are pressured
to act, but they feel that they do not have the right resources,
they explain that it is a situation in which there are unrealistic expectations
about what they can do.

B. Identify the decision criteria and weigh them

It consists of identifying those aspects that are relevant at the moment.

to make the decision, that is, those guidelines on which it depends
decision that is made. Weighting is assigning a relative value to the
the importance of each criterion in the decision that is made, since
Everyone is important, but not in the same way.

When a manager detects a problem, they have to identify the criteria

important decisions to solve it; that is, managers have to
determine what is pertinent to make a decision. Be explicit or
tacit, managers have criteria to guide their decisions. In
in our example of purchasing the franchise, Sara has to evaluate what
factors are relevant for making a decision, criteria such as costs of
beginning, availability of financing, failure rates, potential
growth, open geographical regions, background and support of
franchise owner, and financial ratings. After a
detailed study, Sara decides that the start-up costs, the qualifications
financial, the background and support of the owner, as well as the regions
the relevant criteria for their decision would be open.

C. Define the priority for addressing the problem

Correctly prioritize the selected criteria in the stage

previous, since not everyone will have the same relevance in the decision making
from the final decision. Normally there is a preferred criterion, and the rest
they can be weighed by comparing them to each other and valuing them in
relationship to the preferred. How are the criteria weighted? A method
simple consists of giving the most important criterion a weight of 10 and taking it
as a reference to weigh the others.

4
 In the following table, the criteria and weights that Sara
established for his decision to buy a franchise. As it is seen, the
startup costs are the most important criterion in your decision; the least
The background of the franchise owner is important.

D. Generate the solution options

It involves developing different possible solutions to the problem. While

it is usually not possible to know all the possible ones
ways that can be taken to solve the problem, the more the better
options will be much more likely to find one that works out
satisfactory. The development of an exaggerated number of options can
make the choice extremely difficult, and for that reason, it is not
necessarily favorable to continue developing options in a way
undefined.

To generate a large number of options, a fee is required.

important creativity. There are different techniques to enhance the
creativity, such as brainstorming, forced relationships,
, it is important at this stage "the creativity" of the decision-makers.
of decisions.

E. Evaluate the options

It consists of conducting a detailed study of each of the possible

solutions that were generated for the problem, that is to say looking at their
advantages and disadvantages, individually regarding the criteria of
decision, as well as the possible consequences that may
detach from them.

There are tools, particularly for business management.

to evaluate different options, which are known as methods
quantitative. At this stage of the process, critical analysis is important
as a quality of the decision-maker.

F. Selection of the best option

In this step, the option is chosen that according to the evaluation will obtain
best results for the problem. To this end, they will be discriminated first
place those that are most distant from the needs or objectives, up to
find the one that is considered most accurate. There are techniques (for

5
 example, hierarchical decision analysis) that help us to assess
multiple criteria.

The following terms may help in making the decision according to the
result that is sought:

Maximize: Make the best possible decision.

Satisfy: Choose the first option that is minimally acceptable.
acceptable satisfying in this way a goal or objective
sought.
Optimize: The one that generates the best possible balance between
different goals.

G. Application of the decision

Implement the decision made in order to evaluate whether the decision

it was right or not. People need to be informed about it or
affected companies. This requires a planning process and
prior organization.

H. Evaluation of the results

After implementing the decision, it is necessary to evaluate whether it

Did it solve the problem or not, that is, if the decision is having the
expected result or not.

If the result is not what was expected, it should be looked at whether it is because it must
give oneself a little more time to achieve the results or if
definitely the decision was not the right one, in this case it should be started
the process again to find a new decision.

The new process that will be initiated in case the solution has been
incorrect, will have more information and there will be knowledge of the
errors made in the first attempt.

Find a solution to the initial problem without it leading to the emergence of

others, it would be the most significant success story. If so, the alternative
chosen could be applied to other similar conflicts. Otherwise,
would provide information to prevent errors in the future.

Additionally, one must be aware that these decision-making processes

they are in continuous change, that is to say, the decisions that are made
they will continually have to be modified, due to the evolution that
have the system or due to the emergence of new variables that affect it.

4. FACTORS TO CONSIDER IN THE PROCESS

Before making a decision we must:

Define the constraints and limitations.

Knowing the cost-benefit relationship, expected returns or others.

6
 Knowing when to use quantitative methods and when to use qualitative ones.

Understanding the formal internal factors (organizational culture, policies

internal, structure, etc.) and the informal internal factors (policies
implicit, habits, experience, etc.

