Types of Decisions

• Programmed Decisions

These are standard decisions which are routine and repetitive in nature. Such decisions have short term impact and are relatively simple. These decisions require little thought and judgment. For this kind of routine, repetitive problem, standard arrangement decisions are typically made according to established management guidelines. In programmed decision making there will be no error in the decisions because it is a routine and managers usually have the information they need to create rules and guidelines to be followed by others. But sometimes it can cause error but not of big kind. Programmed decision making are always used in daily routine to keep the organization running smooth.

• Non - Programmed Decisions

These are non-standard and non-routine. Each decision is not quite the same as any previous decision and is typically one shot decisions that are usually less structured than programmed decision. They are made in response to situations that are unique, poorly defined and largely unstructured. This means it is made for big decisions that will affect an organization in the long run. This type of decision making does not need rules or guidelines to be followed because the situation is unexpected or uncertain. Non-programmed decision has more chance of errors and is difficult for managers to handle as it is inherently challenging. Managers must rely on their intuition to quickly respond to a urgent concern. Also these errors are of dangerous kind, they affect organization badly. This decision is made on reasonable judgment and the circumstances if we proceed with the decision.

• Strategic Decisions

Strategic decisions are the decisions that are concerned with whole environment in which the firm operates the entire resources and the people who form the company and the interface between the two. These decisions affect the long-term direction of the business and are taken in accordance with organizational mission and vision.

• Tactical Decisions

Tactical decisions support strategic decisions. They tend to be medium range, medium significance, with moderate consequences.

• Operational Decision

These are short-term decisions as opposed to the longer-term strategic decisions, also called administrative decisions involving routine tasks.