Mitigating organizational decision making amidst the dragging effect

Correspondence: papers@team.qeios.com — Qeios will forward to the authors

Introduction

The competitive and rapidly changing nature of the modern organizational environment necessitates quick decision-making on the part of managers. An organization’s performance can be significantly impacted by how it handles and processes thousands of decisions it makes every day. In an administrative perspective, decision-making is seen as the foundation of any organization because it is the source of all other activities. Thus, making decisions is the most important component and the main action in every organization's operation (Kumar &Gautam, 2018). It is what motivates all efforts and actions in an organization (Al-Ghamdi, 2015).It is regarded as the core responsibility of management (Al-Khamis, 2011). It acts as an axis for additional management procedures (Bursalıoğlu, 2013).

Executives and leaders make a variety of decisions every day that involve the sharing of information, the analysis of data, the development of fresh ideas, the assessment of various courses of action, and the implementation of policies (Chandra, 2010). Decisions must be made by administrators in order to carry out their everyday tasks (Khasawneh, Alomari, & Abu-tineh, 2011).When sound, high-quality decision-making is ingrained throughout the entire organization, its capacity to make decisions that are efficient and effective can be realized. This is so that the organization can continue to exist (Bursalıoğlu, 2011).Therefore, the most important procedure in any firm is the corporate decision-making process. (Emma Butterfield, March, 2016). Decisions made by the organization have an effect on stakeholders and employees. (Negulescu, 2014). Because of this, the effectiveness of the decisions and their relevance to the goals of an organization are essential to the long-term viability of its mandate (Secchi, 2011). Decision-making through several alternatives is geared towards achieving the desired results (EsmailiandAzizi Nejad, 2021). Because the results are foreseeable, it is considered that administrative decision-making is reasonable (Ngussa and Gabriel, 2017).

Organizational decision making

A decision is a course of action based on the process of defining options (Certel et al., 2013), selecting the most logical viewpoint or alternative from a range of viewpoints regarding a subject (Gonzalez &Dutt, 2016; Shahid, Rappon, & Berta, 2019) and making a judgment (Kunsch, 2014), in order to achieve the desired outcomes (Şişman, 2010).It is a behavior that demonstrates how a person defines and approaches a problem (Bratton, Callinan, Forshaw, & Sawchuk, 2007), and select an alternative solution to resolve it (Aboudahr & Olowoselu, 2018). Making decisions can also be seen as a process of forming preferences among alternatives, selecting and carrying out an action, experiencing the outcome, and assessing it. (Ernst & Paulus, 2005).

It is clear from the varied definitions that making decisions is a combination of art and science. It can be as basic as tossing a coin or a highly structured analytical process. `Decision-making is a significant management process (Lunenburg, 2010a) and stands out as one of the most critical responsibilities of managers (Atsan, 2017, 2001). Making decisions in an organizational context requires good judgement and diagnostic skills (Donovan, Guess, & Naslund, 2015). Judgments should have a variety of features given that managers make a number of decisions throughout the course of a day (Dowling, 2000). Additionally, the organizational management must genuinely work to improve the general effectiveness and caliber of the decision-making procedures.

The way decisions are made affects how an activity is mobilized and how they can support or hinder an action (Brunsson, 2007). However, managers in all organizations encounter challenges that prevent them from making high-quality decisions, including rapidly evolving futures, shifting laws and regulations, advances in technology, uncertainty, a lack of information, and a lack of critical resources. In this regard the ability to evaluate results rationally is hampered by change itself (Efimov, 2013).Data demonstrates that, despite managers' best efforts to advance an organization's vision by making decisions with those objectives in mind, the majority of decisions are still made in the absence of sufficient knowledge and with insufficient resources (Negulescu, 2014).

While some organizations employ qualitative and quantitative methodologies to forecast the outcome of potential situations, some organizations use the quality management framework as a decision-making tool (Negulescu, 2014).Generally speaking, a decision maker's values, knowledge, and preferences are what guide their choices (Shaked and Schechter (2019). Although the manager has the ability and responsibility to make decisions, the organization should involve others who may be impacted by those decisions in the decision-making process (Taymaz, 2003).The management must give it specialized, organized, and timely attention and action (Durai, 2015).

Nature of decisions in organizations

Organizations should be designed to best achieve their objectives since they are perceived to be networks of decisions (Güçlü, Özer, Kurt & Koşar, 2015). While some decisions are normal and well-known, others are novel and challenging. In whichever way, the organization's end outcomes are the focus of the managers' efforts (Fred and Lunenburg (2010). Every organization makes a number of judgments that are really diverse (Emma Butterfield, 2016). This naturally means that there are many different types of decisions, some important, others not so important, others made frequently or perhaps occasionally (Dimkovska, 2016).

