In February 1913 a subordinate committee of the Ministry of Education was established. Called the Committee for the Unification of Pronunciation, they were tasked first and foremost with determining the pronunciation for all words in the national standard language (國語). As part of that function, they were also to determine the number of phonemes used in the language and to then adopt an appropriate phonetic alphabet.
The committee had 45 members, selected to represent the various provinces and districts in China and thus represent the substantial linguistic variety of China. They were also tasked with determining just which Sinitic language was to become the national standard. Dashan has already addressed the chances Cantonese had at this position, so I’ll skip that part. Cantonese was considered, but not seriously.
The finally decided upon national standard was an artificial variety of Mandarin based upon a long-used lingua franca sometimes referred to as lánqīng guānhuà (藍青官話), lánqīng here being a reference to the multitude of other dialectal influences on this speech.
The newly chosen form of Mandarin has a few key features, meant as concessions to speakers of the southern languages. It was meant to convey the total range of distinctions found in other non-Mandarin languages, including the entering tone as well as mid vowels /o/ and /e/ which are not present in some of the more northern dialects of Mandarin.
The language was decided upon, and the Guóyīn Zìdiǎn was published in 1919 as a record of this standard. But despite being well received and widely agreed upon, this standard was not without problems. Most significant of all was that there were no native speakers of this new variety, and thus no native teachers. As a result, teaching of the dialect was inconsistent.
In 1932, after a mildly problematic decade, the Guóyīn Zìdiǎn was revised without ceremony or much in the way of public announcements. A new version was published reflecting instead the educated speech of Beijing, thus ending the short run of the new national language.