What is Effective Decision? | Credit Management

The most important activity underlying all functions of management such as planning, organizing, executing and controlling is “decision making”. A manager is a person who makes decisions and whose decisions are implemented by his subordinates. Then What is Effective Decision?

The effectiveness of a decision can be defined as the degree to which desired goals are achieved, how efficient they are in achieving those goals, and whether it leads to positive, valuable by-products.

Two different dimensions gain importance in determining the effectiveness of a decision. These:

  1. The “Quality” dimension of the decision
  2. It is the “Adoption” dimension of the decision.

Qualification : It covers the completely impartial and objective elements of the decision. It is based on objective data in the location.
Adoption: It is related to the feelings of the people and expresses how much the people who will implement the decision like it.

What is Effective Decision?

The quality and weight of adoption in decisions can vary from problem to problem. For example, if the execution of a decision is not dependent on individuals, the importance of adoption will decrease, and if personal attitudes affect the implementation of the decision, the weight of adoption will increase. Although it is necessary to give more weight to quality in the first type of problems and to adoption in the second type of problems, it is generally thought that high both quality and adoption will increase the effectiveness of the decision.

Traditionally, managers have emphasized the quality dimension; After collecting and reviewing the data about the problem, they made the final decision themselves. This is based on the assumption that there is a correct solution to the problem, a single most correct decision.

Managers who focus on the quality dimension have used the following methods.

Forcing the decision to be enforced by the subordinates who will implement it

“Adoption” expresses the appreciation of the people who will implement the decision.

  • To adopt the role of “father” by arousing feelings such as loyalty, trust and duty,
  • To persuade by stating the good, correct and beneficial aspects of the decision.
  • To use the consultation method in which the final decision is left to the manager by allowing the subordinates to discuss in the implementation of the decisions.

This ranking shows that the methods used to achieve adoption are evolving, but managers insist on retaining the final decision-making power. Therefore, the change in the methods used to ensure adoption cannot achieve the desired level of adoption.

There is a conflict between the methods used to raise quality and adoption. While trying to keep the quality high, the quality of the decision decreases while trying to increase the level of adoption. The way to eliminate this contradiction will be to examine the types of problems faced by the managers and to find solutions accordingly.

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