Structured decisions are the Regular and recurrent decisions that may be handled correctly and effectively by decision-makers by following a predetermined process (Akın, 2015). Semi-structured choices are made when only a piece of the issue has an evident answer provided by a recognized procedure (Ployhart, & Moliterno, 2011). Unstructured decisions are defined as novel, irregular, and highly uncertain decisions. In another perspective, decisions can be adaptive or maladaptive (Fang, Hsu, and Lin, 2019). Maladaptive involves panic, evasiveness, and complacency while adaptive is linked to a moderate degree of psychological stress and promotes wise and logical decision-making (Tuinstra, van Sonderen, Groothoff, van den Heuvel, & Post, 2000). Alternatively, decision-making may be viewed as authoritarian or democratic (Vroom, 2000) or decentralized and centralized decision-making. In this case, centralized decision-making is what has led to a reduction in creativity, innovation, and quality (Karmila &Wijaya, 2020).

Organizations also make strategic decisions. Decisions about strategy have an impact on organizational goals, objectives, and other crucial policy issues (Negulescu, 2014). These choices typically entail large financial or investment commitments (Zell, Glassman, & Duron, 2007). Strategic decisions in this regard are typically made using a top-down approach, but they must be supported by data or information that comes from the functional level (Makridakis and Hibon, 2000).Policy decisions are equally important because they involve organization's numerous policy issues. These decisions are made by the top management and affect how the organization operates in the long run (Conlin, 2007). Finally, operating decisions are those that affect how a business runs on a daily basis (Ireland, & Miller, 2004).

Despite the many types of decisions, there are numerous criteria for division and branching species of decisions. Thus, repetitive functions—often associated with an organization's daily operations—are related to programed decisions (Hussien Ahmad Al-Tarawneh, 2012). Non-programmed decisions are frequently made in unexpected or sudden situations (Quinn, 2010). These judgments are unique and involve uncertainty (Verma (2014). It is significant to note that effectiveness of an organization is significantly impacted by the decision-making structure that is selected, whether that be pooling individual decisions or delegating them to experts (Cihangiroğlu, Uzuntarla, Özata, 2015).

Understanding, adopting, and more successfully executing decisions all depend on participation in the decision-making process (Taymaz, 2003).Encouragement of employees to engage in decision-making by managers is essential (Al-Hourani, 2013; Al-Khamis, 2011).Low levels of employee participation may have detrimental effects on some individual and organizational results (Demirtaş and Alanoğlu, 2015). Any organization can assign responsibilities to assistant administrators and integrate them into the organizational process with the aid of decentralized decision-making (Sobotkiewicz, 2014).Making decisions involves a diverse range of dynamic processes (D’Angelo, 2011), frequently needing the involvement of numerous stakeholders, not just the management, and a collection of unique traits and tactics (Eranova &Prashantham, 2016).

Barriers to good decision making

Many organizations frequently encounter intriguing difficulties in decision-making caused by their own or the organization's indifference. In the same vain, they encounter numerous obstacles and hurdles as they seek to make wise judgments. This implies that decisions can be expressed as gains or losses or as a benchmark by which the various possibilities can be measured (Dowling, 2000). Evidence shows that decisions are frequently made without the required knowledge and resources (Negulescu, 2014). Majority of decisions by managers, according to research, are not based on scientific methods or decision-making tools, but rather on historical occurrences and past experiences (Negulescu, 2014)

Despite the many years of research on decision-making, decisions in organizations frequently go wrong (Nutt, 2002). The ability of an organization to make important decisions might be helped or hindered by certain factors. It is crucial that managers take into account as many of these elements as possible when making decisions. There is always a background for every decision made and that has a significant impact on how decisions are made. It is important to look at both the organizational structure and culture (French and RioosInsua, 2000).Organizational decisions may be made under certain, uncertain, and dangerous circumstances because the environment is always changing and the knowledge is not always complete and readily available (Dragomir, 2012). This encourages management choices to be made while taking into account both internal and external environmental restrictions (Jungwon Park & Keon-Hyung Lee, 2020).

Making decisions that have some degree of ambiguity requires the decision maker to have faith in their judgment. The conviction in one's capacity to achieve goals that result in favorable results for oneself and others is characterized as self-confidence in decision-making (Bearden, Hardesty, & Rose, 2001).However, there are situations when the decision-mindset maker's rather than the decision-making process is to blame. The way the human brain functions can undermine our judgment (Obi, 2014).Contextual elements that influence decision-making include the degree of ambiguity, dynamic settings that are constantly changing, and conflicting aims and values (Nixon,2017).

