Decision-making According to Peter Drucker

Decision-making and Valuation

Best Practices
Donato ochan Hakim
CEO, South Sudan

Decision-making According to Peter Drucker

Definition of a Decision
A decision is a choice whereby a person performs a conclusion about a situation. This represents a course of behavior about what must or what must not be done. It is the point at which plans, policies and objectives are translated into concrete actions. Planning leads to decisions guided by company policy and objectives and implies the selection from alternative objectives, policies, procedures and programmes.
Peter Drucker
The purpose of decision-making
With decision-making we try to direct human behavior towards a future goal. If there were no alternatives, there would be no need for a decision.

Types of Decision-making
Drucker distinguishes between:
- Tactical decisions and strategic decisions. Strategy can be defined as the behavior of management in trying to achieve success for company goals in an environment of competition. It is based upon the action, or possible action of others. Strategies are solely calculated to implement plans and objectives, bearing in mind all manner of uncertainties, so that an advantageous position is attained over an opponent.
‘Tactical’ decisions are made by management and involve ‘either finding out what the resources are, or what they should be’. These include decisions upon basic objectives and may affect the productivity, organization or operation of the business.
- Organizational decisions and personal decisions. Organizational decisions are those made in the role on an official of the company and reflect company policy.
Personal decisions refer to those made by a manager as an individual and cannot be delegated.
- Basic decisions and routine decisions. Basic decisions are long-range in scope e.g. the location of a factory in development area, or deciding what product to make. Wrong decisions on these matters can be costly. Routine decisions are those which are made repetitively and need little thought.

The process of decision making.
For a proper decision to be reached the following steps must be followed:
• Define the problem to solved
• Find alternative solutions
• Analyse and compare these alternatives
• Select the plan to be followed noting relevant factors
• Make the decision effective – by taking action to put the decision into effect

Influences on Decision-making
It should be noted that, whatever decision criteria are chosen, decisions are affected by:
• The importance of the decision;
• Characteristics of the organization;
• The personality of the decision maker
• His/her state of mind when making the decision

  McCallum
Accountant, Australia
 

Decision Making is also Impacted by Emotions

Decision making is impacted by emotions and the personality of the decision maker. For example many people admit that un...

  V SHRIDHAR
Consultant, India
 

Factors Influencing Decision Making

Consciousness plays an important part in decision making. According to my experience decision making is affected by expe...

  DR SAJAL SEN
Management Consultant, India
 

Decision Making According to Peter Drucker

The decision making is impacted by emotions when we do not take the decision support tools into account. I feel a decisi...

  Malik Iqbal Kabir
Bangladesh
 

The Significance of Proper Problem Definition

I agree with Drucker that we need to be assured that before any decision making we should know what's the real problem i...

  Anand H
 

Organizational Decision Making Processes

Organizational decision making is a process... But it's a challenge when there are multiple outcomes and dynamic varia...

  vp unnikrishnan Menon
HR Consultant, India
 

Emotion as a Factor in Decision Making

There is an emotional dimension in decision-making, no doubt. The decision maker can intelligently utilize his emotions ...

  Rev. Matthias A. Idyu
Student (University)
 

Decision-making According to Peter Drucker

Decision-making in any organization is paramount and necessary. Decision-making is very critical at all levels of orga...

  Anthony
Consultant, Malaysia
 

Fact-based Decision Making Reduces Risk

Emotion does play a part in the decisions that we make. But if facts and data are used (for example using business intel...

  Ivan Kohlinsky
Management Consultant, United Kingdom
 

Problem Defining Stage in Decision Making

@Malik Iqbal Kabir : as regards to 'defining the problem', systems thinkers would say that one should look at the proble...

  eugenio bastianon
Professor, Italy
 

Selecting the proper Amount of Information in Organizational Decision Making

The search of Shannon (The Mathematical Theory of Communication, 1949) on measuring the amount of information is essenti...

  Bernhard Schleidt
Student (MBA)
 

The Importance of Timing when Making a Decision

One aspect of decision making has been neglected so far: WHEN is the decision required to be effective? (Editor: compare...

  Julius Nyangaga
Consultant, Kenya
 

Short Term Decisions are More Prone to Errors

- Long term decisions can be taken through a structural process, where it is easy to demonstrate the options there were ...

