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Types of decision making - Non-programmed decision making

Definition of decision making
Decision making represents a process of choosing the best alternative from among many possible options available to the manager of a business unit. A manager at any given moment of making a decision concerning the business would first of all assess all the different alternative decisions which the business can take. Each of these alternative decisions will be looked at in terms of their advantages and disadvantages which are known to the managers of the business. From this evaluation, a final decision may be arrived at. Weighing the merits and demerits of each choice or option helps the managers of the company to make the best decisions.

One must bear in mind that decision making is an important function of management. Without this managerial function of decision making, other functions of management such as planning, directing, organizing and staffing cannot be performed because each of these function involve making decisions. In the words of Stephen Robins, “decision making is the selection of a preferred course of action from two or more alternatives.”Non-Programmed decisions are made in unstructured situations which reflect new situation because these situations don’t happen frequently and are also complex in nature.

Decision making can be categorized into two main types; Programmed decision making and non-programmed decision making.

Non-Programmed decisions are made in unstructured situations. Unstructured situations reflect new dimensions because these do not happen frequently and they are also complex in nature.

Since these problems rarely happens or have never happened before, they need a lot of brainstorming to have it solved. In these kinds of situations, managers rely on a combination of skill, subjective judgment, a great deal of scientific analysis and a considerable amount of logical reasoning.

Subjective judgment is needed to evaluate the situation. Non-Programmed decisions carry in them a fair degree of uncertainty because while in the view of the manager the decision is meant to address the problem, the outcome is seldom known or is always not known; principally because they are taken in the context of a dynamic business environmental conditions.

By way of example, let us take a situation where a manager takes a decision to increase the advertising expenditure of a business, undertake a coaching in effective salesmanship for his staff, upgrade the technology used in producing his product, yet he notices that profit margins are still falling. A situation of this nature requires immediate action and such decision may be non-programmed.

The various kinds of non-programmed decisions include: Personal decisions, Strategic decisions, Crisis intuitive decisions, and Problem-solving decisions.

We can summarize the main features of non-programmed decision as follows:

  • Situations which require that a non-programmed decision be taken are unique and ill-structured or unstructured
  • Non-programmed decisions are usually one off decisions.
  • They make managers rely on intuition and subjective judgment, personal intuition, and innovativeness.
  • A non-programmed decision is taken when there are extraordinary and unexpected problems.
  • A non-programmed decision involves a combination of common sense and trial and error.

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