Explain the difference between programmed and non-programmed decisions.

Programmed decisions are characterized by their routine nature and structured approach, meaning they are often based on established procedures or guidelines that can be applied consistently in similar situations. These types of decisions typically arise in familiar circumstances where the outcomes are predictable, allowing for the use of existing rules or algorithms to solve problems efficiently. For example, reordering inventory when stock reaches a certain minimum level is a programmed decision because it follows a predetermined guideline.

In contrast, non-programmed decisions are made in response to novel or complex situations that do not have clear solutions. These decisions often require a more nuanced approach, involving analysis, judgment, and creativity to navigate uncertainties. Non-programmed decisions are typically made when the stakes are higher or when the context is unique, such as deciding on a new marketing strategy for a product in a rapidly changing market.

This distinction is essential in decision-making as it helps individuals and organizations determine the appropriate approach and resources needed to address various challenges effectively.