  DD Chhaya
Coach, India
 

Objective Decision Making is a Product of the Subjective Mind

@Dr Sajal Sen: objective is a product of the subjective mind! In order to have objectivity, the subjective mind of the d...

  Deepti Choudhary
HR Consultant, India
 

Decision Making Must be Rational

Decision makers should base their decisions basis relevant facts and logical evaluation of alternatives. We need rationa...

  kvssiyer
Consultant, India
 

Decision Making According to Peter Drucker

Decision making is a choice of one alternative amongst a set of choices available. The pros and cons of or consequence...

  WALTER Pascal, France
 

Decision Making According to Peter Drucker

Even if there are no alternatives, there is a need for a decision: to solve the problem or to let it and make no decisio...

  Abel Ogundeji
Consultant
 

Decision Making According to Peter Drucker is Useful for African Leaders

African leaders should learn from Drucker's decision making process. You will note that the right alternative may not be...

  Tambe Larry
Student (MBA), Brazil
 

Decision Making Across Cultures

Decision-making varies across cultures and locations. A more paternalistic society like Africa and the Latin Americas re...

  Jagdish Mehta
Entrepreneur, India
 

Decision Making Process Redefined

It is not always possible to take decisions strictly as a management process. There are times when we bypass all the le...

  Lee Lai Seng
Entrepreneur, Malaysia
 

The Purpose of Decision Making

@Walter Pascal : Decision making process arises when a person has more than one options, whether organisational or perso...

  TIENON CELESTIN, Cote Divoire (Ivory Coast)
 

Feedback Effects in Decision Making

Some decisions when taken have a feedback loops (feedback effects) that can cause them to be more or less effective. I'...

  Per Wickman
Analyst, Sweden
 

What Influences Decision-making?

I believe the most important influences on decision-making are: • Culture and how we think… • Knowledge • Methods ...

  KISHOR KUMAR
Manager, India
 

Decision Making is also Determined by a Person's Intelligence

It is the intelligence of a person that allows her/him to make an decision (that fits ) to the situation....

  Bornface Chinyuku
Student (University)
 

Decision-making in the Public Sector

In the public sector many decisions are made basing on their "political correctness". If the decision choice is not in s...

  Christian Buzane
Lecturer, Mexico
 

Decision Making Involves us

I agree with most of all the comments presents here... However I believe there is always an opportunity to choose, wethe...

  Paramathmuni srinivas Kumar
India
 

Decision Making Process Redefined

Is decision making an evolutionary process, where we unlearn some of the things of past, and where we relearn and adapt ...

  TIENON CELESTIN, Cote Divoire (Ivory Coast)
 

Looping Decision Making Process...

@Srinivas: you're right I'm wondering if there is a conceptual framework dealing with this looping decision making proce...

  David Guild
Consultant, Australia
 

Influences on Decision-making : Stress and Tunnel Vision

Stress plays a huge role in decision making too. When people are stressed, whether it is immediate stress or prolonged s...

  tan liong choon
Management Consultant, Singapore
 

Definition of a Decision: The Role of Delegation and Empowerment

Decision-making is closely tied to empowerment. Everybody makes decisions on a daily basis, i.e. decision-making is seen...

  Ann Wallace
Business School Marketer, Barbados
 

Centralized Decision-making in Organisations

@Rev. Matthias A. Idyu: you have made an excellent point. The problem with decision-making in far too many organisations...

  Leena Bissoonauth
Student (University), Mauritius
 

Using Emotions to Improve Decision-making

@McCallum: Indeed decisions are based upong (strong) emotions. And when emotions are not dealt with in a constructive wa...

  PratapachandranK
Management Consultant, India
 

Decision Making in Organisations

Decisions are the end result of a complex process of problem solving based on information availability, urgency, experti...

  K R Sethuraman
Professor, Malaysia
 

Problem-knowledge Coupling for More Appropriate Decisions

Problemistics is a science of problem-dealing and helps in a thorough understanding of the problem to be solved. It has ...

  Handa
CEO, India
 

Influences on Decision Making: Biases

It's important you realize that cognitive biases and similar errors can also affect decisions. For example when: a) The...

  Helmer Pardun, Germany
 

The Role of the Situation in Decision Making

I think, that by relating "decision making" to "a conclusion about a situation" one shifts the problems to the "definiti...

