What is the process of identifying and selecting course of action to solve specific problems?

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Robert Frost wrote, “Two roads diverged in a wood, and I—I took the one less traveled by, and that has made all the difference.” But unfortunately, not every decision is as simple as “Let’s just take this path and see where it goes,” especially when you’re making a decision related to your business.

Whether you manage a small team or are at the head of a large corporation, your success and the success of your company depend on you making the right decisions—and learning from the wrong decisions.

Use these decision-making process steps to help you make more profitable decisions. You'll be able to better prevent hasty decision-making and make more educated decisions.

The business decision-making process is a step-by-step process allowing professionals to solve problems by weighing evidence, examining alternatives, and choosing a path from there. This defined process also provides an opportunity, at the end, to review whether the decision was the right one.

7 decision-making process steps

Though there are many slight variations of the decision-making framework floating around on the Internet, in business textbooks, and in leadership presentations, professionals most commonly use these seven steps.

1. Identify the decision

To make a decision, you must first identify the problem you need to solve or the question you need to answer. Clearly define your decision. If you misidentify the problem to solve, or if the problem you’ve chosen is too broad, you’ll knock the decision train off the track before it even leaves the station.

If you need to achieve a specific goal from your decision, make it measurable and timely.

2. Gather relevant information

Once you have identified your decision, it’s time to gather the information relevant to that choice. Do an internal assessment, seeing where your organization has succeeded and failed in areas related to your decision. Also, seek information from external sources, including studies, market research, and, in some cases, evaluation from paid consultants.

Keep in mind, you can become bogged down by too much information and that might only complicate the process.

3. Identify the alternatives

With relevant information now at your fingertips, identify possible solutions to your problem. There is usually more than one option to consider when trying to meet a goal. For example, if your company is trying to gain more engagement on social media, your alternatives could include paid social advertisements, a change in your organic social media strategy, or a combination of the two.

4. Weigh the evidence

Once you have identified multiple alternatives, weigh the evidence for or against said alternatives. See what companies have done in the past to succeed in these areas, and take a good look at your organization’s own wins and losses. Identify potential pitfalls for each of your alternatives, and weigh those against the possible rewards.

5. Choose among alternatives

Here is the part of the decision-making process where you actually make the decision. Hopefully, you’ve identified and clarified what decision needs to be made, gathered all relevant information, and developed and considered the potential paths to take. You should be prepared to choose.

6. Take action

Once you’ve made your decision, act on it! Develop a plan to make your decision tangible and achievable. Develop a project plan related to your decision, and then assign tasks to your team. 

7. Review your decision

After a predetermined amount of time—which you defined in step one of the decision-making process—take an honest look back at your decision. Did you solve the problem? Did you answer the question? Did you meet your goals?

If so, take note of what worked for future reference. If not, learn from your mistakes as you begin the decision-making process again.

Tools for better decision-making

Depending on the decision, you might want to weigh evidence using a decision tree. The example below shows a company trying to determine whether to perform market testing before a product launch. The different branches record the probability of success and estimated payout so the company can see which option will bring in more revenue.

A decision matrix is another tool that can help you evaluate your options and make better decisions. Learn how to make a decision matrix and get started quickly with the template below. 

You can also create a classic pros-and-cons list, and clearly highlight whether your options meet necessary criteria or whether they pose too high of a risk.

With these 7 steps we've outlined, plus some tools to get you started, you will be able to make more informed decisions faster. 

Explore additional strategies to help with your decision-making process.

Quality Glossary Definition: Problem solving

Problem solving is the act of defining a problem; determining the cause of the problem; identifying, prioritizing, and selecting alternatives for a solution; and implementing a solution.

• The problem-solving process
• Problem solving resources

Problem Solving Chart

The Problem-Solving Process

In order to effectively manage and run a successful organization, leadership must guide their employees and develop problem-solving techniques. Finding a suitable solution for issues can be accomplished by following the basic four-step problem-solving process and methodology outlined below.

