Factors Influencing Strategic Decision-Making Processes

Decision-making is one of the most important functions of managers in any kind of organization. Among different manager's decisions strategic decision-making is a complex process that must be understood completely before it can be practiced effectively. Those responsible for strategic decision-making face a task of extreme complexity and ambiguity. For these reasons, over the past decades, numerous studies have been conducted to the construction of models to aid managers and executives in making better decisions concerning the complex and highly uncertain business environment. In spite of much work that has been conducted in the area of strategic decision-making especially during the 1990's, we still know little about strategic decision-making process and factors affecting it. This paper builds on previous theoretical and empirical studies to determine the extent to which contextual factors impact the strategic decision-making processes. Results showed that researches on contextual factors effecting strategic decision-making process are either limited or have produced contradictory results, especially studies relating decision’s familiarity, magnitude of impact, organizational size, firm’s performance, dynamism, hostility, heterogeneity, industry, cognitive diversity, cognitive conflict, and manager’s need for achievement to strategic decision-making processes. Thus, the study of strategic decision-making process remains very important and much more empirical research is required before any definitive conclusion can be reached.