Decisions are the basis of our society and are part of our daily lives. They are present and move through all social, economic and political circles. We could say that as you read this article, thousands of decisions are being made that may affect you to a lesser or greater extent.
In the following list, you will learn great tips on decision-making for the managers of a company, applicable to any business model. This is a job on which literally depends the success or failure of an organization, regardless of its size. You will also find out what qualities you need to have to take on management (2).
The most important
- The ability to learn and self-management are indispensable qualities for you to be able to take on a managerial position.
- The science of decision-making is made up of a web of different circumstances and factors that require a lot of conscious observation.
- Learn to work with your team and make the most of their qualities. You have to be a good leader.
The best tips for managerial decision-making: The definitive list
Below, you will find a very up-to-date list that will help you in your work as a manager and in decision-making. Also, we will show you charts and concepts created by experts, which have been used for many years among managers of small, medium and large companies around the world.
1. Research the market context.
If your goal is to make sound strategic decisions and take stock of the market on an annual or semi-annual basis, you can use PESTEL analysis. This is a method used to understand the context of a company. It seeks to delve into the environment surrounding a business, for example: political, economic, environmental, sociocultural, psychological or legal aspects.
Knowing exactly what is going on around you is one of the most important tasks in management decision-making.
2. Types of decisions
(Source: Sergio Orozco/ Gitnux)
Normally, you will find two types of decisions: operational and strategic. Operational ones refer to the decisions you have to make on a routine basis, related to the day-to-day running of the company, and strategic decisions are made thinking about the future of the company, using data or creating possible scenarios in which certain actions will have positive or negative effects (3).
How to make difficult decisions could be considered a science, since it requires evaluating different scenarios, applying strategies that depend on experience, intuition and how data is managed and where it comes from.
3. Knowing your human capital
You should always value your entire team. Those who are human capital managers should keep in mind that each of them, no matter what level they are in the organization, may bring a different perspective to a common or complex problem.
Of course, if you know what your team’s strengths and weaknesses are, you will be able to create strong work groups or assign tasks to the right people to do so.
The key to successful management in organizations lies in the people involved. In today’s world, high levels of competitiveness demand new ways of engagement, of seeing facts, of deciding and leading, of thinking and feeling, as well as of managing human relations in organizations more effectively (4).
4. Assess expectations, resources and constraints
When you are in the middle of an important decision, one of the qualities of a good manager is to be able to look at what tools he/she can work with and think about what are the most favorable results he/she could obtain.
Also, to be able to identify which are the limits that you cannot go beyond and at the same time, to be able to fulfill the objectives set by the organization (1).
5. Establish priorities among the different objectives
Brand management and its direct impact on results is the job of managers and executives, who must be obvious about the objectives that have been set in different situations, such as market expansion or staff cuts, for example.
Each of these actions can bring good results, and a containment plan must be drawn up for possible adverse effects. General managers must, in turn, monitor the objectives and learn from their decisions to improve. Objectives come from strategic plans in management decisions and cascade down to lower levels.
Each level creates objectives aligned with those of the higher level. In this way, general objectives become specific objectives in the functions and sub-functions, all the way down to the lowest units in the organization (5).
6. Problem-Solving Skills
This is one of the skills you should work on the most if you are a manager. Day to day, you will solve all kinds of problems, some may be very routine and with predictable results, but in other types of decisions of higher caliber, the scenario of action and data will be diffuse.
Therefore, experience will grow over the years with all the successes and mistakes from which you will learn. Also, intuition and the ability to anticipate possible unfavorable scenarios is what could help you the most.
7. Maximize profits and minimize risk
Many managers tend to use their own judgment about risks, and those judgments can become organizational judgment. How can you evaluate a risk objectively and not emotionally? This is critical because of the natural human reaction to change.
Your goal will be to get the most out of each situation (5). These are 3 factors that tend to influence when you have to take risks of strategic decisions of your company:
- Personal acceptance of risk: This is the consequence of our personal experiences, circumstances, education, etc.
- Team risk acceptance: Remember that each organization has its own attitude to risk taking.
