Types of Decisions

 

Types of Decisions  :

1)      Programmed and Non-Programmed Decisions: Programmed decisions are of repetitive nature concerned with routine type of problems. These decisions are taken normally by lower level of managers. Such decisions have short-run impact. As they are concerned with routine matters of less importance, managers should not spend much time in respect of such decisions. In fact, specific policies and procedures should be fixed for taking such decisions. Eg. Purchase of low priced stationery, granting a leave to an employee. 

Non-programmed decisions are novel or new decisions taken in respect of special types of problems. These decisions are normally taken by top management. For eg. Introduction of new product in the market, offer of bonus shares to the shareholders.  

2)      Major and Minor Decisions: Depending upon the importance or possible effect on the organization as a whole, decisions may be classified as major and minor decisions. For eg. Deciding the location of the new plant, stopping the production of product item which id failed in the market etc. are major decision, while deciding to change the interior decoration office is minor decision.

3)      Individual and Group Decisions: Individual decision is taken by in individual person and may be a simple and routine nature. Group decisions are taken by group or by a committee constituted for the specific purpose. Normally these are important decisions.

4)      Departmental and Organizational Decisions: Depending upon the functional area of departments, the decisions can be classified as production decisions, marketing decisions, etc. For ex. Marketing decisions are concerned only with the marketing activities of the organization. Organizational decisions, however, affect the entire organization such as decision to give promotion on the basis of seniority.

5)      Strategic and non-strategic decision : We have seen that strategic decisions are mostly long range decisions. They are associated with the time-to-time strategy the management adopts. Such decisions have strong impact on the organization as a whole and must be taken very carefully. For example, if the company has been receiving making orders for the one of their product consistently which will over cast the plant capacity, then the company has to take strategic decisions amongst alternatives. They are

i.                    To given the product on loon license to others.

ii.                  To put the staff on overtime for additional work.

iii.                To start extra shift.

iv.                To build additional capacity.

Any of the above four decisions are strategic because they will have the long-range impact on the organization. For example, the last decision may involve selling and sustain subsequently. A review of literature brings to light that many authors have classified decision in many ways perhaps they can be of the types of new wine in the old bottle or the old wine in the new bottle.


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