A Decision-Making Model for More Effective Decision Making

DECIDEA Decision-Making Model for More EffectiveDecision Making by Health Care Managers

Kristina L. Guo, PhD, MPH

The purpose of this article is to describe a step-by-step process for decision making, and a modelis developed to aid health care managers in making more quality decisions, which ultimatelydetermines the success of organizations. The DECIDE model is the acronym of 6 particularactivities needed in the decision-making process: (1) D = define the problem, (2) E = establish thecriteria, (3) C = consider all the alternatives, (4) I = identify the best alternative, (5) D = developand implement a plan of action, and (6) E = evaluate and monitor the solution and feedback whennecessary. The DECIDE model is intended as a resource for health care managers when applyingthe crucial components of decision making, and it enables managers to improve their decision-making skills, which leads to more effective decisions. Key words: decision making, decision

model, decision processes, health care manager

HEALTH CARE MANAGERS operate in anincreasingly complex system. With nume-

rous economic, legal, ethical, organizational,and technical changes taking place, mana-gerial decision making has a direct impact onindividuals in the workplace and on the per-formance of the organization and is influ-enced by a multitude of other factors thatcould result in financial success, customersatisfaction, and long-term viability for theorganization. Decision making is inherent inall managerial functions and is closely relatedto the planning function. Regardless of level,all managers make decisions, although thedecisions made by senior managers have abroader scope, affect more individuals, andhave a greater impact than those made byfirst-line supervisors. Decision making is aprocess of choosing the best alternative toachieve individual and organizational objec-

tives. Not all managers know the processesto decision making. Identifying and using thedecision-making process help managers tomake more effective decisions. Although sev-eral decision-making models and processeswere found in the literature review, thisarticle is different because it is intended toadd to the existing research. The purposeof this article is to describe a step-by-stepprocess for decision making, and a model isdeveloped to aid managers in making morequality decisions, which ultimately deter-mines the success of organizations. Specifi-cally, an application of the decision-makingmodel is presented using a health careexample, thus enabling health care managersto improve their decision-making skills.

DECISION-MAKING MODELS

Several different decision-making process-es and models were found in the literature.1-7

Descriptions and their relevance are dis-cussed here. The basic components of thesemodels are similar. For instance, the militarymodel occurs in 5 steps.1 It begins withdefining the objective in which needs andoptimum outcomes are identified. In thesecond step, all available resources are dis-cussed. Third, a plan is established in which

The Health Care ManagerVolume 27, Number 2, pp. 118–127Copyright # 2008 Wolters Kluwer Health |Lippincott Williams & Wilkins

Author Affiliations: Department of Public

Administration, Health Care Administration

Program, University of Hawaii–West Oahu.

Corresponding author: Kristina L. Guo, PhD, MPH,

Department of Public Administration, Health Care

Administration Program, University of Hawaii–West

Oahu, 96-129 Ala Ike, Pearl City, HI 96782

([email protected]).

118

Copyright @ 2008 Lippincott Williams & Wilkins. Unauthorized reproduction of this article is prohibited.

a manager writes down the specific actionrequired. The fourth step involves laying outthe course of action so that checkpoints aredetermined to make sure that objectives aremet. The final step is to provide closure inwhich accomplished objectives are indi-cated. This model can be used to implementdecisions; however, specific details are notadequately described. Statements are ambig-uous and lacking in clarity to truly aidmanagers in making decisions. For instance,in the last step, ‘‘closure is made up of thosefinal benchmarks of success’’ to indicate thatthe plan was successful.2 This statement isvague and does not provide managers withdirection or adequate information on how toproceed with benchmarking.

The parliamentary model occurs in 8 stepsand is similar to the military model. The8 steps are the following: (1) establish need,(2) define the optimum outcome, (3) con-duct a stakeholder review, (4) list the prosand cons, (5) make an option review, (6)review potential consequences, (7) formu-late a step-by-step plan, and (8) analyzeachievement.1

Again, this model does not provide specif-ics. For example, in step 7, establishing aplan does not clarify the kinds of informationneeded for the plan to be successfullyimplemented. Furthermore, a third decisionmodel combines elements from both themilitary and parliamentary models. Knownas QUICK, this model focuses on quicklymaking decisions and executing action. Itconsists of 5 particular activities in thedecision-making process: question appropri-ate parties, understand your objectives,investigate all options, communicate clearlyto all concerned, and keep on top of thingsby monitoring process. However, the QUICKmodel lacks detail about the specific activi-ties required. Overall, this model is notcomprehensive or well defined.

