How are decisions made? Exploring the Strategic Decision-Making Process

Abstract

In business, managers seem to make decisions and afterwards look for ways to justify the decisions. Why is business conducted this way? What is the process for decision-making? Decision-making is at the core of everything that happens within an organization and has fascinated researchers for decades. These researchers have developed theories that can be linked to the observation made in the first sentence, but they do not seem to fully explain the phenomena. To explore the process of decisioning, an abductive approach, using the observations that the authors have made in business, a theoretical framework and extreme case studies focusing on decisioning with regard to new product development in small international companies, was used. In confronting the theoretical propositions in the form of a conceptual model against the empirical research findings, this study was able to highlight a number of factors that influence the process; the process driver, political support, inertia, knowledge and analysis. Their interaction provides a model where the process driver drives the process, political support influences the decision-maker, inertia determines the process used, knowledge is the basis for decisions and analysis is used to justify, legitimize or gain commitment for decisions. The model can be use by managers to shed light on the process of decisioning and be used as a basis for further academic studies in the practical exploration of strategic decision-making.