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December 06, 2023

The art of decision-making in management

Project Management Resource Management
Agnieszka Sienkiewicz

Should I allocate this resource to task A or task B? Is the initial schedule feasible? Which candidate is more suitable for the position?

As a manager, you make decisions all the time. And the greater the scope of your duties and the number of people you manage, the more effort you must put into choosing the most beneficial option. Or, as is the case in more dire scenarios, picking the least harmful ones.

But do you really know how to make the right choice? — the choice that would meet organizational goals and objectives?

This blog post will uncover the key steps you need to take in order to make an effective decision. You’ll also learn how BigPicture can aid you in the decision-making process.

Effective decision-making process steps for managers

Every day, an adult makes up to 35,000 decisions. This number is significantly higher when one supervises teams and other people’s work. But regardless of context, in the end, “every decision is a risk-taking judgment,” as per Peter Drucker — you take a risk and hope it will pay off by leading you to a successful outcome.

You can minimize that risk by following the sequential thought and action process to help you make more rational and informed decisions. Over time, you’ll likely improve the process we’re about to discuss or even develop your own. But having a basic framework to build on will help you hit the ground running.

The eight steps in the decision-making process.

#1. Establish objectives

When it comes to decision-making in management, you want to first clarify your organization’s objectives with respect to the decision you need to make. It means determining specific goals you need to meet within a specific period. This will help you align your decision with the direction your organization wants to follow. In other words, the goal you’ll achieve by making a decision later on should support the bigger goal set by your organization.

For example, one of the objectives your organization wants to tackle is high employee turnover. As a manager of several Agile teams, you want your decision to directly contribute to the increase in job satisfaction among your team members.

#2. Define the real problem

Einstein is quoted saying, “If I had an hour to solve a problem, I’d spend 55 minutes thinking about the problem and five minutes thinking about solutions.”

You realize you’re facing a managerial problem and must decide how to solve it. So first, you want to understand the problem or issue in detail. This way, you’ll know what your decision entails. If the issue is complex, break it down into smaller components, which you can analyze and solve individually.

For example, the main reason behind employee turnover is regular crunch time kicking in the second half of the project development lifecycle. You want to find out why such a situation happens in the first place.

#3. Gather information

The next step is information gathering. You need to know what information will help you decide and how to get it (and from whom). At this point, don’t limit yourself to internal resources like PPM software or your co-workers. Depending on the nature of your decision, you might also need to ask in relevant forums, check professional literature, or draft and analyze reports.

For example, having learned about the crunch time issue, you investigate why teams are overburdened close to the project deadline. 

You may use BigPicture’s Reports module to get insights into various Agile metrics and project data, including team velocity and plan delays. Those reports can also help you improve Agile planning and create more realistic schedules. On the other hand, the Resources module will show you exactly who and when is under-or-overallocated and what tasks are causing that.

Here, Rocco’s workload is grossly chaotic. In week 40, he can take 12 hours more. In week 41, his workload is fair (only 3.6 hours under his maximum capacity). While in week 43, he has 4.3 hours exceeding his capacity.

#4. Simulate and evaluate alternatives

Decision-making in management involves producing potential solution alternatives that you can later evaluate and choose the best one. But before that happens, you might want first to simulate the outcome of each possible alternative.

For example, to address the issue with resource overallocation, you can work on your project schedule in a safe environment using BigPicture’s what-if scenarios. The scenario mode is also suitable when you want to carry out resource capacity planning. You can then analyze the outcomes of each simulation and decide on the most feasible one (alternative).

Scenario mode in BigPicture is a safe and efficient way to test different solutions and choose the best one.

Cautious note: be diligent in your research, but try not to overthink your options too much or spend too much time gathering data. Otherwise, you might get stuck in analysis paralysis, which will burden your decision-making process.

#5. Weigh the evidence

To weigh the evidence means looking at the alternatives you’ve identified in the previous step and prioritizing them based on efficiency. To successfully complete this step, you need to find a parameter to measure. This way, you’ll be able to compare your alternative choices and see which one has a higher potential to help you reach your goal. 

Alternatively, you can list the pros and cons, conduct a SWOT analysis, or visualize your choices in the decision matrix. If there was no need to conduct an extensive search for alternatives, you’d knowingly be limiting your options to a set of alternatives that meet your minimum threshold.

#6. Choose the best alternative

Choosing the best solution out of those you’ve generated in the previous step actually means making a decision. You might opt for the alternative that has ranked highest on your list; combine several alternatives (if possible) to shape an even more powerful solution; or settle for the best possible decision within the constraints of your project, like time, resources, budget, and information available.

#7. Implement the decision

Decision-making in management is a mix of science, art, and action. One of the last steps in the process is decision implementation. If needed, develop an implementation plan outlining all the steps your team should take to achieve a goal. Afterward, you’ll be able to track its effectiveness and determine whether it got you closer to achieving your goal.

#8. Evaluate and review the decision  

If your decision has been generating outcomes for some time, then you can measure its impact and effectiveness. Did your decision make a difference? And above all, did it solve the problem as you anticipated?

Keep in mind that some issues are difficult to solve in one go. So, perhaps the decision you’ve made requires you to introduce a few tweaks iteratively. Instead of implementing a whole new solution again, what you can do is collect feedback and continue to improve on the one you’ve already implemented.

Decision-making in management: Summary

Decision-making, both in management and beyond, is a cyclical step-by-step process. It allows you to solve problems by identifying the issue in question, researching and weighing evidence, examining alternatives, and choosing the best (or “good enough”) solution. Once you reach a conclusion as to which alternative to implement, you need to track and evaluate its effectiveness. 

In many cases, the BigPicture PPM app will help you identify the problem, research and try various solutions, and track your post-implementation results. If you want to learn more about how BigPicture can help you, sign up for a 30-day free trial or join our live demo webinar. It’s a fantastic opportunity to see why more than 20,000 PPMs and their teams trust our software to build amazing products.