Robert Frost wrote, “Two roads diverged in a wood, and I—I took the one less traveled by, and that has made all the difference.” But unfortunately, not every decision is as simple as “Let’s just take this path and see where it goes,” especially when you’re making a decision related to your business.

Whether you manage a small team or are at the head of a large corporation, your success and the success of your company depend on you making the right decisions—and learning from the wrong decisions.

Use these decision-making process steps to help you make more profitable decisions. You'll be able to better prevent hasty decision-making and make more educated decisions when you put a formal decision-making process in place.

Defining the business decision-making process

The business decision-making process is a step-by-step process allowing professionals to solve problems by weighing evidence, examining alternatives, and choosing a path from there. This defined process also provides an opportunity, at the end, to review whether the decision was the right one.

7 decision-making process steps

Though there are many slight variations of the decision-making framework floating around on the Internet, in business textbooks, and in leadership presentations, professionals most commonly use these seven steps.

1. Identify the decision

To make a decision, you must first identify the problem you need to solve or the question you need to answer. Clearly define your decision. If you misidentify the problem to solve, or if the problem you’ve chosen is too broad, you’ll knock the decision train off the track before it even leaves the station.

If you need to achieve a specific goal from your decision, make it measurable and timely so you know for certain that you met the goal at the end of the process.

2. Gather relevant information

Once you have identified your decision, it’s time to gather the information relevant to that choice. Do an internal assessment, seeing where your organization has succeeded and failed in areas related to your decision. Also, seek information from external sources, including studies, market research, and, in some cases, evaluation from paid consultants.

Beware: you can easily become bogged down by too much information—facts and statistics that seem applicable to your situation might only complicate the process.

3. Identify the alternatives

With relevant information now at your fingertips, identify possible solutions to your problem. There is usually more than one option to consider when trying to meet a goal—for example, if your company is trying to gain more engagement on social media, your alternatives could include paid social advertisements, a change in your organic social media strategy, or a combination of the two.

4. Weigh the evidence

Once you have identified multiple alternatives, weigh the evidence for or against said alternatives. See what companies have done in the past to succeed in these areas, and take a good hard look at your own organization’s wins and losses. Identify potential pitfalls for each of your alternatives, and weigh those against the possible rewards.

5. Choose among alternatives

Here is the part of the decision-making process where you, you know, make the decision. Hopefully, you’ve identified and clarified what decision needs to be made, gathered all relevant information, and developed and considered the potential paths to take. You are perfectly prepared to choose.

6. Take action

Once you’ve made your decision, act on it! Develop a plan to make your decision tangible and achievable. Develop a project plan related to your decision, and then set the team loose on their tasks once the plan is in place.

7. Review your decision

After a predetermined amount of time—which you defined in step one of the decision-making process—take an honest look back at your decision. Did you solve the problem? Did you answer the question? Did you meet your goals?

If so, take note of what worked for future reference. If not, learn from your mistakes as you begin the decision-making process again.

Tools for better decision-making   (Decision Tree)

Depending on the decision, you might want to weigh evidence using a decision tree. The example below shows a company trying to determine whether to perform market testing before a product launch. The different branches record the probability of success and estimated payout so the company can see which option will bring in more revenue.

A decision matrix is another tool that can help you evaluate your options and make better decisions. Learn how to make a decision matrix and get started quickly with the template below. 

You can also create a classic pros-and-cons list, and clearly highlight whether your options meet necessary criteria or whether they pose too high of a risk.

With these 7 steps we've outlined, plus some tools to get you started, you will be able to make more informed decisions faster.

If your business relies on information technology (IT) systems such as computers and networks for key business activities you need to be aware of the range and nature of risks to those systems.

Probability * Consequence = Risk

Looking at the nature of risks, it is possible to differentiate between :

*Physical threats - 

resulting from physical access or damage to IT resources such as the servers. These could include theft, damage from fire or flood, or unauthorized access to confidential data by an employee or outsider .

*Electronic threats - 

aiming to compromise your business information - eg a hacker could get access to your website, your IT system could become infected by a computer virus, or you could fall victim to a fraudulent email or website. These are commonly of a criminal nature .

*Technical failures - 

such as software bugs, a computer crash or the complete failure of a computer component. A technical failure can be catastrophic if, for example, you cannot retrieve data on a failed hard drive and no backup copy is available .

*Infrastructure failures - 

such as the loss of your internet connection can interrupt your business - eg you could miss an important purchase order .

*Human error - is a major threat - eg someone might accidentally delete important data, or fail to follow security procedures properly.

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Another classification on Types of IT risks

1- Viruses: type of malicious code or program written to alter the way a computer operates and is designed to spread from one computer to another.

2- Malware : is any software intentionally designed to cause damage to a computer, server, client, or computer network

3- Hardware failure: a malfunction within the electronic circuits or electromechanical components (disks, tapes) of a computer system.