Knowing the external factors (political, economic, social, ...

international, cultural

When decisions are made in an organization, there are a series of factors that
they must also be taken into account, such as the following:

. Limited rationality: Those who make decisions must have the

sufficient information about the problem to analyze and evaluate it. The criterion
what guides the decision is efficiency, which is achieved by maximizing
results with the minimum resources.

. Relativity of decisions: Choosing a certain option implies the

waiver of others and the consequent creation of new situations
in time. Hence the importance of evaluating the consequences of the
possible solutions.

. Administrative rationality: It refers to the use of techniques that facilitate

the application of organized work. One must choose to select and
employ the most suitable courses of action for communication between
the people.

. Organizational influence: Decisions are made from the

perspective of the organization's interests and its internal rules.
In that sense, there is a culture, a division of tasks, a
hierarchization of decision making, performance standards,
authority systems, communication channels, training and
indoctrination, etc. The opposite of this is decision-making by
individual whim.

5. CLASSIFICATION OF DECISIONS

Decisions can be organized according to two different criteria: by

method and by levels:

By method:

I. Rational or structured decisions: These are the ones made based on

to a specific process or concrete criterion (for example, some rules or
laws) and arise in a repetitive and routine manner. By their nature, they are
predictable.

II. Intuitive or unstructured decisions: These are the ones that face
a new situation. Unlike the previous ones, they do not start from a
previous process or criterion, either because the need has not arisen before
to face them or for having a complex nature. They are not

7
 Predictable. The people who make the decisions must use their judgment.
intuition and creativity.

By levels:

I. Planned decisions: In companies, they are made by the leaders.

higher in the hierarchical scale. These are decisions that affect the
relationships between the company and its environment, of great significance and not
repetitive. They require extensive analysis of the information and reflection.

II. Tactical decisions: They can be repetitive or not and, often, the
it takes middle management. Care must be taken, as the
the occurrence of several errors can negatively affect the
company.

III. Operational decisions: They relate to daily activities of the

company and they are handled by lower-level leaders.

6. TECHNIQUES IN DECISION MAKING

In decision making, there are also quantitative and qualitative techniques.

for selecting the best decision.

Qualitative Techniques: When they are based on the criterion of experience, and
skills

Quantitative Techniques: When mathematical methods are used,

statistics, etc.

7. MODELS IN DECISION MAKING

Starting from the definitions of Hellriegel, Slocum (2004) and Stoner (2003), the
decision making is an important part of the manager's job. However,
when a manager makes a decision or when the cost of searching and evaluating the
alternatives are low, the rational model provides a description
moderately requires the decision-making process.

Given the above, the following outlines a vision of how decisions are made.
really most decisions in organizations, through the
characterization of three decision-making models according to the criteria
established by McLeod (2000): the rational, the limited rationality and the
political. The utility of these models lies in that they help to identify the
complexity and variety of situations for decision making in a
organization.

a) RATIONAL MODEL

Pursue the establishment of a process for selecting between alternatives to

maximize the benefits of the organization. It includes a broad definition
of the problem, a thorough collection and analysis of the data, thus
as a careful evaluation of the alternatives.

8
 Furthermore, from the organizational point of view, there are some
limitations for this model:

Its use may require quite a bit of time and it may be that the
organizations do not have it.

The use of human resources can outweigh any benefit.

This approach requires data and information that, typically,

they are difficult to obtain.

If the decision-making process requires considerable

over time, these may become obsolete.

Managers may be forced to act if the goals are

vague or contradictory, thus leading to changes in the goals
established, the criteria or their weighting if the alternative is the most
favored does not turn out to be the first.

b) MODEL OF BOUNDED RATIONALITY

Describe the limitations of rationality and highlights the

decision-making processes frequently used by people
and teams. This model explains why different people or
teams make different decisions when they have exactly the
same information.

Provide quick and easy ways to reach a decision without analysis.

and detailed searches. They are written and applied easily. Now
Well, its main disadvantage is that it is based on decision-making.
through the construction of simplified models that extract the
essential characteristics of problems, without capturing all of their
complexity.

c) POLITICAL MODEL

Describe the decision-making of people to meet their needs.

personal interests. Preferences based on personal goals
Selfish people rarely change as new information is acquired.
thus, the definition of the problems, the search and collection of data,
the exchange of information and the evaluation criteria are only
methods used to predispose the outcome in favor of the one who takes the
decision.