AN ALTERNATIVE MODEL FORDECISION MAKING

After a review of the literature on decisionmaking, this article proceeds to describe an

alternative decision-making model to helphealth care managers in the decision-makingprocess. A decision-making process consistsof a series of steps that managers take toarrive at the decision. The purpose is tocreate a systematic model for decisionmaking. That is, if managers use an organizedand precise process, then the chances ofmore successful and effective decisions willresult compared to that of disorganized andunsystematic processes. This article de-scribes a decision-making process using theacronym DECIDE. Each letter of the acronymDECIDE stands for 1 of 6 specific activitiesthat must be carried out before proceedingto the next step. The 6 steps in the DECIDEmodel is illustrated in Figure 1 and is listedbelow:

1. D = define the problem.2. E = establish the criteria.3. C = consider all the alternatives.4. I = identify the best alternative.5. D = develop and implement a plan of

action.6. E = evaluate and monitor the solution

and feedback when necessary.To assist managers in making decisions,

Figure 2 is an application of the DECIDEmodel using a health care example.

D = define the problem

Decision making is a problem-solvingprocess that aims to eliminate barriers toachieving individual or organizational goals.By defining problems or determining whatthe barriers are, then managers can takesteps to remove these barriers. However,defining the problem is not an easy task. Itcan be a time-consuming process. A managermust question the staff and monitor dailyactivities and tasks to fully investigate theextent of the problem. Dunn2 suggests thatwhat often appears as a problem may only bea symptom and digging deeper can lead tothe real problem. For example, senior man-agement noted that many employees werelate to work and showed negative attitudestoward each other and the patients. Therewas increased disagreement among staff,

Decision-Making Model for Health Care Managers 119


which caused many to feel unhappy in theworkplace, and ultimately, they chose tovoluntarily terminate their employment atABC Health Care System. The symptomsshowed dissatisfied and unmotivated work-ers. Upon further investigation, senior man-agement found that the real problem wasa lack of communication, supervision, anddirection by department level managers. As aresult, the staff were disgruntled, which ledto high turnover. To clearly define the realproblem, an individual manager should beconcerned with 3 basic questions: (1) whatis the problem? (2) Why should anythingbe done at all? (3) What should or could behappening? According to Arnold,3 a decisionis necessary under these conditions:

1. Something has happened that should nothave happened. Thus, corrective action

is necessary. For example, all patientmedical records were inputted into anew computer database, and mysteri-ously, all records were lost. The chiefinformation officer recognizes that a se-rious problem has occurred, and an ac-tion must take place to correct the error.

2. Something can happen and should beprevented. For instance, at the SummitAmbulatory Surgery Center, signs wereposted to inform patients that renova-tions and expansions are taking place tobetter serve patients. Because part ofthe clinic which houses medical sup-port staff and office equipment is be-ing renovated, the insurance claimsspecialist along with the copy and faxmachines that she needs for her workwere temporarily put in the patient

Figure 1. DECIDE: a model of the decision-making process.

120 THE HEALTH CARE MANAGER/APRIL–JUNE 2008


waiting room. One afternoon, the pa-tient registration coordinator was busywith patients, and the claims specialistwas out for lunch. A patient walked byand saw that a fax was coming throughand fell to the floor. She picked it up andwas about to sit down to read throughit. Just then, a manager walked by andsaw what had occurred. He asked forthe fax and was alarmed when herealized that it detailed confidentialpatient medical history about one oftheir celebrity patients. Luckily, thepatient had not read the confidential

information. However, it could havecaused a potential problem had thepatient read the fax. Although the reno-vation was only temporary, problemsmay occur and must be prevented fromhappening.