4- Software failure: a failure that occurs when the user perceives that the software has ceased to deliver the expected result with respect to the specification input values.

5- hackers : people who illegally break into computer systems

6- Natural disasters: such as fire, cyclone and floods also present risks to IT systems, data and infrastructure. Damage to buildings and computer hardware can result in loss or corruption of customer records/transactions.

7- fraud : using a computer to alter data for illegal benefit

8- Security breaches: any incident that results in unauthorized access to computer data, applications, networks or devices. It results in information being accessed without authorization. Typically, it occurs when an intruder is able to bypass security mechanisms. includes physical break-ins as well as online intrusion

Intentional مقصود & Unintentional غير متعمد Risk

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Strategic Risk

Risk that affects the achievement of the org. main Strategic and long term objective  >>> 

- Reputation. السمعة

- Customer relation, The quality, Org. culture.    Competition

Operational Risk

- Network Risk, Intruders risk, Hackers, Virus Attacks, accidental delete,  Hard disk, علق البرنامجو 

General IT Threats

General threats to IT systems and data include:

• hardware and software failure - such as power loss or data corruption
• malware - malicious software designed to disrupt computer operation. 
• viruses - computer code that can copy itself and spread from one computer to another, often disrupting computer operations
• spam, scams and phishing - unsolicited email that seeks to fool people into revealing personal details or buying fraudulent goods
• human error - incorrect data processing, careless data disposal, or accidental opening of infected email attachments.

Read more about email scams, viruses, hackers, and other IT threats.

Criminal IT Threats

Specific or targeted criminal threats to IT systems and data include:

• hackers - people who illegally break into computer systems
• fraud - using a computer to alter data for illegal benefit
• passwords theft - often a target for malicious hackers
• denial-of-service - online attacks that prevent website access for authorised users
• security breaches - includes physical break-ins as well as online intrusion
• staff dishonesty - theft of data or sensitive information, such as customer details.

Read more about online crimes against business.

Learn more about protecting your website from hackers.

Natural Disasters and IT Systems

Natural disasters such as fire, cyclone and floods also present risks to IT systems, data and infrastructure. Damage to buildings and computer hardware can result in loss or corruption of customer records/transactions.

Read more about preparing for and recovering from natural disasters and business continuity planning.

Also consider...

• Learn about resources to improve the cybersecurity of your business.
• Find out more about protecting IT data and systems.
• Read our cyclone and storm surge preparation checklist.
• Read our bushfire preparation checklist.
• Find out how to create a digital strategy for your business.
• Learn more about electrical safety in the workplace.

Managing information technology risks

Threats and risks to information technology (IT) systems and data are an everyday reality for most modern businesses. You should put in place measures to protect your systems and data against theft and hackers.

Practical steps to improve IT security

To help protect your IT systems and data you should:

• secure computers, servers and wireless networks
• use anti-virus and anti-spyware protection, and firewalls
• regularly update software to the latest versions
• use data backups that include off-site or remote storage
• secure your passwords
• train staff in IT policies and procedures
• understand legal obligations for online business.

Read more about protecting IT data and systems.

Create a secure online presence

If your business has an online presence, you should assess the security of your website, email accounts, online banking accounts and social media profiles.

For example, secure socket layer (SSL) technology is used to encrypt transaction data and to send customer and card details to the acquiring bank for authorisation. You should ensure any web hosting solution you consider is capable of supporting the SSL protocol.

Induction and IT training for staff

Training new and existing staff in your IT policies, procedures and codes of conduct is an important component of IT risk management strategies. Training can cover key business processes and policies, such as:

• safe handling of infected email
• protecting the privacy of customer details
• priority actions in the event of an online security breach.

As an employer you have legal obligations when training staff. Providing support and training for new employees is a critical aspect of staff training. Read more about staff inductions and staff training.

Business insurance

It is impossible for a business to prevent or avoid all IT risks and threats. This makes business insurance an essential part of IT risk management and recovery planning. You should regularly review and update your insurance, especially in light of new or emerging IT risks, such as the increasing use of personal mobile devices for workplace activities.

Learn more about choosing the right business insurance.

Also consider...

• Find more resources to improve the cybersecurity of your business.
• Read the guide to information security for steps and strategies to protect online privacy.
• Learn about legal obligations for online business.
• Find out more about good business processes, procedures and standards.

This IT risk management checklist can help you determine the basic precautions and steps to take in managing IT risk to your business.

Read through the checklist and click 'Yes' or 'No' to answer the questions.

If you answer 'No' to any question, you will create a list of actions to complete to ensure your business can manage IT risk.

Have you:

Also consider...

• Learn about resources to improve the cybersecurity of your business.
• Find out how to create a digital strategy for your business.
• Read about how to avoid business scams.
• Learn more about cybersecurity.