1. Investigate the situation
2. Develop alternatives
3. Evaluate alternatives and select the best one
4. Implement and follow.

Stage One - Investigate the situation
The problem solving-process begins when the problem has been identified for action. The manager's first task is to search for all the factors that may have created the problem or that may be incorporated into the eventual solution

Define the Problem
Confusion in problem definition arises in part because the events or issues that attracts the manager’s attention may differ from others. A manager may be concerned about an upsurge in employee resignation, but the increase in employee turnover is not a problem unless it interferes with the achievement of organisational objectives. If the individuals re-signing are relatively low performers and more qualified people can be readily found to replace them, the resignation may present an opportunity rather than a problem. Curing the turnover problem, then, may be the last thing the manager should do. Defining the problem in terms of the organisational objectives that are being blocked helps to avoid confusing symptoms and problems.

Identify the Decision Objectives
Once the problem has been defined, the next step is to decide what would constitute an effective solution. How will things be different when the problem has been solved? As part of this process, managers should begin to determine which parts of the problem consist of several elements, and a manager is unlikely to find one solution that will work for all of them. Manners therefore need to distinguish between their 'musts' and their 'shoulds' so that they will have a basis for proposing and evaluating alternative solutions. For example, if a manager has a staffing problem, he or she must hire someone who can do a good job in a difficult position at a certain salary - someone who has some experience and who will fit in well with others in the organisation. Managers can eliminate all candidates who do not meet their 'musts' criteria, they will evaluate all the other candidates by how well they meet their 'shoulds'.
If their solution enables them to achieve their organisational objectives, it is a successful one. More ambitious objectives, however, may be appropriate. The immediate problem may be an indicator of future difficulties that a manager can prevent by taking early action. Or the problem may offer the opportunity to improve, rather than merely restore, organisational performance.

Diagnose the Causes
When managers have found a satisfactory solution, they must determine the actions that will achieve it. But first, they must obtain a solid understanding of all the sources of the problems. What people are most involved with the problem situation? Do they have insights or perspectives that may clarify the problems? Do their actions contribute to the problem?
Causes, unlike systems, are seldom apparent, and managers have to rely on intuition. Different individuals, whose views of the situation are inevitable coloured by their own experiences and responsibilities, may perceive very different causes for the same problem. It is up to the manager to put all the pieces together and come up with as clear a picture as possible.

Stage 2 - Develop Alternatives
The temptations to accept the first feasible alternative too often prevent managers from achieving the best solutions to their problems. Developing a number of alternatives allows them to resist the temptation to solve their problems too quickly and makes reaching an effective decision more likely.
No major decision should be made until several alternatives have been developed. Problem solving at this stage frequently requires finding creative and imaginative alternatives.
Another temptation often interferes with the development of an adequate number of alternatives; the inclination to appraise alternatives as they are developed. This temptation too should be resisted. Evaluation at this stage is premature, preventing managers from generating other viable alternatives.

Stage 3 - Evaluate Alternatives and Select the Best One
Once managers have developed a set of alternatives, they must evaluate them to see how effective each would be. Effectiveness can be measured by two criteria; how realistic the  alternatives is in terms of the goals an resources of the organisation, and how well the alternative will help solve the problem.
Each alternative must be judged in light of the goals and resource of the organisation. An alternative may seem logical, but if it cannot be implemented, it is useless. For example, if sales, if sales are high but profits are declining, we may want to reduce overhead costs. But if costs have already been cut sharply, or if further cuts would reduce the quality of the product, this alternative may not be feasible. In addition, each alternative must be judged as to its consequences for the organisation. Will new problems arise when a particular course of action is followed? Managers must determine how willing their subordinates will be to carry out a decision and what might happen if the decision is not implemented wholeheartedly. Practical problems may be involved in implementing the decision, such as the need to obtain additional funding. Other departments in the organisation that would be affected by the decision, and their reactions will have to be taken into account.
Each alternative must also be evaluated in terms of how well it will achieve the 'musts' and 'shoulds' of the problem. In some cases, managers, may be able to experiment with possible solutions by trying one and more of the alternatives in different parts of their organisation to see which is most effective. But usually they will simply use their knowledge, judgement and experience to decide which alternatives are most attractive.
The selected alternative will be based on the amount of information available. More likely than not, the selected alternative will also represent a compromise among the various factors that have been considered.

Stage 4 - Implement and Monitor the Decision
Once the best available alternative has been selected, managers must make plans to cope with the requirements and problems that may be encountered in putting it into effect.
Implementing a decision involves more than giving appropriate orders. Resources must be acquired and allocated as necessary. Managers set up budgets and schedules for the actions they have decided upon. This allows them to measure progress in specific terms. Next, they assign responsibility for the specific tasks involved. They also set up a procedure for progress reports and prepare to make corrections if new problems arise. Potential risks and uncertainties have been identified during the earlier evaluation-of-alternative stage, and these must be kept in mind. There is a human tendency to forget possible risks and uncertainties once a decision is made. By taking extra time to re-examine their decision at this point and to develop detailed plans for dealing with these risks and uncertainties, managers can counteract this tendency.
After managers have taken whatever steps are possible to deal with adverse consequences if they arise, actual implementation can begin. A frequent error of managers is to assume that once they make a decision, action on it will automatically follow.