3. Something should happen and is nothappening; therefore, it needs to takeplace. When the urgent care clinicopened 2 years ago, it began as a smalloperation, and Dr Scott, owner and theonly primary care physician, hired 1nurse and 2 assistants, one responsiblefor assisting with all clinical aspects and

Figure 2. An application of the DECIDE model.



the other responsible for all supportfunctions, including registering patients,confirming patient appointments, and allinsurance responsibilities. Dr Scott’swife served as office manager and tookcare of all other miscellaneous tasks.Two years later, business was goingwell. Dr Scott felt that he needed tohire another physician to help himprovide more prompt service. As aresult, he hired a young medical doctorwho just completed her residency. Inthe meantime, the nurse asked forassistance with clinical responsibilities,and the support staff asked for additionalhelp as well. Mrs. Scott responded thatbecause of lack of resources, everyonemust do more with less. Thus, noadditional support staff were going tobe hired. In this case, as the clinic growsand patient volume increases, somethingshould happen (hire more support staff)and is not happening (Mrs Scott has nothired any additional staff).

Another way to help define a problem is todevelop a statement of the problem. Thereare 4 parts to the statement4:

1. in what ways (can the problem beaddressed),

2. we (ie, managers, patients, staff) arethose who take ownership of theproblem,

3. action (implement or make an improve-ment), and

4. response time (goal attainment).For instance, a problem statement could

be written as follows: ‘‘In what ways can we(managers) motivate staff to make themmore satisfied at work?’’ Another problemstatement could be as follows: ‘‘In what wayscan we (managers) reduce patient waitingtimes in the emergency department?’’

In addition, to define problems, managerscan compare status quo against some stan-dard. One standard is using the past againstwhich managers compare the present tosearch for differences. Another way to defineproblems is through plans and forecasts.8

Managers are evaluated against their or-ganizational goals, such as achieving and

maintaining accreditation status, loweringcomplication rates, and increasing patientsatisfaction and other performance variables.When these goals fall below projections,then a manager encounters a problem. Athird standard is benchmarking to compareagainst a recognized standard, such as thequality standards recognized by the NationalCommittee on Quality Assurance. Whendiscrepancies occur among the 3 standards,then problems exist.

McCall and Kaplan8 suggest that recogniz-ing that problems exist is not always anautomatic part of the decision-making pro-cess, but this is an essential function ofmanagers. In fact, effective managers do notspend time dwelling on things that could gowrong. Rather, they find problems and actintuitively to resolve them. The best way todefine problems is to gather information bylistening and asking questions and also to beknowledgeable about the entire organizationby knowing one’s subordinates and superiorsand knowing the business.

Included in the problem definition is anexamination of the purpose or central focus ofthe decision. In other words, the purpose isthe mission or needs that must be determined.It should be stated more broadly to find awider range of solutions and especially onethat is more tailored to meet one’s needs. Forexample, a manager may wish to establish thebest office space to accommodate employeeswith disability, establish the best type of workfor an individual who is more introverted, orestablish the best way to retain employees inthe workplace. Arnold3 suggests that thepurpose should be formed as follows: ‘‘Whatam I trying to decide and why?’’ Moreover,statements of purpose should be opportunityoriented, manageable, and positive.9 Forinstance, Nurse Manager Jones of the pediat-rics department has noticed that Nurse Adamsin the past month has called in sick 3 timesand been late 4 times. Before meeting withAdams, Jones tries to establish the purpose ofher meeting with Adams. Is she trying toestablish the best way to ensure that Adamscomes to work on time? That statement is toonarrow; instead, she needs to determine



whether Adams is satisfied with her responsi-bilities as a nurse and whether she enjoys hercurrent duties and the work environment.Rather than reprimanding Adams, Jones focuseson finding out whether Adams is content inthe workplace, whether she is getting alongwith her coworkers, or whether she may behaving personal issues that are affecting herwork. Having established the purpose, Jonesworks with Adams to determine the best wayto ensure that Adams is happy with her job.

