Types of Decisions by Managers

By | April 6, 2020

Routine Decisions: These are the day to day decisions taken by lower level and middle-level managers. They are taken after analysing the already laid procedures, rules and policies. The middle-level managers use the standard policies set by the top-level management as a benchmark to derive at a certain choice. They are also known as tactical decisions. They can be easily delegated to the subordinates as they are mostly programmed. The results or outcomes of routine decisions or tactical decisions only affect a small portion of the organisation.

Strategic Decisions: These decisions taken by the managers which are very crucial for the growth of the organisation. They deal with policy formulation, developing new business models, analysing the environment and various alternatives in order to derive one outcome. Strategic decisions are generally taken the top-level managers. The outcomes of such decisions affect the health of the entire organisation. They cannot be delegated to the subordinates.

Programmed Decisions: These are the day-to-day decisions taken by the manager takes after considering the rules of the organisation. Various procedures and rules are laid down beforehand in order to guide the manager while making decisions. It defines how the manager is programmed to make decisions.

Non-programmed decisions: These are the decisions to combat the non-recurrent problems of the company. They are undertaken to resolve exclusive and uncommon problems of the company. Such problems are complex and options cannot be ascertained in advance. These are no handy solutions. These decisions are highly significant for the growth of the company. Top-level management engages in non-programmed decisions.

Irreversible decisions: These decisions which cannot be upturned or changed.

Reversible decision: These decisions that can be changed after their implementation. When McDonald faced criticism for selling beef in India, it quickly discontinued its sales.

Individual decisions: When the decision-maker makes a decision on his own then it is called individual decision-making. In the case of the sole proprietorship or where the subject matter is not very complex, the decisions are made by the owner of the company only.

Group decisions: Here, the decisions are made by a group of managers and persons. This type of decision-making is done when the problem is complex and vast, and it also requires specialist knowledge of different individuals. The decisions of the committee, task force or board of director are part of group decision-making. They generally comprise of relevant problems which require specialised and mutual discussion.

Authoritative decision: It is a style of making decisions that are derived at the top. The president or CEO makes a decision that is to be followed by all the subordinates it is called authoritative decision making.

Facilitative decision: Here the superior and the subordinate jointly collaborate and come to a single outcome.  The head of the departments, workers and employees have primary information about customers, processes and market trends, whereas the top-level management has expertise and knowledge. This amalgamation of facts and knowledge leads to better decision making.

Consultative decisions: This is the form of facilitative decision-making. However, here the final decision is made by the higher authority only. The manager/decision-maker will ask for the advice from the employees and various de.partmental heads but the decision will be made by him individually

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