Types of Decisions

Question 1

What are the types of decisions?

Answer 1

Strategic, Tactical and Operational

Question 2

Length of strategic decisions:

Answer 2

Long Term (10 years+)

Question 3

Strategic decision maker:

Answer 3

Senior managers e.g. BOD

Question 4

Strategic purpose:

Answer 4

Meet the overall purpose and direction of the organisation

Question 5

Strategic Risk:

Answer 5

High risk (costly to reverse)

Question 6

Strategic examples:

Answer 6

• Takeover a rival firm
• Expand into another market
• Become a multinational

Question 7

Legth of tactical decisions:

Answer 7

Medium term (1-3 years)

Question 8

Tactical decision maker:

Answer 8

Middle manager e.g. branch managers

Question 9

Tactical purpose:

Answer 9

Allow us to achieve our strategic decisions

Question 10

Tactical risk:

Answer 10

Medium risk (effects a small area of time, usually fixable)

Question 11

Tactical examples:

Answer 11

• Increase number of staff
• Open un a new outlet
• Delayer

Question 12

Length of operational decisions:

Answer 12

Short term (day-to-day)

Question 13

Operational decision maker:

Answer 13

Low level managers (supervisers)

Question 14

Operational purpose:

Answer 14

Ensure targets are met

Question 15

Operatinal risk:

Answer 15

Low risk (rectified quickly with low cost to the organisation)

Question 16

Operational examples:

Answer 16

• Schedule a meeting
• Delegating tasks
• Grant holiday leave
• Regular supply order

Question 17

What are centralised decicion making?

Answer 17

Decisions made by the senior managers
- (they carry the whole burden)
- (it is easier to promote a corperate image)
- (precedures are standardised)

Question 18

Centralised decision making advantages:

Answer 18

• Made by teh most experienced person
• Made more quickly
• Greater uniformity

Question 19

Centralised decision making disadvantages:

Answer 19

• Staff are demotivated by the lack of input
• Slower response to external factors

Question 20

What are decentralised decision making?

Answer 20

Decicion making delegated to depertments
- (subordinates make decisions)
- (decision making is faster)

Question 21

Decentralised decision making advanatges:

Answer 21

• Staff are motivated
• Response to external factors is fast
• Better customer service

Question 22

Decentralised decision making disadvantages:

Answer 22

• Decisions are made by less experienced employees
• Local divisions may be inconsistent with overall strategy