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Types of Decisions

Decisions may be classified according to different bases which are discussed below:

(i)    Routine and Strategic Decisions.
Tactical or routine decisions are made repetitively following certain established rules, procedures and policies. They neither require collection of new data nor conferring with people. Thus, are always one-dimensional. They do not require any special effort by the manager. Such decisions are generally taken by the managers at the middle and lower management level. Strategic or basic decisions, on the other hand, are more important and so they are taken generally by the top management and middle management. The higher the level of a manager, the more strategic decisions he is required to take. The strategic decisions relate to policy matters and so require a thorough fact finding and analysis of the possible alternative. Finding the correct problem in such decisions assumes great importance. The managers are more serious about such decisions as they influence decisions making at the lower levels.

(ii)    Policy and Operating Decisions. Policy decisions are of vital importance and are taken by the top management. They affect entire enterprise. but operating decisions are taken by the lower management in order to put into action the policy decisions. For instance, the bonus issue is a policy matter which is to be decided by the top management, and calculation of bonus is an operating decision which is taken at the lower levels to execute the policy decision.

(iii)    Organizational and Personal Decisions. Organizational decisions are those which a manager takes in his official capacity. Such decisions can be delegated. But personal decisions, which relate to the manager as an individual and not as a member of the organization, cannot be delegated.

(iv)    Programmed and Non-programmed Decisions. The programmed decisions are of a routine and repetitive nature which are to be delta with according to specific procedures. But the non-programmed decisions arise because of unstructured problems. There is no standard procedure for handling such problems. For instance, if an employee absents himself from his work for a long time without any intimation, the supervisor need not refer this matter to the chief executive. He can deal with such an employee according to the standard procedure which may include charge sheet, suspension, etc. But if a large number of employees absent themselves from work without any intimating, such a problem cannot be dealt in a routine manner. It has to be dealt with an in unstructured problem and the decision should be taken by the chief executive. Non-programmed decisions require thorough study of the problem and scientific analysis of the situational factors. There has to be adequate probing and analysis of various alternatives before taking such decisions.

(v)    Individual and Group Decisions.
When a decision is taken by an individual int he enterprise, it is known as individual decision. Such decisions are generally taken ins mall organization and in those organizations where autocratic style of management prevails. Groups or collective decisions refer to the decisions which are taken by a group of organizational members, say Board of Directors or a Committee.

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