Different types of decisions

Different types of decisions

1. Structured problems and programmed decisions

   • Programmed decisions are concerned with the problems of repetitive nature or routine type matters.
   • Structured problems have easily and completely defined information about the problem that is available and complete.
   • Can be handled by a routine approach/Standard Procedure
     • traditionally made using standard operating procedures or other well-defined methods.
   • decisions are taken generally by lower level managers
   • The creation of these routines results in the formulation of rules, procedures and policies.
     • It's solution also heavily relies on procedures, rules and policies.
   • do not necessarily remain confined to simple issues: also used to deal with very complex issues, such as the types of tests that a doctor needs to conduct before performing a major surgery on a patient with diabetes.
   • Eg. Application for LOA

2. Unstructured problems and non-programmed decisions

   • Unstructured problems are problems that are new or unusual and for which information is ambiguous or incomplete.
     • Solution relies on judgement and creativity
       • unique decisions that require a highly skillful and well experience personals at top level management.
         • Eg. IBM introduction of a personal computer in the 1980s
   • Managers must rely on non-programmed decision making in order to develop unique solutions.
     • Upper level managers tend to deal with these decisions as it deals with the unusual or difficult decisions.
       • many management training programs on decision-making are designed to help managers think through problems using a logical, non-programmed approach to help them learn how to deal with extraordinary, unexpected, and unique problems.
   • Non-programmed decisions are unique and nonrecurring and involve custom made solutions
     • They are often ill-structured, one-shot decisions.
       • Traditionally they have been handled by techniques such as judgment, intuition and creativity
         • Eg. Tackling a company crisis