THE DECISION MAKING PROCESS

1. Diagnose problem
if a manager wants to make an intelligent decision, his first move must be to identify the
problem. If the manager fails in this aspect, it is almost impossible to succeed in the subsequent
steps.
2. Analyze the environment

the environment where the organization is situated plays a very significant role in the
success or failure of such an organization

Components of the Environment. The environment consists of two major concerns: the
internal and external

Internal environment – refers to organizational activities within a firm that surrounds decision-
making.

External environment – refers to variables that are outside the organization and not typically
within the short-run control of top management.

3. Develop Viable Alternatives

oftentimes, problems may be solved by any of the solutions offered. The best among the
alternative solutions must be considered by management. This is made possible by using a procedure
with the following steps:

Prepare a list of alternative solutions.

Determine the viability of each solutions.

Revise the list by striking out those which are not viable.

4. Evaluate Alternatives

after determining the viability of the alternatives and a revised list has been made, an evaluation
of the remaining alternatives is necessary. This is important because the next step involves making a
choice.

5. Make a choice

after the alternatives have been evaluated, the decision-maker must now be ready to make a
choice. This is the point where he must be convinced that all the previous steps were correctly
undertaken. To make the selection process easier, the alternatives can be ranked from best to worst on
the basis of some factors like benefit, cost, or risk.
 6. Implement Decision

refers to carrying out the decision so that the objectives sought will be achieved. To make
implementation effective, a plan must be devised.

7. Evaluate and Adapt Decision Results

In implementing the decision, the results expected may or may not happen. It is, therefore,
important for the manager to use control and feedback mechanisms to ensure results and to provide
information for future decisions.

Control – refers to actions made to ensure that activities performed match the desired activities
or goals, that have been set.

Feedback – refers to the process which requires checking at each stage of the process to assure
that the alternatives generated, the criteria used in evaluation, and the solution selected for
implementation are keeping with the goals and objectives originally specified.