  Karel V
CEO, South Africa
 

About the Top Decision Maker in an Organization

I believe it's important to have an agile, intuitive, experienced and intelligent thinker in a final decision-making pos...

  Nick Snowden, United Kingdom
 

The Problem with Decisions for Wicked Problems

@Malik Iqbal Kabir: I'm sure Drucker was right regarding the need of understanding the problem before deciding on a solu...

  A. Flippo
Business Consultant, Netherlands
 

Components for Effective Decision Making according to Peter Drucker

As a past student of Drucker's classes, I remember the following as components to "the effective decision": 1. What hap...

  Mrs c usha rani
Professor, India
 

Bottom-up Approach in Decision Making

Decision making is a key function in any organization. At every level, decision making authority is vested to certain ma...

  Belay Gezahegn
Director, Ethiopia
 

Additional Factors That Affect Decision Making

@Per Wickman: Decision making also depends on the environment we are working in. Participatory leadership, for instance,...

  JEREMIAH MUNENE
Teacher, Kenya
 

Information Sources for Making a Decision

Decision making process is key and inevitable at the workplace. But to make an informed decision you must have relevant ...

  Les Hirst
Project Manager, United States
 

Emotion and Reason - the Siamese Twins of Decision Making

Western dichotomous thinking asks us to decide which is most valuable in good decision-making. Wise men in any culture k...

  jorge anibal hoyos hoyos
Manager, Colombia
 

Comprehensive Coverage but Long Term, Strategic Effects of Decisions are Missing

I think it`s missing to include the long term effects of the decisions, the strategical map to be considered in beforeha...

  Julius Nyangaga
Consultant, Kenya
 

Research Decisions, but not Forever

@Nick Snowden: yes, this is a typical problem with those with a strong research background. You investigate the problem ...

  Mrs c usha rani
Professor, India
 

Decision Making versus Policies

Decisions at different levels may be flexible and fixed on certain issues. As Drucker said, to make decision effective, ...

  Ashok Panda
Professor, India
 

Decision-making is the Prime Aspect of All Human Activities

A human being is a lovely outcome of a spiritual imagination. We take help of knowledge by books and experience. What ha...

  Martin Parry
Management Consultant, South Africa
 

Views by Peter Drucker on Decision-making still Useful

I still think Peter Drucker's views are valid and insightful. Decision-making remains one of the key skills in any organ...

  Lesele
Management Consultant, South Africa
 

Decision Making Must be a Group Process

Bureaucratic mindsets must be removed from our minds. In an establishment, decision making must be conducted by a group ...

  Bonginkosi Dlamini
Student (University), South Africa
 

Decision Making by Peter Drucker

I agree the decision making is a reaction to an event and can be more effective if it is more collaborative and particip...

  Mohd Norfaizin Bin Hj. Md Salleh AFA (UK)
Director, Malaysia
 

A Foolproof Art of Decision Making...

Decisions are basically the essence of our daily life: - Those who strongly believe in fate will say that things are al...

  mario ianniello
Italy
 

Rational Decision Making?

Beware of "rationalists" approaches. There is plenty of literature on how muddy and non-linear decision making processes...

  Paramathmuni srinivas Kumar
India
 

Decision Making: The Power-issue

I agree that the "power-issue" cannot be ignored. The person weilding power and making decisions needs to have attained ...

  prince henry morrison, Ghana
 

Additional Factor Influencing Decision Making

@V SHRIDHAR : I agree with your submission. I believe that the availability of resources (such as time, capital and the ...

  Ivan Kohlinsky
Management Consultant, United Kingdom
 

Decision Making Has Several Human Elements

I agree that emotions, culture and, rightly or wrongly, sometimes acceptability overlay any rational scientific process....

  kvssiyer
Consultant, India
 

Decision Making Requires Data of Good Quality

Decisions are made at every moment and every situation demands a decision of one sort or the other. Sometimes decisions ...

  Bornface Chinyuku
Student (University)
 

Decision Making Involvement and Participation

@A. Flippo: I agree that situational analysis is key before embarking in the decision making process. Besides that, ess...

  Alkhaly Mohamed Tahey Conde
Lecturer, Guinea
 

Problem Definition Before Decision-making

@Malik Iqbal Kabir: You are right to state this clear position. It is crucial to define the issue well before jumping i...

 

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Decision-making and Valuation



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