We all make decisions every day. They range from small choices about how much milk to put on your cereal in the morning to more significant decisions like choosing which strategies to use for marketing your business over the coming 12-24 months.
According to management expert James Stoner, when you make a decision you go through the “process of identifying and selecting a course of action to solve a specific problem.”
For example, it’s 8:00 am and just as you walk into the office, you realize you left your laptop at home. You consider the options. Should you go back and risk being late for your first meeting? Should you just work from home and dial into the meeting?
You decide that going back for the laptop is the best choice, and you also set a daily reminder on your phone to pack your laptop each morning.
You probably didn’t realize it while all of that was happening at 8:00 am, but you just went through a complex decision-making process. You weighed the pros and cons and analyzed possible outcomes to come to the best decision.
Are there different types of decision-making process?
Decision-making has been deeply analyzed and discussed over the years, and in short, there are many different types of decision-making processes that an organization could call upon.
As Stoner identified, decision-making boils down to spotting a problem and choosing the best solution to fix it, but there are other steps involved in the process for decisions that require more in-depth assessment than determining what do about your wayward laptop.
Three commonly used decision-making strategies are:
- GOFER – developed by psychologist Leo Mann in his book ‘Teaching Decision Making To Adolescents’, it outlines the decision-making process in five steps as:
- Goals clarification
- Options generation
- Consideration of Effects
- Review and implementation
- DECIDE – published by Kristina Guo, the model breaks decision-making into six steps:
- Define the problem
- Establish all of the criteria
- Consider alternatives
- Identify the best alternative
- Implement a plan of action
- Evaluate the solution and assess feedback
- Seven-step decision-making process – Pam Brown of Singleton Hospital in Swansea, Wales, broke the process of decision-making into seven steps:
- Outline goals
- Gather data required
- Develop alternatives
- List the pros and cons of each available alternative
- Make the actual decision
- Take action and implement decision
- Learn and reflect
You’ll see that in each of the above models there are subtle differences, but each revolves around the idea of outlining a problem or goal, considering potential solutions, implementing the decision, and then reviewing it.
How does knowledge management influence a decision-making process?
Referring back to our earlier example of the 8:00 am laptop dilemma. Is there anything that you could have known that would have influenced your decision?
If you knew you had an 85% chance of missing your meeting, should you return home,, would you have opted to work remotely? What if you had been told the day before that your morning meeting was going to be cancelled – would you have felt more comfortable running home and coming back?
The more knowledge you have, the better your decision-making will be, according to research carried out by MBA professor K.D. Joshi. With that in mind, knowledge management can have a significant impact on how effective an organization is at decision-making. Furthermore, proper knowledge management can foster a collective consciousness – ie a set of shared beliefs and ideas – that help the entire organization run more smoothly and efficiently. After all, if everyone understands how and why others around them make decisions, it becomes easier to make future decisions that align with the company’s mission and values.
In each of the above decision-making models, you’ll notice that forecasting and assessing data or alternatives is a particularly important of the process. It is here where you weigh up which choice might be the most logical or return the better outcome more often than not. It is also here where having greater knowledge will be highly beneficial and can heavily determine which decision is selected.
This is where your organization’s approach to knowledge management becomes crucial. Based on our experience, working with hundreds of forward-thinking organizations, here are some questions you should ask yourself, in order to assess the health of your decision making processes:
- Can your employees easily access all the available knowledge they require to make an appropriate decision when they need?
- Do employees have a way to solicit input and suggestions from others within the organization when they’re making a decision and gathering information?
- If you have a mechanism for employees to solicit input, is it easy, and can it be done without disrupting other people’s days and workflows?
- Have employees had a way of recording their decisions or documenting their decision-making process in the past?
Though it might seem intuitive that people make better decisions when empowered with more knowledge, it’s not always intuitive how you actually empower people with this knowledge. This task is further complicated when you have hundreds – or even thousands – of employees. Transferring knowledge becomes exponentially more complex when you have a large team or network of stakeholders. That’s where a knowledge management platform like Tettra can help you store and access knowledge whenever it’s required so that your employees can make the optimum decisions, and quickly.
We’d encourage all organizations to take stock of their decision-making processes on occasion. Take the temperature of your workforce by posing the four questions we list above. You may find that your company can dramatically improve the speed and efficacy of decision-making with just a few changes. By focusing on robust knowledge management, you’ll enable people to tap into the organization’s collective consciousness and make better decisions.