Decision-making can be influenced by various emotions in various ways. Consistently high levels of anxiety have a deleterious impact on decision-making (Bachkirov (2015). In addition, psychological biases can also influence how decisions are made. Managers typically permit their subjective prejudices to obstruct their ability to make rational decisions (Clemenand Reilly, 2001). Managers are not immune to the "illusion of control." In essence, this means that managers start to believe they have some control over results even when they don't. Such exaggerated confidence can be quite hazardous when making decisions, especially when a crucial strategic choice is at stake (Edwards, Miles, and von Winterfeldt, 2007). These internalized influences may include, but are not limited to, gender, culture, self-awareness, (Craft, 2013) acting with intention, personal philosophy, and moral judgment (Dawson and Napper, 2020).

Decision-making is also rife with political conduct, which frequently degrades the quality of decisions and harms organizational performance (Al-Yahya, 2008). Every organization has internal and indisputable organizational politics (Cheng, Wang, & Zhang,2011).By applying and acknowledging the concepts of Politics, Ego, Emotions, and Money, effective leaders may lessen the difficulties that come with making decisions (Debman, 2006).Due to the speed at which knowledge is shared and how swiftly the world is changing, yesterday's information is quickly obsolete. Change presents serious problems to leaders in terms of decision-making (Bolman and Deal, 2001). In other words, if a leader was embroiled in a political, egotistical, or emotional conflict with another individual or group, they might not be able to get the knowledge they need to make a more wise choice. Trusting a bad decision based on preconceived beliefs is one of the most frequent mistakes that leaders and managers make (Morse, 2016)

Achieving Quality organizational decisions

The essential factor in determining whether organizational management is successful or unsuccessful is the caliber and speed of decision-making. The quality of decision-making depends on clearly defining the goals, offering choices for resolving issues, and considering and balancing values and interests. According to literature, decision quality can be attained by taking environmental conditions and the organization's strategic strategy into account (Negulescu, 2014). The resources of an organization will be impacted by the effective application of foresight techniques. The resources that are available, their characteristics, and how they affect decision-making must all be taken into account. (Iain M. Boyle, 2012).

Any organization's performance is largely reliant on the caliber of the judgments made by its managers (Jabeen & Akhtar, n.d). To enhance their ability to make decisions, managers must understand how these aspects affect and play a part in that process (Durai, 2015).Today’s organizations are embracing concepts like foresight, which employs trend analysis, change driver identification, and road mapping as tools for decision making. These decision support tools help in the development of potential scenarios that may be controlled and modified to increase the likelihood that they will occur. Foresight is used to map potential future trajectories that will result in business opportunities in operations and strategic decision-making (Calof, 2012). The exercise of foresight typically entails Delphi methods.

In making quality decisions, analytical techniques can be utilized. In these techniques, the scenarios are ranked in order of importance, and then roadmaps are created to determine the optimum path to value-adding activities. Accordingly, the Mintzberg and Carnegie decision-making models are used by some practitioners of foresight (Guemes, 2013). These models appear to complement one another effectively because they encourage widespread participation and reduce uncertainty, which results in better decision-making (Fabbri, 2016). Additionally, multiple decision-making approaches can be used in the same circumstance or setting depending on the decision-makers' values, attitudes toward risk, and expectations for the future (Rachmatullah, & Ha, 2019).

It is also significant to note that a leader's professional experience helps them make better decisions in these scenarios since they may have gained practice in a situation similar to this one (Gresch, Hasselhorn, & Bögeholz, 2013). Making better decisions is facilitated by recognizing values and trade-offs as well as by using sound logic. Organizational leaders must have faith in their capacity to make difficult judgments, particularly when there are no established standards for what is morally "good" or "wrong." (Kanter, 2006). In this case, they make decisions based on their own worldviews, but if they can work with incorporating opposing viewpoints for a more collaborative decision-making process. It is therefore imperative that leaders exercise boldness, prudence, inventiveness, rationality, and balance of judgment. These abilities affect decision-making quality, which in turn influences organizational effectiveness.

Conclusion

In actuality, decision-making is still a challenging process, and organizational management must implement some tactics to make things simpler and the decision-making process more efficient. Each organization deals with a number of internal and external variables that either directly or indirectly affect decision-making in many cases. The key obstacles to making a choice that advances the organization's strategic goal include a lack of information, shifting priorities, and the influence of resources on choice. The effectiveness of decisions is impacted by the connection between uncertainty and available resources. Organizational management must therefore genuinely work to improve the general effectiveness and caliber of the decision-making procedures. Thus, the success of any organization decisions significantly relies on the capacity to foresee potential outcomes. In this case, foresight planning ie essential. Numerous choice approaches may also be applied in the same situation or context depending on the beliefs, attitudes toward risk, and predictions of future outcomes of the decision makers.

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