Decisions, decisions,
decisions…that is the question. Many different people at varying levels within
a company make thousands of decisions every day. The value of information
technology and its ability to assist managers and employees with pertinent data
that helps them make better decisions is priceless. Some companies have tried
to determine the return on investment but it’s very difficult to do considering
how many decisions are made on a daily basis. However, it’s safe to say that
millions of dollars can be saved if you have accurate and timely information
when making a split second decision.
There are three types of decisions
and the first is unstructured decisions. “Unstructured decisions are those in
which the decision maker must provide judgment, evaluation, and insight to
solve them problem” (Laudon 456). An example of unstructured decisions are the
types of decisions often made by senior management such as capital budget
approval, long-term goals, investments, and the overall direction of the firm.
The second type of decision is a structured decision and this type is opposite
of the unstructured decisions. Structured decisions are routine and occur
everyday. They also have clearly defined policies and procedures in place. I
would call these the mundane tasks that don’t require a lot of input but still
require someone to make the decision. Examples would be restocking inventory
and determining overtime eligibility. The third type of decision is a combination
of structured and unstructured and it’s called semi structured. Semi structured
decisions are often made by middle management and do not always have a set
answer or procedure to follow. Examples of a semi structured decision would be
more creative services such as developing a marketing plan or designing a
website. Also, creating a departmental budget would be a good example because
there is room to make mistakes and try new ideas but there are still basic
guidelines to follow.
There are four stages to the
decision making process in which an employee would ask themselves, what is the
problem? What are the possible solutions? What is the best solution? Is the
solution working? Can we make it better? These questions stem from the decision-making
stages: intelligence, design, choice, and implementation.
Lastly, there are different types
of decision support for the different types of decisions. Middle management
typically uses management information systems (MIS) to assist them with structured
decisions. The decision support offers a variety of reports needed for the
middle manager, whether it’s a report for daily activity in the warehouse or
how many customers visited the restaurant. In addition to individual decision-making
support systems, there is also a system for groups called group decision–support
systems (GDSS).
Source: Laudon, Kenneth C. &
Jane P. Laudon. Management Information
Systems: Managing the Digital Firm 12th ed. Pearson Hall, 2010.
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