How Do Nonprogrammed Decisions Differ from Programmed Decisions?

When problems are unstructured, managers must rely on nonprogrammed decisions in order to develop unique solutions. Examples of nonprogrammed decisions include deciding whether to acquire another organization, deciding which global markets offer the most potential, or deciding whether to sell off an unprofitable division. Such decisions are unique and nonrecurring. When a manager confronts an unstructured problem, no cut-and-dried solution is available. A custom-made, nonprogrammed response is required.

The creation of a new organizational strategy is a nonprogrammed decision. This decision is different from previous organizational decisions because the issue is new; a different set of environmental factors exists, and other conditions have changed. For example, Amazon’s strategy to “get big fast” helped the company grow tremendously. But this strategy came at a cost—perennial financial losses. To turn a profit, CEO Jeff Bezos made decisions regarding how to organize orders, anticipate demand, ship more efficiently, establish foreign partnerships, and create a marketplace for other sellers to sell their books on Amazon. As a result, Amazon has moved toward profitability.

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