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CS Professional · Strategic Management and Corporate Finance · Introduction to Strategic Management

Which of the following best describes the nature of strategic decisions as distinct from operational decisions in an organisation?

Strategic decisions are long-term, commit significant resources, affect the organisation as a whole and are taken under uncertainty. Routine, easily reversible, department-level choices such as daily scheduling are operational decisions, not strategic ones.

  1. AThey are routine, repetitive and taken by supervisors to meet daily targets
  2. BThey are long-term, resource-committing, and have organisation-wide impact with significant uncertaintyCorrect
  3. CThey deal only with the day-to-day scheduling of production
  4. DThey are reversible at negligible cost and affect only one department

Explanation

Strategic decisions commit substantial resources, look to the long term, affect the whole organisation and are taken under uncertainty. Routine, repetitive and departmental decisions are operational in nature, so the other options describe operational decisions rather than strategic ones.

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