3 Steps to ensure Better Decision Making

Join the PG Diploma in Business Management to succeed in life

Decision making is an art of weighing inputs such as risk and data on one hand and emotions like uncertainty and fear on the other. It is always argued that qualities like leadership, decision making etc are inborn and cannot be acquired. Well! I would beg to differ. These are the qualities that are learned from experience and acquired over time. That is why, group projects are a basic part of all Post Graduate Diploma Courses not only in management but in all types of courses.

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There is a common perception that only top level managers are a part of decision making process. However, Managers do have an important role to play when it comes to lower level decision making. In our PG Diploma in Business Management, Group Decision making is the most important part of the Management Development Programme.  Special emphasis is laid on 3 steps while teaching Decision making.

Step 1 – Think Out of the Box – Breaking the traditional Frame

Psychologists Daniel Kahneman and Amos Tversky wrote an insightful paper called The Framing of Decisions and the Psychology of Choice. They explained two things through this :

  1. We do not treat losses and gains equally. It is basic human nature to look at the prospect of a loss more powerfully than the promise of a gain.
  2. Before coming to any decision, it is within human nature to place mind frames around the problem. These frames once created largely affects the decision making process.

So it is very important to break these frames and think out of the box. The brainstorming sessions are a great way to do that. When we discuss a certain problem with a certain set of individuals, we receive both acceptance as well as repulsion to our decision helping in breaking the frame and hence a better decision.

Step 2 – Power of Comparisons

Dan Ariely, professor of psychology and behavioural economics  at Duke University, explains in his book Predictably Irrational that “Most people are not aware of their wants and aspirations unless they see it in some context.” He says, “Relativity is the lens through which we view the world and it’s everywhere.” but the only problem is,  “We not only tend to compare things with one another but also tend to focus on comparing things that are easily comparable—and avoid comparing things that cannot be compared easily.”

So that’s the catch. Comparisons if done wisely can go a long way in an effective decision making process. Therefore, some criteria needs to be set before starting the process altogether. Parameters need to be decided to judge the success and failure of the decision making process.

Step 3 – Magic of intuition backed by the whole team

Psychologist Daniel Kahneman, in his book, Thinking, Fast and Slow, explains intuition beautifully. He says, “Expert intuition strikes us as magical, but it is not. Indeed, each of us performs feats of intuitive expertise many times each day.” Intuition comes from experience and it can be in any field possible.

Expert intuition can be a hindrance to group decision making process. However, if seen from different perspective, group discussion can help hone that intuition converting the raw intuition to a result-oriented decision capable of reaping benefits in long run.

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