The political model prevails in organizations around the world, it is

to say, prevails above the two models previously described for being
the basis of the organizational procedures established by the management
directive. From the perspective of managerial practice, the political model
is expressed very vividly in organizations through the use of
various methods of influence, means by which individuals or
groups try to exert power or influence the behavior of others.

9
8. DECISION-MAKING STYLE

All people who make a decision have a unique set of

personal characteristics that influence their problem-solving.
For example, in a company, the creative manager will tolerate uncertainty well and
will offer various alternatives for your decision in a shorter time.

The basic assumption of the decision-making model lies in recognizing that

people differ in two dimensions:

The first dimension is the way of thinking. When it comes to making a

decision, there are people who do it with a greater logic and
rationality, processing information sequentially. Without
embargo, other people face this process in a more
creative and intuitive, considering a broader perspective.

The second dimension refers to tolerance for ambiguity

what people tolerate. In those situations where the individual,
to make the decision, it requires a lot of coherence and order in the
information, the degree of tolerance for ambiguity is minimal. In
contraposition, in those people capable of processing a multitude of
information at the same time, assuming with it an important degree of
uncertainty, the tolerance for ambiguity is high.

Taking into account these two dimensions, Stephen P. Robbins (Supervision

Today, Prentice Hall, Upper Saddle River, NJ, 1995) developed a diagram
where the four styles for decision-making appear.

i. DIRECTIVE STYLE

The directive style for decision-making is characterized by a low

tolerance for ambiguity and a totally rational way of thinking.
this style is associated with those individuals with a high level of reasoning
logical, capable of making quick decisions, focused on the short term. Their
effectiveness and speed in decision-making allows for the adoption of a solution
with minimal information and evaluating few alternatives.

ii. ANALYTICAL STYLE

The analytical style for decision-making is characterized by greater

tolerance for ambiguity that leadership types, combined with a
a completely rational way of thinking. These people need more
information before making a decision, considering and analyzing more
alternatives. Individuals situated in this analytical style
they are characterized by their ability to adapt to or face situations
unique.

iii. CONCEPTUAL STYLE

The conceptual style for decision-making encompasses people with a

great tolerance for ambiguity and an intuitive way of thinking. These

10
 people are characterized by having a wide capacity to process
information from an extensive perspective and a high capacity
analytics trying to analyze many alternatives. They focus on the long
They often look for creative solutions to problems.

iv. BEHAVIORAL STYLE

The behavioral style represents those people whose way of thinking

it is intuitive but whose degree of tolerance for ambiguity is
low. These people work well with others, they are open to the
suggestions and they care about those who work with them. The acceptance
of others is important for those of this style of decision-making.

9. CONCLUSIONS

The decision-making process is undoubtedly one of the greatest

responsibilities, however, the decisions mark the success or failure of
Any organization, they are like the engine of business.

At the moment of making a decision, it is important to be able to study the

problem or situation and consider it deeply to choose the best path
next according to the different alternatives and operations. It is also vital
importance for management as it helps to maintain harmony and
coherence of the group, and therefore its efficiency.

Making a decision also involves resilience because we never

We must not give up in the face of the obstacles that arise.

Once a decision is made, there is no turning back and you will have to face it.
the consequences for that, take some time to analyze what you are going to do.

Decision-making is a process particularly tied to leaders.

but it remains a skill that anyone in the company can
learn and develop. Although it may be difficult at first
understand or implement, most people have internalized this
dynamic from its own experience. It is essential to make the right decisions,
Their success depends on them!

In decision-making, experience is a key element since the

decisions must be made about a highly complex reality due to the
enormous number of variables that come into play. The accumulation of
experience is long and costly.

11
 BIBLIOGRAPHY
Claver, E. L. (2000). Business Administration Manual (4th ed.). Madrid.
KAST, F. E. (1979). Administration of Organizations. McGraw-Hill Publishing.
Koontz, H. y. Management. A Global Perspective. Mexico: McGraw Hill.
Decision Making Classification of decisions
ones
Unable to access the provided link for translation.
decisions2.shtml#stageasiga
Unable to access the content from the provided link.
Unable to access the provided URL.
the company
Unable to access the content at the provided URL.
decisions-in-the-organization/
The provided link does not contain text for translation.
Invalid input. The provided link is not text to be translated.
https://www.heflo.com/en/blog/business-management/decision-making/

12