Why are decision-making styles important?
It’s critical to comprehend your decision-making process whether you’re managing a team, a business, or yourself. Knowing this will enable you to determine whether another approach might be more appropriate for your career or a particular circumstance.
Practicing good decision-making can improve your leadership qualities. Knowing the four decision-making processes will help you comprehend your own method and spot other people’s decision-making in the workplace. Knowing your own decisive style will help you manage situations’ outcomes when you have to offer a solution.
4 types of decision-making styles
A task or social focus, as well as a high or low tolerance for ambiguity, distinguish each decision-making style. In order to reach a conclusion, styles with a high tolerance for ambiguity can work with unknowable variables. Those with a low threshold for ambiguity seek the greatest amount of clarity in all the circumstances and facts that inform their decisions.
Decision-making styles also vary in a social- or task-driven focus. Socially motivated choices take into account how other people’s actions will affect the result. People who are task-driven decide how to accomplish a task in the most effective way.
Here are the four types of decision-making and some workplace applications for each:
1. Directive
Example: After a 90-day trial period, the company’s stockholders have decided to extend the 401(k) option to all current employees as well as new hires. The CEO must now choose whether the business will match employee contributions to their 401(k) funds. She considers how this might assist in luring top talent to join their team.
The CEO considers how money set aside for another project might be used to match employee contributions as she studies the budget projections she just created. She decides that the company will match 4% of employee contributions to their funds.
2. Analytical
Example: A sports broadcasting company’s marketing department is tasked with figuring out how to expand the audience for their current advertising campaign. The marketing manager requests that each team leader submit a report detailing the campaign they were a part of, along with the numbers for each audience demographic. They read each report then meet with the team leads. Following the meeting, the marketing manager chooses to invest in additional add space on social media platforms for the following 30 days.
3. Conceptual
Conceptual decision-makers anticipate possible outcomes before making a choice. They draw their conclusions by imagining various possibilities and outcomes for the future. Theyre strong in making long-term decisions.
For illustration, Joe’s new retail business is doing well in its first year. He considers how the business might expand nationally over the following five years. He chooses to establish a new store branch at the location when construction on a new shopping development in a major nearby city begins. Joe is confident his team will be successful despite the risk involved in opening this new store, and that this will help launch their brand nationally.
4. Behavioral
Example: Kate, the HR manager, must choose which week employees will receive bonus paid vacation days before the year ends. To find out how her employees feel about three potential dates, she sends out an email survey. Over lunch, she solicits feedback from her coworkers after reading the survey responses. Later in the day, she visits with more workers as she strolls through the office.
When she chooses the week that the majority of her coworkers prefer, she speaks with a few of them to see how they feel about the decision before deciding on it. She notifies management and staff at the end of the day which week will be bonus paid vacation time.
Decision-Making Styles
FAQ
What are the 5 decision-making styles?
- Analytical.
- Directive.
- Conceptual.
- Behavioral.
What are 3 types of decision-making?
Authors of the study Dan Lovallo and Olivier Sibony identified five decision-making styles after carefully examining 1,021 of the responses. They are: Visionary, Guardian, Motivator, Flexible, and Catalyst.
What are the 7 types of decision-making?
At the most fundamental level, we have decided to divide decisions into three main categories: personal, business, and consumer decisions.
