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JIMINY SELF-HELP HANDBOOK 7

The Process for Entrepreneurial Decision-Making
The decision-making process is one of the most critical processes not only in a company, but also in
our personal life, that is why decisiveness (or the lack of it) can “make” or “break” many opportunities.
Have you ever thought that even economic decision-making in private households is a topic relevant
to entrepreneurial thinking? As analyzed by Kirchler, Winter & Penz (2016), “When speaking of private
households, research typically revolves around couples, both with or without children, who live under
one roof. Often, economic decisions need to be made that will demand in-depth analyses, lead to
uncertainty and force the couple to weigh different alternatives, so that in the end specific actions can
be taken. Decision-making processes are often characterized by differences of opinion between
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partners, which can cause disagreements and conflicts” . To be effective in various aspects of our daily
life, one must gain the ability to look at a problem or situation, take into account all available data (at
that point in time), and make a confident decision to move forward.

As it can be shortly described “decision making is the process of making choices by identifying a
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decision, gathering information, and assessing alternative resolutions” . The following step-by-step
decision-making process by the University of Massachusetts, which is also the most common one, can
help people make more deliberate, thoughtful decisions by organizing relevant information and
defining alternatives, increasing the chances of choosing the most satisfying alternative possible.

7: Review
decision
6: Take
action
5: Choose
among
4: Weigh alternatives
the
3: Identify evidence
the
2: Gather alternatives
relevant
1: Identify information
the decision

Seven steps to effective decision making
Source: University of Massachusetts
https://www.umassd.edu/fycm/decision-making/process

Step 1: Identifying the decision. This first -and very important step- has to do with realizing that we
need to make a decision and try to clearly define the nature of this decision. In other guides, this first
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step is mentioned as “Recognizing the problem” , given that every decision-making process starts with

77 Kirchler, E., L. Winter, E. Penz (2016), “Methods of Studying Economic Decisions in Private Households”, Revista
Crítica de Ciências Sociais [Online], 111 | 2016, http://journals.openedition.org/rccs/6467, DOI:
https://doi.org/10.4000/rccs.6467
8 University of Massachusetts, “Decision-making process”, available online
https://www.umassd.edu/fycm/decision-making/process
9 Sutevski, Dragan, “An Introduction to Decision Making Process”, Entrepreneurship in a Box, available online
https://www.entrepreneurshipinabox.com/2062/an-introduction-to-decision-making-process