- Actions available to manage the risk: What are the awareness generated by a risk, the type of actions and plans to implement to manage risks.
Track leads, close opportunities and get accurate forecasts.
8. Find causes, not culprits
It is very common in many organizations to find discussions about who was to blame for a bad result. It is then, when you should focus on finding the cause, thinking about where, when and why the mistake occurred.
Also, examine all the facts before making unfounded accusations, because to eliminate a problem you must eliminate the cause, and the cause is always a relevant change (7).
2. A good leader is the one who manages to genuinely convince
Clearly, you will have to strive to do your best, so that your different teams and departments can feel your passion for the job and also carry the values of the company in all your decisions.
You must be charismatic, assertive if circumstances require it and listen carefully to the entire team. Take your organization to the highest level and make them feel guided by a good leader who they will respect for good management.
We could divide leadership in two: Formal and informal. Formal leadership is pre-established by an organization, and informal leadership is when someone emerges from the group to take the reins. Based on this, in the following table, you will see some of the different types of leaders according to the relationship with their followers (8).
Types of leaders
| Type of leader | Description |
|---|---|
| Dictatorial leadership | forces his own ideas on the group instead of allowing the other members to take responsibility, allowing them to be independent. Is inflexible and likes to order. Destroys the creativity of others. |
| Autocratic | the leader is the only one in the group who makes decisions about the work and organization of the group, without having to justify them at any time. |
| Democratic | the leader makes decisions after encouraging group discussion, welcoming the opinions of his followers. |
| Onomatopoeic | the leader, while reflecting on the vision that should move the led group towards its desired objective, expresses himself through simple verbal onomatopoeias that notably favor the enthusiasm of the group. |
| Paternalistic | has confidence in his followers, makes most of the decisions by delivering rewards and punishments at the same time. |
9. Know thyself
In the number one position, as always, is you. To know how to govern any type of organization, it is essential that you know what your strengths, limitations, opportunities and threats are in all areas of your life. Likewise, you must plan and evaluate what new practices are leading you down the path of professional development. Discipline and perseverance are skills present in all successful people and managers of large multinationals.
For this task, you can use the SWOT matrix, widely used for many years as a tool for professional development and also applicable in business environments of all kinds.
Conclusion
As you can see, being a manager brings with it hundreds of responsibilities and challenges that will become greater and greater as the company scales. Face them with courage and determination along with knowledge and experience, which are qualities that can take you to the pinnacle of your management career.
Never stop preparing yourself, and with a little luck you will have more successes than failures. But above all, please keep in mind that mistakes are only opportunities to improve.
References
1. Vanegas Lago E, , Guerra Cantero L. M. Business intelligence system to support the decision making process. Revista INGENIERÍA UC [Internet]. 2013 [cited January 7, 2023]
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2. “Cynthia Zaira Vega Valero, Diana Elisabeth Reza Morales, Oscar García Arreola, Rosa Alejandra Hernández Toledano and David Ruiz Méndez, Decision making scale for managers. Facultad de Estudios Superiores Iztacala, UNAM Mexico.2021 [cited January 7, 2023] “
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3. Marcel Planellas, Anna Muni. Strategic decisions: The 30 most useful models. [cited January 7, 2023]
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4. Martín Linares X, Segredo Pérez AM, Perdomo Victoria I. Human capital, academic management and organizational development. Educ médica super (Impresa) [Internet]. 2013 [cited January 7, 2023]
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5. Ernesto Blanco Martínez. Objetivos claros, clave del exito en la gestion empresarial.2010 [cited January 7, 2023]
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6. “Perales Palacios F.J, Problem solving. A structured review. A STRUCTURED REVIEW. Department of Didhctics of Experimental Sciences. Faculty of Education Sciences. University Campus of Cartuja. Granada. 1993 [cited January 8, 2023] “
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7. Jose Maria Garrido.The decision making process.2022 [cited January 8, 2023]
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8. Medicos P. Leadership, characteristics of the leader and the main current theories [Internet]. 2012 [cited 2023 Jan 8, 2023].
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