In the decision-making process, the pur-pose is often forgotten. A narrowly focusedpurpose may overlook other opportunitiesor possibilities and lead to fewer alternativesor solutions. By defining the problem andthe purpose as broadly as possible, a man-ager is able to find more significant and far-reaching results.

E = establish the criteria

After having defined the problem, thesecond step is to establish the criteria.Criteria are the measures used to arrive at asolution that best fulfills the purpose.3

Criteria should not be confused with pur-pose. The purpose is ‘‘what needs to bedetermined and why?’’ Decision criteria areused to achieve the purpose. Arnold3 uses 3questions to help establish the criteria.

1. What do you want to achieve in yourdecision?

2. What do you want to preserve?3. What do you want to avoid as problems?The following is an example of establish-

ing the criteria. David, a first-line supervisorin the human resources department, is beingconsidered for a promotion to the position ofa middle-level management human resourcesspecialist position. Before accepting thepromotion or deciding to stay in his currentposition, David clarifies his criteria. He wantsto achieve maximum earnings, the freedomto work independently, feelings of accom-plishment, pleasant work environment, ap-preciation and recognition for his work, andthe opportunity for growth. At the sametime, he hopes to preserve his personal timefor his family, time for friends, and time for

hobbies (continue to train for the marathon).Furthermore, he wants to avoid workingwith unpleasant people, having a high-pressure and stressful job, and having asuperior who constantly looks over hisshoulder. After establishing a list of criteria,David is now clear on what he hopes toachieve, preserve, and avoid. Next, heclassifies the criteria by sorting out the moreessential and absolute requirements. Not allcriteria are equally important. They areseparated into categories of relative impor-tance, ranging from high to low. Criteria thatreceive high values become more important.In this case, David categorizes his criteria byranking the most important criterion asachieving the opportunity for personalgrowth and advancement within the organi-zation. This is considered more essential forDavid than the other criteria.

Establishing the criteria means being asspecific and precise as possible. This meansthat an individual must be able to separateabsolute requirements from desirable ones.For instance, an absolute requirement, or acriterion that must be preserved, is one thatis unequivocally necessary. If any decisiondoes not satisfy this criterion or requirement,then that decision should be rejected. On theother hand, a desirable requirement is a goalthat one should aim for and try to achievebut is not a ‘‘must.’’ As a further example, ifhaving a high salary is an absolute criterion,then the individual needs to quantify thecompensation by stating a minimum salarylevel. For instance, the absolute criterionwould be not to take a position that offerslower than $50,000 a year. In this way, thecriteria are first established and then sortedout as absolute requirements and desirablerequirements.

C = consider all the alternatives

Considering all alternatives is a search forvarious alternative courses of actions andsolutions. Many alternatives, and not just thetraditional 2 or 3, need to be considered.10

To derive all the alternatives, a manager mustengage in brainstorming to develop and



consider as many alternatives as possible.This method leads to more choices andincreases communication and team building.Another method to develop alternatives isthrough using the Internet to hold discussiongroups with peers around the world who canactively participate in discussions by sharingtheir experiences and outcomes. A majoradvantage of this method is being able toobtain alternatives from colleagues from avariety of cultures, which enriches thealternatives.2 For any given situation, thereshould be several alternatives. Althoughthese choices are not obvious, a manager isresponsible for casting a wider net to createas many as possible. Some alternatives maynot be desirable. For instance, managersshould be aware that there are certainfactors that could limit alternatives, such asauthority, human, physical, technological, oreconomic factors. Specifically, higher ad-ministration or central authority may informa middle- or first-level manager that a cer-tain alternative is not feasible (ie, centraladministration does not support a manager’salternative to reorganize and combine 2 de-partments of dermatology under 1 manager).Human factors (ie, lack of experienced staff)may also prevent the implementation of analternative. Physical factors (ie, redesigningthe cosmetic surgery clinic) are not physi-cally possible because of space issues.Technological factors (ie, purchasing newmedical equipment) may not take prece-dence this fiscal year. Economic factors (ie,recession) may hinder alternatives frombeing implemented because costs are muchhigher than expected. When evaluatingalternatives, a manager should identify theeconomy of the effort, that is, the action thatwill provide the greatest benefit with theleast amount of effort and expenditure.2 Inaddition to these factors, there are otherfactors that can limit a manager’s alternativedecisions. For example, legal restrictions,moral and ethical norms, social norms, andformal organizational policies and rules canprevent alternatives from being feasible.