There are five key questions in Effective Problem Solving & Decision Making that one must ask to understand the problem better and therefore leads to making good decisions. The 5 questions are:

1. What is the heart of this issue or problem?

1. Past experience can become a trap when it becomes a rigid way of seeing and interpreting work situations.
2. The above restricts vision and blocks you from making innovative and effective decisions.
3. Do not assume that new problems are in some way identical with old ones.
4. The solution is to Pause, side step old habits, and be Open minded in analysing the new issues,
5. Ask yourself the following questions before attempting to solve the problems or making the decision. E.g. What is the purpose of solving this problem? Or What is the greater benefits to the derived from solving the problem in relation to the immediate "conflict" caused, if any.
6. The Japanese methodology. The important element in decision-making is defining the question. The crucial steps are to decide whether there is a need for a decision, and what the decision is about.
7. Don't be biased - again this is a trap, which will hinder you when trying to get to the root of the issue.

1. Be prepared to get the view from the other side
2. Seek more information and do not rely on the information readily available.
3. The key to becoming a master manager is seeing past your own blinders and the blinders imposed by the expectation of others.
4. Distorted thinking is contagious. I f you consistently respond to things negatively , this can actually amplify your feelings of helplessness and spread to other areas of your life.

3. How important is this going to be in the long run?

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Nobody understands (yet) how your brain a physical thing – can produce an idea – something that is not physical. All we know is that it happens. Perhaps it happens to you less often than to other people, but since it has happened to you a few times we know that there's no physical deficiency - no genetic mutation in your brain, for example - that's preventing you from getting ideas. You can get them. So if you feel less creative that you might be, the only thing we have to figure out is why you're getting too few ideas and then work on getting more.
When I was a kid I hung around with a guy named Johnny-Boy Boyd. JB was a klutz. Accidents just seemed to happen to him; if one didn't run into him, he ran into it. Nowadays psychologists would say that subconsciously JB made accidents happen, that it was his way of getting attention. Back then we just called him 'accident prone' and let it go at that.
As an adult I hung around with people who were 'idea prone'. Ideas just seemed to happen to them the way accidents happen to JB. And the psychologists would probably say the same thing about them that they said about JB - that subconsciously they made these things happen, that it was their way of getting attention.
I disagree. I do not think that the idea-prone people I hung around with were born with some special kind of ideation talent, or some unique way of thinking that led them down untrodden paths.

Know they're out there 

            The thing that sets them apart is this – the ones who come up with ideas know that ideas exist and know that they will find those ideas; the ones who don’t come up with ideas don’t know that they will find ideas.
Let me tell you a story. For over 20 years I worked for the advertising agency that did the advertising for Smokey Bear - the US fire safety campaign. The first thing the wtiters and art directors had to do every year was to come up with a basic poster. The rules for the poster never varied - it had to be a certain shape and size; it had to feature Smokey; it had to be simple enough to grasp at a glance, clear enough for even a dunce to understand and (if it had words) brief enough to read in three or four seconds.
The mission of the poster never varied either - it had to convince people to be careful with fire. In other words every year we had to come up with the same thing only different. And we did. Indeed, every year we came up with 20 or 30 different ideas for posters. Every year. For over 20years. Over 500 posters all featuring Smokey and all trying to do the same thing and not one of them the same. And as far as I know the writers and art directors at that agency still have the same rules for the Smokey poster and are still coming up with ideas. So don’t tell me there’s only one or two ways to solve a problem. I know differently.
When you're not sure an answer exists, finding it can be hard. When you know there are many answers, finding one or two is easy. That's one of the reasons some people always seem to get ideas - they know they're around. If you want to become idea prone you must accept two things. First, you must accept that what you think about yourself is the single most important factor in your success. Your personality, your actions, how you get along with others, how you perform at work, your feelings, your beliefs, your dedication, your aspirations, even your talents and abilities are affected – no, controlled – by your self-image.
If you think of yourself as a failure you will probably become a failure. If you think of yourself as successful you will probably become successful. How else can you explain why seemingly gifted people fail while seemingly deprived people succeed? 'They can do it all because they think they can', said Virgil, and this fundamental fact about the triumph of self-image is as true today as it was 2,000 years ago.
In short - attitude is more important than facts. Specifically this means that for the most part the difference between people who crackle with ideas and those who don’t has little to do with some innate ability to come up with ideas.
Second, you must accept that human beings can alter their lives by altering their attitudes. This what many people, perhaps yourself included, refuse to accept. You accept that your self-image drives your life, but despite all the evidence cited by sages and clergymen and doctors and philosophers and psychologists and teachers and therapists and coaches, despite the thousands of real-life examples in the hundreds of self-improvement books, you reject the notion that you can change your own self-image.
You are wrong. You can change it. You seem to think that you can't think differently in your heart, that the way you think today is locked in stone forever. But you are wrong. You can think differently. Everybody accepts now that the mind alters how the body works. The evidence  that it can and does is simply overwhelming. Drug addicts take placebos and have no withdrawal symptoms, allergy sufferers sneeze at plastic flowers, unloved children physically stop growing, hypnotised patients undergo surgery without anaesthesia – the examples are legion
But when you think about it, accepting the concept that one thing, (the mind) can alter another thing (the body) is a major leap. All I'm asking you to accept is a minor leap - that the mind can alter the mind.
Accept it. It's a fact. And then start altering your self-image. If you tell yourself that you 'never get ideas', you never will. Instead, tell yourself everyday that you are a font of ideas, that ideas bubble forth from you like water from a spring. Every day. No, many times every day. Eventually you will begin living up to this new mental image you have created of yourself.

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