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TECHNOLOGY - Types of decisions
Not all decisions are alike; some involve different levels of
the organization and some are more important than others. Anthony (1965) suggests that there are
three broad categories of decision made in organizations, a model still widely
used today.
In strategic planning
the decision maker develops objectives and allocates resources to obtain
them. Decisions in this category are characterized by long time periods and
usually involve a substantial investment and effort. The development and
introduction of a new products is an example of a strategic decision.
Decisions involving
managerial control concerns the use of resources in the organization and
often include personnel or financial problem. For example, an accountant may try
to determine the reason for a difference between actual and budgeted costs.
An operational control
decision covers the day to day problems that affect the operation of the firm:
What should be produced today in the factory? What items should be ordered for
inventory?
Who makes the preponderance of each of the three types of
decisions? Anthony does not specify who handles each type of decision. However,
from the nature of the problems, we suspect that top manager in the organization
would spend more time on strategic making than supervisors, and supervisors
would be more concerned with operational decisions.