A major factor that determines whichalternatives should be chosen is the impor-

tance of organizational values. Managersmust abide by 5 essential values: (1) account-ability, (2) adaptability, (3) dependability (4)responsibility, and (5) visibility.1 First, man-agers are held accountable for the decisionsthey make, how those decisions weredetermined, and what data were collectedand analyzed. Second, in making decisions,managers must have a degree of adaptabilityso that options can be considered and madeflexible. Third, employees rely on managersto make timely decisions. Fourth, a managermust be able to take ownership of thedecisions. Although managers can delegateparticular tasks, they ultimately take respon-sibility for the outcome. Finally, a manager’svisibility is especially crucial in uncertaintimes and in situations that are out of thenorm.

Only when all the factors that may affect aset of alternatives are fully considered, then alist of feasible alternatives is generated.

I = identify the best alternative

In the process of identifying the bestalternative from among the various chosenalternatives, a manager should be aware thatan alternative decision must be of highquality and supported and accepted by thegroup of employees immediately affected bythe decision in the organization. Decisionswould not be effective or may even besabotaged when the group does not willinglyaccept the decision.

A manager’s final selection of variousalternatives is influenced by experience(experiential decision making), intuition, orexperimentation. Experiential decision mak-ing is very common in medical care. Physi-cians often base their decisions on theirexperience. A manager can base his/herdecision on a past experience because ofsimilarities in problem definition. Whateverwas held true in the past may still workin the present situation. Previous experiencecan also be a good defense tactic when iden-tifying an appropriate alternative.2

Intuition or ‘‘gut feeling’’ can help man-agers choose among alternatives. However,



managers should not base their decisions onhunches alone. Experimentation or testing isa valid approach to aid in identifying the bestalternative. For instance, a manager maywant to test different work schedules to ac-commodate the needs of particular employ-ees. Arnold and Tompkins9 recommend thatthe best way to distinguish among thealternatives is to place values on the alter-natives. In other words, similar to step 2 inestablishing the criteria, here again, a man-ager should rank each alternative againsteach criterion. An alternative that only meetshalf of the criteria gets a ranking of 5 inrelation to the other alternatives. Once all thealternatives have been ranked against thecriteria, one can distinguish the more valu-able and important alternatives that satisfymore criteria compared to the others thatmeet fewer criteria.

An alternative that satisfies all the criteriagets the highest rating (ie, a rating of a 10)and becomes the best alternative. Thisapproach, known as maximizing, developsthe one best solution by comparing all thealternatives against all the criteria until onesolution emerges. The maximizing methodleads to the one best solution, which is theonly acceptable one.11

However, when pressured by time, anurgent solution is needed. In these cases, aset of minimal criteria is developed, and anyalternative that fulfills the minimal criteria isacceptable. This is known as satisficing.Managers recognize that there may be bettersolutions, but this simplified approach isused because of the urgency of the situationto identify any alternative that meets theminimal criteria.11

D = develop and implement a planof action

Developing and implementing a plan ofaction are as important as making thedecision. Planning is the most fundamentalfunction of managers. It provides direction,establishes control, anticipates change, anddevelops responses to uncertainty. This stepinvolves 2 essential processes: communica-

tion and coordination.2,12 Communicationentails the exchange of information amongvarious individuals in the organization. If thedecision is not clearly communicated to thestaff who must perform the decision andunless it is coordinated with other depart-ments in the organization, the plan and thedecision are worthless. In this step, 2questions must be answered. (1) How isthe action plan going to be implemented?What are the resources used in the actualimplementation? Within the planning func-tion, goals and objectives are set. Senior-leveladministrators are responsible for the pri-mary objectives for the organization, where-as middle-level managers are responsible forsecondary or department goals. Specifically,they must be able to develop measurableobjectives in the action plan. For instance,the amount of time and monetary and humanresources devoted to the implementationprocess should be quantified and not left tochance. A detailed plan of action is necessaryto ensure that the decision has been imple-mented according to plan.

