Essay on Ib 1.6 - Organisational Planning Tools

2201 Words Aug 8th, 2013 9 Pages
Review Questions 1.6 1. Explain the meaning of ‘operational’, ‘tactical’ and ‘strategic’ decision-making.
Operational Decisions refer to the routine and day-to-day decisions, such as those handled by junior management, e.g. deciding when a worker should go for their break and how to deal with customer enquiries and complaints
Tactical Decisions refer to regular and short-term decisions that are normally handled by middle management, e.g. decisions about pricing strategies or recruitment and selection of staff
Strategic Decisions refer to high-level and long-term decisions that set the overall direction for a business. Such decisions are dealt with by senior management since they carry more risk, e.g. which products to be developed,
…show more content…
This will involve devoting time, people and money to tackling weaknesses and threats * SWOT Analysis is not typically used in isolation. Businesses are usually able to make better decisions if they have more information available; thus the use of other strategic tools such as PEST Analysis should also be used 6. What are ‘decision-making frameworks’ and why do businesses use them?
Businesses have to make decisions in order to achieve their organisational objectives. Typically, a business will have to decide: * What production should take place, e.g. Which goods or services to produce or supply? * How production should take place, e.g. What combination of capital and labour should be used? * For whom production should take place, e.g. Only for those with high disposable incomes?
A decision-making framework is a systematic process of dealing with business problems, concerns or issues in order to make the best decision. In a simple decision-making model, the following seven steps take place: 1. Identify the business problem, concern or issue (linked to the objectives of the organisation) 2. Gather sufficient data and information to produce a list of possible options 3. Assess the consequences (in terms of costs and benefits) of each option 4. Select the most favourable option, in

Related Documents