The Importance of Decision Making in Understanding Organizational Behavior in Business
Nothing happens in any kind
of organization without decisions being made. Even the organization's very
existence would not be possible had someone not decided to start it. A person
makes thousands of decisions in varying degrees of importance every day, so
it's fairly easy to imagine how many decisions are made daily in a business.
They are continuous, with the results of one decision affecting the next one
and the next. Decisions are a vital part of society, yet people largely pay
them no mind until things get serious.
Nearly every decision counts
towards the success (or failure) of the business and the continued balance of
its organizational behavior. There are more types of decisions that are made in
a professional setting than one would expect, and the effects of being careless
or failing to think things through in making a decision can be quite
extraordinary. This article will explore the role and effects that decision
making has in business and organizational behavior, with a look at who really
has the final say.
How Decision Making
Works in Organizational Behavior
The way that decision making
works in a business setting can be quite similar to how it is in the personal
lives of the company's employees. In general, there is usually a problem in
need of a solution that needs to be addressed. The person making the decision
weights what options are available, considers the factors of the situation, and
chooses-to them-the best solution and applies it.1 Sometimes it
works, sometimes it doesn't. It is the application of the problem solving
skills you have been taught and have practiced throughout your entire life.
In business, some of the
decisions tend to require more in-depth contemplation due to their complexity
or the gravity of the situation. There's more to consider and the effect of the
potential outcome can extend beyond the decision maker, depending on what their
role is in the business.2 The role decisions have in organizational
behavior can cause the different aspects to shift one way or the other and
alter the dynamics amongst the staff. The clientele of the business can also be
directly and/or indirectly impacted by internal decision making. Depending on
the size of the company, decisions can carry some weight to them as there can
be hundreds or even thousands of people affected. With that in mind,
significant business decisions should be thoroughly thought through first.
Types of Decisions in
Not all decisions are the
same, beyond just their context. There are several different types of decisions
making that can be expected in a business. Some are, obviously, going to be
applicable in under certain circumstances and in certain roles. However, any
type can be present in a business and can therefore affect those associated
with it. A few of the types include:
that are strategic in nature tend to focus on what the next step is and what is
the best way to get there. These follow a specific process in order for the
outcome to be the most beneficial for the business and its agenda. Taking such
an approach involves the application of a formula of sorts to come to a viable
solution for the problem at hand and looking at as many of the options that are
available as possible.3 Strategic decisions usually require a some
degree of analysis and the ability to prioritize.
the basic, everyday decisions that are a dime-a-dozen in society. Some routine
decisions, however, may not seem so routine outside of the business. The
everyday in a professional sense is not going to be the same as it is for the
personal. A routine decision often is one that is made repeatedly and no longer
needs any prolonged deliberation for a person to reach a conclusion, even
though they might have in the beginning. Think of the habits that have developed
in your own job in relation to your decision making; you've done them enough
times that you really are not actively thinking about them when you act.
Impromptu vs Planned-Also
considered split-second or shooting from the hip decisions, impromptu decisions
are choices made in the heat of the moment. There usually isn't any time to
debate options and thoroughly analyze the situation. Compared to the
traditional planned decisions that most people face, you can't easily predict
what the outcome of your choice is going to be. There's roughly a 50% chance
that you're wrong. If you're right in your decision, then it may be chalked up
to luck or chance depending on the situation. Most of the time, the "big"
decisions in a business are going to be plannable and it's rare that the right
circumstances present themselves for a major decision to require an impromptu
response. IF that does happen, then it might signal that something is
very wrong in the business.
Policy, Administrative, and Executive4-These three are going to be made by those higher up in
the business' hierarchy, but will have a greater impact on the business as a
whole. They can shape the structure and actions of the company, directly impact
customers, and trickle down to affect the decisions made further down the
ranks. Policy-based decisions tend to be the most frequent of the three and
have the most noticeable effect since these are decisions that impact the
fundamental rules of the business. Administrative decisions are the ones most
associated with those in management. Occasionally, these have a more isolated
effect, such as firing someone or assigning tasks to a group. Executive
decisions are reserved for those at the very top and can override every
decision down to the bottom. They hold the most power in the business, which
can be very problematic if mishandled.
ethics will play a role in nearly every single decision made in a business,
there will be some that are focused on ethics. These typically include any
decisions that can directly impact the codes of conduct the business operates
on or those that may be restricted by legal or social ethics. There is usually
an option that leans towards "good" and one that leans towards "bad", with most
people instinctually selecting the good choice. While that's not always the
case, many people will often take their time in considering the problem at hand
before making their decision.
