Decision-Maker: What They Do, Why They’re Vital, How To Make Decisions

Effective, informed, and timely decision-making lies at the heart of business success. Whether the decisions are about investment, association, employment, or marketing strategy, the choices you make can make or break your business. Good decision-making is to thank for business success, reputation, and profit. Poor decision-making jeopardizes business growth and can damage the company’s reputation.

Successfully fulfilling the role of the decision-maker is by no means an easy feat, given the pressure that comes with fostering business growth, but it doesn’t have to be complicated.

In this article, we’ll explore what makes a person a good decision-maker, how to identify decision makers and offer some simple yet practical tips and advice on how to become a better decision maker to make your final word count.

What is a Decision-Maker?

Cambridge English Dictionary defines a decision-maker as ‘a person who decides things, especially at a high level within an organization.’

Decision-making is a daily challenge for business owners, managers, and employees alike. A business manager must make important decisions such as who to hire and who to let go, while a marketing manager must consider the sales process and type of content a business will create and distribute.

There are many roles in business decision-making. The people in a small or large company who make choices to solve or prevent problems are the decision-makers. They play a crucial role in their company’s success and use evidence, expertise, and intuition to get the best for their business and the end user.

Decision-makers also collect the most valuable and relevant information and apply it to help the company achieve optimum growth.

What Does a Decision-Maker Do?  

Decision-makers occupy their role at a company because they have repeatedly proven to make effective choices at the right time. When a company successfully achieves a goal, the decision-maker usually receives a lot of praise, and rightly so.

Of course, business requires a collaborative effort, but the decision-maker’s foresight and experience helps everyone work towards the same shared goal.

So, how exactly does a decision-maker finalize their decisions? First and foremost, the decision-maker must know that there is a decision to be made.

For example, there may be a chance to boost the company’s growth in a short amount of time by hiring a talented marketing agency, but the agency’s fees are high. The decision-maker now must decide if investing in this new marketing agency is worth it.

Once it has been established that a decision must be made, the decision-maker must gather all the relevant information available. This includes a profit forecast, alternative agencies that could deliver the same or better results for a reduced fee, the agency in question’s track record, the risk-reward ratio, and the available budget.

After gathering as much relevant information as possible, the decision-maker must review their choices several times before making a final decision.

Why are Decision-Makers Important?

“Whenever you see a successful business, someone once made a courageous decision.”– Peter F. Drucker.

Decision-makers play a vital role in a company. Their primary goals are to keep the company moving towards greater and greater success and profitable growth.

Decision-makers are responsible for making significant decisions for their company so that other employees can focus their attention on day-to-day projects without juggling too many tasks at once.

Some common benefits of having skilled decision-makers in your company include:

  • Ensuring the company continuously takes growth-oriented action
  • Investigating and associating with mutually beneficial business partners
  • Crafting effective strategies to boost sales
  • Creating promotional strategies to grow brand awareness and generate more leads
  • Planning and implementing policies to keep the business successful and employees satisfied

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How to Make Significant Decisions for your Business and Improve your Decision Making Skills

Below you will see a step-by-step process to inform your decision making. Follow these steps for deliberate and well-thought-out decisions with optimum results.

Bear in mind that the most important part of being able to make a decision, is actually making one. In business, as in life, hesitation and procrastination bring their own problems. It is also important to note that anyone can be a decision maker, irrespective of your job title or your company size.

“On an important decision, one rarely has 100% of the information needed for a good decision no matter how much one spends or how long one waits. And, if one waits too long, he has a different problem and has to start all over. This is the terrible dilemma of the hesitant decision maker.” – Robert K. Greenleaf.

If you have a decision that needs to be made, consider and apply the following:

Step 1: Define the Decision

The first step for decision-makers in making any effective decision is to recognize that a decision must be made. Try to be clear and articulate about what needs to be decided. This will help you progress to the next steps more efficiently.

Step 2: Gather Information

Decision-makers gather as much relevant information as possible before making a decision.

So, figure out what kind of information you need, where you can get it from a reliable source, and how to apply it.

Step 3: Assess the Alternatives

Decisions would be much easier if there weren’t so often several potentially better alternatives. Decision-makers take time to understand and consider alternative plans of action and write a list of all the other options.

Make sure to be as specific as possible about every potential approach.

Step 4: Consider the Evidence

Use your gathered information, past experience, and intuitive understanding to imagine how to go through each identified alternative. Consider how each option would satisfy the need you discovered when you knew a decision had to be made.

You may like two alternatives more than others. Prioritize alternatives in order of favorability and potential for success.

Step 5: Choose

Decision-makers have the ability to choose.

Having considered all of the evidence and weighed up all the alternatives, you’re ready to get specific. Choose one of your alternatives or a combination of alternatives if your budget and resources are flexible enough.

Step 6: Follow Through

Decision-makers follow through on their choice.

Once you’ve chosen the best alternative, it’s time to take action by implementing your choice. Gather the resources you need to implement the decision you’ve made and move forward with confidence.

Step 7: Review your Decision

Decision-makers always review their decision to ensure that it has addressed the issue.

The final step is to consider the impact of your decision. Assess whether or not it had solved the problem presented before you had to take step one.

If your decision does not solve the issue at hand, go back through the seven steps to come to a new conclusion. You might need more information or to reconsider some of the alternatives you dismissed earlier.

What Factors Influence Decision-Making?

Several factors influence business decision-making. One factor is group size. A study conducted by researchers at Princeton University found that smaller groups are better at making wise, important decisions than bigger groups.

The research points out that important information known only to a few group members gets lost among the information shared as a whole in a larger group.

One’s state of physical and mental health well-being also influences decision making. How we look after ourselves in terms of our personal lives has a huge impact on how well we make decisions.

If we have long days at work, eat unhealthy food, and neglect to look after our bodies, our minds will not be in an optimal position to accurately assess all the data at hand and make effective choices.

One study published in the journal of Cognition found that the best decisions are made in the morning. This is because the brain’s serotonin levels are highest in the morning. With higher serotonin levels, one can take more risks because they feel confident.

The Bottom Line

In business, the decision-making process comes with many challenges. The decision-maker must assess all the data in front of them and dig even further to collect data that isn’t so easy to find.

They must be diligent in searching for the most accurate and essential information and be confident enough to take risks, even though those risks will affect other people.

Business, like life, has unexpected twists and turns, and we’re likely to make some mistakes along the way – we’re only human! However, the best decision-makers prepare for what’s around the corner by expecting the unexpected.

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