Decision Making: Understanding the Psychology and the Key Steps to Effective Decision Making

This blog post will explore the psychology behind decision-making and steps for making sound decisions.

Are you having trouble making decisions for yourself and for your team? Ever regretted some  of these decisions you made?

Making strategic decisions is a critical part of any workplace.

Leaders and managers need to be able to think on their feet and make decisions that will benefit the company as a whole.

However, making the wrong decision can have disastrous consequences.

Truth is, there are plenty of factors that influence the decisions we make in our lives day in and day out, work or personal life.

This blog post will explore the psychology behind decision-making and steps for making sound decisions.

We'll look at how to gather information, weigh options, and overcome obstacles.

So whether you're making choices for your business or for yourself, read on for some guidance on making the right decision every time.

The Psychology Behind Decision Making

Black or white? Bus or train? Pizza or pasta? Yes or no? These are types of regular decisions we all face in our lives.

While we are quick to make some decisions, others require more thought and careful consideration. An informed decision, for instance.

We make decisions by relying on our intuition and rational thinking, with the help of memories.

We often rely exclusively in one type or another for these processes.

Mental biases influence us when we think about what's most important.

Logic helps guide how much evidence should be required before making a decision (and sometimes even then some people will still question).

Emotions can motivate someone who needs an answer now rather than later this week.

But no single factor tells everything there is to say about why someone reaches certain conclusions after weighing all available options.

Therefore decision-making is a mixture of intuition and rational thinking.

Our human brain is not a single computer program but rather an interconnected system of different processors that work together to create the way you experience your world.

Your conscious and subconscious minds each have their own task, which means there's no one "you" – they're all influencing each other constantly.

The best approach is to follow a step-by-step strategy. We can utilise these strategies to ensure we all improve our decision-making skills.

Four Steps to Effective Decision Making

1.) Identify the problem that’s causing you to make a decision.

The first step towards better decision-making is to identify what problem causes you to make decisions.

When we are first presented with a problem, it can be difficult to see the issue clearly and identify the choices that need to be made in order to resolve the problem.

This is often because we are so close to the situation and may be emotionally attached to the outcome.

In these cases, it can be helpful to step back and look at the problem from a different perspective.

It would help if you analyse and list it down with a simple problem statement by filling in the blank: “The problem(s) I’m trying to solve is (are) [your answer(s)].”

By taking some time to analyse the situation, we can usually find a way to resolve the problem effectively.

Finally, ask yourself repeatedly why this is a problem until you land on an obvious answer.

2.) Gather some information and alternative options

When you are trying to make a decision, it is important to have a firm understanding of the issue at hand. Once you understand the issue, you can start to gather information.

It is a good rule of thumb to gather more information than you think you will need.

This way, you will have a better understanding of the situation and be able to make a better decision.

After you have gathered all of the information, you can start to parse through it and determine what is relevant and what is not.

This process can be difficult, but it is essential in order to make the best decision possible.

If you take the time to understand the issue and gather all of the relevant information, you will be able to make a decision that you can feel good about.

This may involve talking to someone who is impartial and can offer a fresh perspective. It can also be useful to brainstorm possible solutions and explore all of the options before making a decision.

When you have all the information, you can more accurately weigh the pros and cons of each option and make a decision based on what is best for you, not just what is available. 

Having all the information also allows you to negotiate from a position of strength, knowing what other options are available if the negotiation falls through.

After you have done your research, you will be able to identify some apparent alternatives to choose from. This will result in an informed decision.

3.) Weigh your options (pros and cons)

After you have brainstormed and found a few alternative paths that you think are valuable, it is important to objectively weigh the options using the evidence you’ve gathered.

Keep in mind the benefits and consequences of each alternative, and try to make a decision that will result in the most benefits overall.

For example, if you are trying to decide whether or not to take a new job, you will want to consider things like salary, commute, company culture, and growth potential.

It can be helpful to make a list of pros and cons for each option, or even to do a cost-benefit analysis.

Ultimately, the goal is to choose the path that seems most likely to result in positive outcomes.

4.) Act on that decision

Once you have gone through the decision-making process and have arrived at a course of action, it is essential that you follow through with it.

This can be difficult, especially if the decision was a difficult one, but it is important to remember that you went through the process for a reason.

If you find that you are struggling to follow through, it may be helpful to reassess your decision and consider whether or not it is still the best course of action.

It is also important to keep in mind that decisions are not always permanent, and you can always change course if necessary.

The most important thing is to make sure that you are making decisions that are best for you and that you are following through on those decisions.

Making sound and informed decisions is a key component of success in our professional lives. By understanding the psychology behind decision-making, we can take steps to make better choices.

If you would like help applying these principles to your own life or business, have a chat with us. Our team of experts are here to help you achieve your goals.