Programmed and Non Programmed Decision Making

1. Compare and contrast programmed and nonprogrammed decision-making in organizations and give two realistic business examples of each of these two types of decision-making.

Programmed decision are decisions that have been made so many times in the past that managers have developed rules or guideline to be applied when certain situations are expected to occur. Programmed decision making is used when an inventory manager of mc Donald’s decides to order beef patty stocks because the stocks are three-quarters empty. Programmed decisions making are a routine that you make every time so that the organization run smooth. Managers can develop rules and guidelines to regulate all routine organizational activities. Most decisions are related to daily activities.

On the other hand , nonprogrammed decisions are made in response to unusual opportunities and threats. Nonprogrammed decision making is used when mc Donald’s are deciding to invest in new deep fryers. It is a nonroutine decision making . This means it is made for big decisions that will affect an organization for a long time. This type of decision making does not need rules or guidelines to be followed because the situation is unexpected or uncertain. For example if mc Donald’s plans to launch a new line of menu, they will have to make decision base on their intuition and reasoned judgments.

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. Nonprogrammed decision making are likely to have error because it causes more problems for managers and is inherently challenging. Managers must rely on their intuition to quickly respond to a pressing concern.

Sometimes programmed decision making can cause error. But it is minor to nonprogrammed decision making . Errors cause by nonprogrammed decision making can affect an organization badly. For example if mc Donald’s decided to invest in a new menu. Their customers did not like the new menu and they do not consume mc Donald’s anymore. This will affect mc Donald’s revenue and profit.

If the error is caused by programmed decision making, the lost is not big compared to nonprogrammed decision making. Lets say that the big mac that mc Donald’s cooked exceed the supposed number. That means extra big macs and they can’t sell these big macs tomorrow morning. So there might be some lost there but the employees can still take it home after closing.

Programmed decision making are always used in daily routine to keep the organization running smooth. That is why they have rules and guidelines to make a decision. Nonprogrammed decision making are not always used but it will give impact to an organization’s effectiveness. This decision is made on reasonable judgment and the circumstances if we proceed with the decision.

2. There are two important techniques that managers can use to promote creativity in group decision-making situations

As we discussed , we have decided to choose between three of these restaurants to open in a centrally located shopping center in Shah Alam. We have decided to open either a fast food franchise , an Italian fine dining restaurant or a family friendly restaurant that servers Kelantan cuisine.

The pros for fast food franchise is kids love fast food. So these kids will drag their parents