Decision making can be regarded as the mental processes (cognitive process) resulting in the selection of a course of action among several alternative scenarios.
Every decision making process produces a final choice. The output can be an action or an opinion of choice.
Three decision making approaches will be considered here:
- Problem solving
- Problem seeking
Often unspoken is that one alternative is to not make a choice - that is, to avoid making a decision for the time being. There are several reasons why the decision maker may do this:
- Insufficient information
- Potential consequences of making a decision (including those who disagree will resist decision, cost to the organization and consequences to others).
- A judgment to delay making a decision to allow time for other parties to make a decision or take action.
- The decision is not one properly made by the person asked to make a decision.
- A judgment that a decision isn't necessary - the situation can continue without the intervention a decision might entail.
One example of avoiding a decision is routinely made by the Supreme Court of the United States (as well as by other appellate courts). The Supreme Court will decline to hear a case because, in their judgment, the issues have not been sufficiently argued in other courts and decisions rendered by other judges.
Decision making might be regarded as a problem solving activity which is terminated when a satisfactory solution is reached. Therefore, decision making is a reasoning or emotional process which can be rational or irrational, and can be based on explicit assumptions or tacit assumptions.
Problem solving consists in using generic or ad hoc methods, in an orderly manner, for finding solutions to specific problems. Some of the problem-solving techniques developed and used in artificial intelligence, computer science, engineering, mathematics, medicine, etc. are related to mental problem-solving techniques studied in psychology.
In psychology, problem solving refers to a state of desire for reaching a definite goal from a present condition that either is not directly moving toward the goal, is far from it, or needs more complex logic for finding a missing description of conditions or steps toward the goal. In psychology, problem solving is the concluding part of a larger process that also includes problem finding and problem shaping.
It is important to differentiate between problem analysis and decision making. The concepts are completely separate from one another. Traditionally it is argued that problem analysis must be done first, so that the information gathered in that process may be used towards decision making.
A principal task of a leader is to improve the organization. Part of the job, then, is to seek out areas for improvement through a process of problem seeking to clarify, understand and state the problem(s). A clear problem statement is the first step in the decision making process.
How a problem is stated will drive the decision making process and the solution that is ultimately chosen.