19 Decision Making Tools for Business

In life, we make decisions every day. And in the context of running a business, decision making gets even more serious in nature, as the resulting outcome would affect a whole organization, its performance, its direction, or its employees.

Following are visual decision making tools that you can use during different stages of decision making. Each tool is provided with an editable template that you can click and customize online during your decision making process.

Decision Making Tools to Streamline the Decision Making Steps

The decision making process helps business managers find solutions to problems by exploring the different options available and selecting the best alternative out of them.

These decision making tools will help you accelerate the process by simplifying each step of the process.

1. Explore the Situation and Gather Information

Before you make a decision, you need to examine the situation or the issue that requires you to make a decision, in the first place. See who is affected, what caused it, and how you should approach it.

Stakeholder Analysis

Using a stakeholder analysis you can see who you should involve in the decision-making process.

You might have to rely on other stakeholders for their input in making the decision, in which case it’s better to conduct a stakeholder analysis to identify who you should get help from.

Root Cause Analysis

Now you know who to involve in the decision-making, it’s time to understand the situation you are dealing with. Two tools that can help you with this are the fishbone diagram and the 5 whys analysis.

Both of these tools help in getting to the origin of an issue and finding the root cause of things.

• Fishbone diagram or the cause and effect diagram is great with helping you isolate the root cause of a problem. Here’s how you can use this tool to solve business problems.   

• 5 Whys Analysis helps you narrow down the information you have gathered and find the last few causes of your problem by asking ‘why’ 5 times.

PEST Analysis

You can use the PEST analysis to evaluate the external environment and its impact on a decision. Analyze the Political, Economic, Social, and Technological factors affecting the decision.

2. Find Effective Alternatives

Once you have an idea about the situation or the issue, it is easier to generate alternative approaches to finding a solution. You can use the following decision-making tools to explore your options individually or in groups.  

Mind Maps

Mind map is a powerful tool that helps you capture thoughts in your head or ideas thrown around during a group brainstorming session. You can also use it to categorize your options and further examine them by analyzing different related elements.

Pros and Cons List

The pros and cons list is a great tool for simple decision making scenarios. You can use it to list all the positive and negative aspects of each option to weigh them against each other.

Six Thinking Hats

Six thinking hats is another useful technique that provides direction to decision-making and group thinking.

It helps look at the situation you are analyzing from a range of perspectives and find alternative solutions from everyone involved.

Here’s how to use the six thinking hats technique.

Delphi Method

The Delphi Method is a process for reaching an agreement among experts. Experts answer questions in several rounds. After each round, their answers are summarized and shared with the group. Experts then review and adjust their answers based on the group’s feedback. This continues until the group agrees on the best answer.

Reframing Matrix

The reframing matrix is another tool that helps you look at business problems from a number of viewpoints.

It takes into consideration the different perspectives of several people with different experiences. This allows generating multiple creative solutions for the problem at hand.

You can use the 4 Ps approach when using the reframing matrix. When brainstorming solutions, look at the problem from these perspectives,

• Product perspective: Is there anything wrong with your product or service? With its quality or the estimated price? Does it fulfill the needs of the customers?
• Planning perspective: Is there anything wrong with your product plans, sales plans or marketing plans?
• People Perspective: Who are the people affected by the problem? What do they think?
• Potential Perspective: How can you increase the potential sales and marketing results? How can you boost productivity?  

Affinity Diagrams

Now that you have gathered a lot of information about the situation, you can use an affinity diagram to organize them into categories.

By doing so you and your team can quickly identify patterns or themes that will help analyze the situation easily.

3. Analyze Your Options

Now that you have come up with a number of different alternatives, it’s time to evaluate the desirability and the feasibility of the different options along with the risks that might be involved.

PMI Charts

This is a simple tool that you can use to evaluate the pluses, minuses and implications or the Interesting things involved with your options. By comparing these aspects of each alternative option, you can decide which one is the best.

Risk Analysis

Most decisions you have to take involve risks, that’s why you need to assess the risks involved with them before you go ahead. This way you can take precautions.

Check out our post on Risk Management Techniques to get an idea about the types of tools you can use to evaluate the risks associated with your decisions.  

Force Field Analysis

Force field analysis is another powerful decision making tool that helps identify and analyze the forces for and against change or the implementation of a proposed solution.

Check out our article on the force field analysis to learn how to use the tool. Also, check out our guide on change management tools to facilitate change management.

Cost-Benefit Analysis

The cost-benefit analysis is used  to compare the costs and benefits of different choices. You can identify all costs and benefits associated with each option, quantify them, and compare the net benefits with it.

Pareto Analysis

Pareto Analysis is a decision making tool used to identify the most significant factors in a dataset. Based on the Pareto Principle (also known as the 80/20 rule), it suggests that roughly 80% of effects come from 20% of causes. By focusing on these key causes, you can address the most impactful issues first.

Scenario Planning

Scenario analysis helps decision-makers make better choices by thinking about different possible futures and what they might mean. This way, they can be ready for whatever happens, making their decisions stronger and more adaptable, especially when things are uncertain and keep changing.

SWOT Analysis

SWOT analysis is used to analyze the internal factors such as strengths and weaknesses and external factors such as opportunities and threats affecting an organization.

You can use this decision making tool to analyze the strengths, weaknesses, opportunities, and threats related to your alternative options.

4. Select the Best Solution

Even after evaluating the desirability and the feasibility of the options, you might still end up with several good alternatives at hand. While you can apply a combination of them as your solution, this might not be practical all the time.

You can use the following decision making tools to decide which is the best option to move forward with.

Decision Trees

Decision tree diagram help visualize the alternative choices and every possible outcome related to them. It allows you to assess the value of outcomes and the possibilities of achieving them. This, in turn, helps make a better decision.

Learn about using the decision tree diagram maker in more detail here.

Eisenhower Matrix

When you have different tasks to execute and can’t decide which one to go ahead with, you can use the Eisenhower matrix to decide what is important or not and what is urgent or not.

It will help you make more productive decisions by eliminating options that do not help you accomplish your goals.

Flowchart

Flowcharts are considered to be a proven method for documenting processes, brainstorming, evaluating, and identifying the best alternative possible.

Below is an example of a typical flowchart used in decision-making. This would help us evaluate the consequences of each alternative.

What Other Decision Making Tools Do You Use?

Here we have covered several decision making tools that you can use during the different stages of decision making. Whether you are doing it alone or with the help of a group of stakeholders, you can rely on these decision-making methods to make well-informed decisions faster.

What other decision making tools do you use to solve problems and make business decisions? Do let us know in the comment section below.