Decision Making

Question 1

What are the types of decisions

Answer 1

• operational
• tactical
• strategic

Question 2

What are OPERATIONAL Decisions

Answer 2

• short term decisions(day 2 day)
• can be made by all staff members
• made in response to minor but sometimes important problems that arose each day or week
• carry low financial risk

Question 3

What are STRATEGIC Decisions

Answer 3

• long term decisions(effect the business for 5-10years)
• involve making decisions about general aims and targets
• take a long time to be implemented and are very difficult and expensive to reverse
• carry high financial risk
• can only be made by senior management

Question 4

What are TACTICAL Decisions

Answer 4

• medium term decisions( effect the business for 6months to 5years)
• decisions made by middle managers
• help to achieve strategic decisions
• these go into detail about what resources to achieve the business strategic decision
• have middle financial risk

Question 5

What are the ADVANTAGES of Centralised Decision Making

Answer 5

• easier to implement
• economies of scale can be achieved through centralised purchasing
• it is easier to coordinate and control
• quicker decision making

Question 6

What are the DISADVANTAGES of Centralised Decision Making

Answer 6

• there is a heavy reliance on key decision making
• lack of authority down the line may reduce manager motivation
• lower manager bet are likely to know much more about customer needs and wants

Question 7

What are the ADVANTAGES of De-centralised Decision Making

Answer 7

• decisions are made closer to customer can respond to local circumstance
• good way of trying and developing junior management
• should improve staff motivation

Question 8

What are the DISADVANTAGES of De-Centralised Decision Making

Answer 8

• most likely won’t be consistency across locations
• harder to achieve control-especially financial control
• inexperienced managers can harm the business by making the wrong decision

Question 9

How can STAFF affect the quality of decision

Answer 9

Managers ability/experience, how much risk they are willing to take, staff resistance to change

Question 10

How can FINANCE affect the quality of decision

Answer 10

Whether finance is available to address the weaknesses or for growth, financial constraints many mean that the best solution for the problem can’t be used

Question 11

How can TECHNOLOGY affect the quality of decision

Answer 11

Spreadsheets can improve accuracy, email can be used to communicate decisions and gather options on them, video-conferencing can reduce the need for travel allowing decision making meetings to take place more easily

Question 12

How cab Decision levels be measured

Answer 12

• profit levels
• sale levels
• staff absence level
• feedback from public
• researching review sites

Question 13

What is SWOT

Answer 13

A fool managers use to help decisions

Question 14

Why do managers use SWOT

Answer 14

• build on current business strengths
• minimise risk associated with making decisions
• gather and analyse information
• address any weaknesses identified
• capitalise on opportunities

Question 15

What are the roles of a manager

Answer 15

Plan 
Organise 
Command 
Co-ordinate 
Control 
Delegate 
Motivate