The Role and Impact
Ethics and decision making
often go hand in hand in the business world. A decision that violates ethical
standards can lead to significant backlash from the public and from the law.
The impact can be incredibly damaging for the business, and it may not be possible
to recover from the ramifications of not abiding by an ethical code. The
ethical standing of a person who is or may be in a position of power in a
business making can be a way for others to predict the outcomes of their
decisions, which can be a deciding factor in giving them that power in the
When a decision is made that
goes against the accepted ethics, there are often consequences that the person
and the business need to face. This is still the case when an ethical violation
was not the intention, as even carelessly made decisions can have ethical
consequences. If, say, an employee operating machinery in a factory chooses to
not follow all safety procedures out of laziness or to save some time, it could
be seen as an unethical decision because it has the potential to put people's
lives in danger. Those who are put in positions where they may have to make
serious decision need to be comfortable with and aware of the ethics of the
situations they may face.5
Who Has The Power?
Technically, everyone in the
company has the power to make or influence decisions and generate an impact on
the organizational behavior of the business. Each person is a functional,
independent part of the business, and they do have some control over what
effect they have through their particular role. However, certain positions have
more power than others and therefore their decisions can lead them to have more
control over the business. Someone who is in management, for example, will
certainly have more power than someone who is in an entry-level office position
at the same company.
The amount of power someone
has can certainly influence their decision making-the idea of a power trip is
one that many people are familiar with and have witnessed before. They can be
swayed by their personal views into acting more in their best interest and not
the business'. There is also the issue of workplace politics, which can
generate favoritism and unethical behavior.6 A person in a high
ranking position within a business could abuse their power and attempt to sway
a person's decision making towards their preference, even though they may not
have any official say in the matter.
While such things can be
problematic and even harmful to a business' organizational behavior, they do
happen. Prevention of such instances are usually done by having a system of
checks-and-balances built into organizational behavior and company polices. In
most democratic countries, this is how the different branches of the government
are intended to operate cohesively and effectively.
What Can Affect
Effective Decision Making?
There are sometimes so many
factors involved in making a decision that it can seem impossible to choose an
option. Many of these factors can shift a person's choice and guide them towards
a solution to their problem. While there are some factors that can be
beneficial in decision making, there are unfortunately obstacles that may make
things difficult. Several of the following obstacles may be more applicable to
certain situations than others, but they are common problems faced in decision
making in a business setting.
Perception Issues- A person's perception and attributions can
alter many of their actions. This can prove to be an issue if there is a
difference between what the person perceives and what the reality of the
situation is. For example, a manager that believes an employee is being lazy
when they're not may choose to reprimand them or give them a poor evaluation.
This can lead to conflict between the employee and the manager, especially if
it continues to impede the manager's decision making abilities.
who do not get along for whatever reason will often make their decisions in a
way that negatively impacts the other. In group work, this can lead to disorder
and prevent the task from being completed on time to the level of quality
required. Breakdowns in communication in a group setting can be caused by
decisions made due to the clashing personalities of team members.7 It's
reasons such as these that make it so important for management to be careful in
who they put together to work.
you're stressed, you're not thinking clearly and your decision making abilities
can be impeded. Stress is distracting and a person who is stressed out may not
be able to concentrate or consider the details of the situation they are faced
with in order to make an appropriate decision. Depending on how stressed out
they are, they may not even realize that they've made a mistake (or several)
until the consequences of their actions begin to make themselves fully known.
the reason why a person does not have all the necessary information to make a
sound decision is because of communication issues. Without the appropriate
facts, there may be an option that a person does not know about.8 In
teams, poor communication can impact individual decisions and decisions the
team makes as a whole. The execution of a decision once it's made can also be
impacted by communication issues, as the decision is sent further along the
chain of command. Think of the telephone game, where a phrase is whispered from
person to person and becomes distorted due to miscommunication and
misunderstandings. The same can occur in a business setting if people are not
care or paying attention.
Laws and Ethics-As
stated previously, there can be legal and ethical restrictions in decision
making that can cause a somewhat simple choice to become complex. It is the
responsibility of the person making the decision to follow these restrictions.
If they fail to, then it is their responsibility to deal with the
consequences-which may include jail and fines in serious circumstances.