1. Define the problem

Diagnose the situation so that your focus is on the problem, not just its symptoms. Helpful problem-solving techniques include using flowcharts to identify the expected steps of a process and cause-and-effect diagrams to define and analyze root causes.

The sections below help explain key problem-solving steps. These steps support the involvement of interested parties, the use of factual information, comparison of expectations to reality, and a focus on root causes of a problem. You should begin by:

• Reviewing and documenting how processes currently work (i.e., who does what, with what information, using what tools, communicating with what organizations and individuals, in what time frame, using what format).
• Evaluating the possible impact of new tools and revised policies in the development of your "what should be" model.

2. Generate alternative solutions

Postpone the selection of one solution until several problem-solving alternatives have been proposed. Considering multiple alternatives can significantly enhance the value of your ideal solution. Once you have decided on the "what should be" model, this target standard becomes the basis for developing a road map for investigating alternatives. Brainstorming and team problem-solving techniques are both useful tools in this stage of problem solving.

Many alternative solutions to the problem should be generated before final evaluation. A common mistake in problem solving is that alternatives are evaluated as they are proposed, so the first acceptable solution is chosen, even if it’s not the best fit. If we focus on trying to get the results we want, we miss the potential for learning something new that will allow for real improvement in the problem-solving process.

3. Evaluate and select an alternative

Skilled problem solvers use a series of considerations when selecting the best alternative. They consider the extent to which:

• A particular alternative will solve the problem without causing other unanticipated problems.
• All the individuals involved will accept the alternative.
• Implementation of the alternative is likely.
• The alternative fits within the organizational constraints.

4. Implement and follow up on the solution

Leaders may be called upon to direct others to implement the solution, "sell" the solution, or facilitate the implementation with the help of others. Involving others in the implementation is an effective way to gain buy-in and support and minimize resistance to subsequent changes.

Regardless of how the solution is rolled out, feedback channels should be built into the implementation. This allows for continuous monitoring and testing of actual events against expectations. Problem solving, and the techniques used to gain clarity, are most effective if the solution remains in place and is updated to respond to future changes.

Problem Solving Resources

You can also search articles, case studies, and publications for problem solving resources.

Books

Innovative Business Management Using TRIZ

Introduction To 8D Problem Solving: Including Practical Applications and Examples

The Quality Toolbox

Root Cause Analysis: The Core of Problem Solving and Corrective Action

Articles

One Good Idea: Some Sage Advice (Quality Progress) The person with the problem just wants it to go away quickly, and the problem-solvers also want to resolve it in as little time as possible because they have other responsibilities. Whatever the urgency, effective problem-solvers have the self-discipline to develop a complete description of the problem.

Diagnostic Quality Problem Solving: A Conceptual Framework And Six Strategies (Quality Management Journal) This paper contributes a conceptual framework for the generic process of diagnosis in quality problem solving by identifying its activities and how they are related.

Weathering The Storm (Quality Progress) Even in the most contentious circumstances, this approach describes how to sustain customer-supplier relationships during high-stakes problem solving situations to actually enhance customer-supplier relationships.

The Right Questions (Quality Progress) All problem solving begins with a problem description. Make the most of problem solving by asking effective questions.

Solving the Problem (Quality Progress) Brush up on your problem-solving skills and address the primary issues with these seven methods.

Case Studies

Refreshing Louisville Metro’s Problem-Solving System (Journal for Quality and Participation) Organization-wide transformation can be tricky, especially when it comes to sustaining any progress made over time. In Louisville Metro, a government organization based in Kentucky, many strategies were used to enact and sustain meaningful transformation.

Certification

Quality Improvement Associate Certification--CQIA

Courses

Certified Quality Improvement Associate Question Bank

Lean Problem-Solving Tools

Problem Solving Using A3

Root Cause Analysis: Solve Problems by Eliminations Causes

Quality 101

Webcasts

Making the Connection In this exclusive QP webcast, Jack ReVelle, ASQ Fellow and author, shares how quality tools can be combined to create a powerful problem-solving force.

Adapted from The Executive Guide to Improvement and Change, ASQ Quality Press.