Decisions are affected by several contex-tual factors, including personal preferences,urgency of the problem, and the variouspeople involved in the decision-makingprocess.8 Personal preferences, in this case,of a health care manager influence theactions that take place. There are differenttypes of managers. Some are cautious andprefer to analyze problems carefully, evenroutine ones, before taking an action. Othersare quick to respond to any type of situation.These individual preferences can affect thekind of action a problem receives. Anotherimportant contextual factor is urgency. Thepressure of impending deadlines results inquick action. Quick action consists of 3characteristics: speed, one-person decisionmaker, and limited time to search forinformation.8 Because managers are con-stantly juggling many tasks, the speed forresolving problems is rapid. Quick actionoften involves only one person making thedecision. Although a manager may receiveinput and additional information from othersin the organization, in general, the manager



has the formal authority to make the decisionand is held accountable for the action taken.When pressured to act, managers do nothave the luxury of a thorough examination ofall possibilities. Instead, managers may usethe shortcut approach and accept the firstalternative that meets the minimal criteriaand settle for short-run solutions, such asusing the satisficing approach. Quick actionrelies upon a manager who has the experi-ence and knowledge in the field and is ableto quickly acquire information to make adecision, analyze the problem to determinewhether quick action is really needed, breakdown the problem to identify which partsneed immediate action, consider the alter-natives by leaving room for change, andimplement the best alternative solutionalthough he/she knows that there are risksinvolved. Quick action should occur inurgent situations, when problems are simple,fewer people are involved, and there is noactive conflict. On the other hand, quickaction should not be used for more complexand strategic problems, when multipledepartments and people are involved in thedecision, and there is power struggle.8

E = evaluate and monitor the solution

The final step in the DECIDE model is toevaluate and monitor the solution. It is notenough to just make a decision. It is crucialto evaluate the decision made and to investi-gate ‘‘what could go wrong.’’ This step helpsto prevent, minimize, and overcome all possi-ble adverse consequences. For instance, oncethe decision is made, it may not work, andthen a manager must start over to redefinethe problem. Feedback is important becauseit provides information related to the deci-sion. Asking questions from superiors, staff,patients, and other customers are parts ofthe feedback process. Through feedback, amanager finds out whether the decision ledto the intended results. Even if the actionhas the intended effects, unintended con-sequences may also have occurred. Some-times, although a decision was correctlyimplemented, it does not last forever, and

changes are needed over time, as problemsrecur and new problems arise.

Part of the evaluation process also involvestroubleshooting. This consists of 3 basicsteps.3 First, list all the possible problemsthat could occur. Second, determine thelikelihood of each problem occurring andthe impact if it does occur, using low,medium, or high possibilities. Finally, takepreventive action to keep the potentialproblem from occurring. In this way, allpossible precautions are taken into consider-ation to assure the success of the decision.

DISCUSSION AND CONCLUSION

There is no magic or quick fix to decisionmaking. It takes a great deal of skills,knowledge, and understanding, all of whichtake practice and are accumulated over time.Nevertheless, the decision-making processand model described in this article areintended to help managers improve theirdecision making to result in more effectivedecisions. By using the DECIDE model,managers can become better equipped toact in various situations that require deci-sions to be made.

In conclusion, decision making is a skill.Managers can learn to become better deci-sion makers. Effective decision makers re-quire managers to be knowledgeable aboutthemselves and other individuals, as well aspossess technical expertise or industryknowledge. A manager who knows his/herown weaknesses and strengths and others’needs and wants is more likely to make adecision that is accepted by others. At thesame time, a decision maker can alwaysbenefit from study and practice. This articlehas introduced ideas and techniques aboutdecision making, and it is intended as aresource to focus on the crucial componentsof decision making to help a manager gaingreater understanding in the art of decisionmaking. Specifically, this article has de-scribed several scenarios and examplesbased on the health care field to promotemore skilled managerial decision makingthrough the DECIDE model.



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A Decision-Making Model for More Effective Decision Making