Business Decisions

Business Decisions

Business Decisions Jonathan Poland

A business decision is a commitment made by a company, team, or individual employee to a specific course of action. Business decisions are also important for adapting to changing market conditions and customer needs. As the business landscape evolves, companies need to be able to make timely and effective decisions in order to stay competitive and relevant. This might involve things like responding to new competitors, adopting new technologies, or changing the focus of the business in response to shifts in customer demand. By making well-informed and strategic decisions, businesses can position themselves for success and growth.

Some common types of business decisions include:


A strategic decision is a plan that influences the future of a business. For example, a restaurant that makes a decision to expand its seating by investing in an outdoor patio.


A tactical decision is a timely response to business conditions. For example, a decision to cut prices in response to price competition.


Decisions that relate to your core revenue generating business processes. These are often closely measured, optimized and validated with testing. For example, a restaurant chain that decides to experiment with reorganizing its kitchen to try to decrease order turnaround time.

Programmed Decisions

Programmed decisions are repeated decisions that are handled by processes, policies, procedures and automation. For example, a bank that sets bright line rules for what types of houses they will mortgage.

Policy Decisions

A policy decision is a decision to change a programmed decision. For example, a bank that establishes a new process for reviewing non-standard houses that expands coverage to unique properties.

Ungoverned Decisions

Decisions that are made automatically by artificial intelligence without human oversight. For example, an artificial intelligence that rejects some houses in a mortgage application because its models don’t understand them or view them as a risk.

Management By Exception

Management by exception is the practice of automating most decisions but providing management attention to exceptional circumstances. For example, a hotel that empowers all front desk staff to move a guest who is unhappy with their room upon check-in but requires a manager’s approval to refund the room.

Multidisciplinary Decisions

Decisions that require different types of professional opinion. For example, the interior design of a hotel that involves architects, interior designers, construction managers, hotel operations managers and brand managers that each look at the design from different perspectives.

Customer Advocacy

It is common for an organization to employ customer advocates who engage with customers including responding to reviews and comments in social media. Customer advocates are then given broad access to design, quality and policy meetings where they represent the interests of the customer as opposed to the firm.

Team Decisions

Decisions that are relevant to the culture of an organization or team. For example, hiring decisions can influence the dynamics of a team.

Reputational Decisions

Decisions that may build a reputation or destroy it. This includes how you treat people and the environment. It also includes decisions in areas such as product quality, service quality and terms & conditions. For example, a telecom company that cuts customer service staff in order to increase wait times for customers who want to cancel their service.

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