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486 Part Three Key System Applications for the Digital Age

FIGURE 12.1 INFORMATION REQUIREMENTS OF KEY DECISION-MAKING
GROUPS IN A FIRM

Senior managers, middle managers, operational managers, and employees have different types of
decisions and information requirements.

Unstructured decisions are those in which the decision maker must
provide judgment, evaluation, and insight to solve the problem. Each of these
decisions is novel, important, and nonroutine, and there is no well-understood
or agreed-on procedure for making them.
Structured decisions, by contrast, are repetitive and routine, and they
involve a definite procedure for handling them so that they do not have to be
treated each time as if they were new. Many decisions have elements of both
types of decisions and are semistructured, where only part of the problem has
a clear-cut answer provided by an accepted procedure. In general, structured
decisions are more prevalent at lower organizational levels, whereas unstruc-
tured problems are more common at higher levels of the firm.
Senior executives face many unstructured decision situations, such as
establishing the firm’s 5- or 10-year goals or deciding new markets to enter.
Answering the question “Should we enter a new market?” would require access
to news, government reports, and industry views as well as high-level summaries
of firm performance. However, the answer would also require senior managers
to use their own best judgment and poll other managers for their opinions.
Middle management faces more structured decision scenarios but their
decisions may include unstructured components. A typical middle-level
management decision might be “Why is the reported order fulfillment
report showing a decline over the past six months at a distribution center
in Minneapolis?” This middle manager will obtain a report from the firm’s
enterprise system or distribution management system on order activity and
operational efficiency at the Minneapolis distribution center. This is the
structured part of the decision. But before arriving at an answer, this middle
manager will have to interview employees and gather more unstructured infor-
mation from external sources about local economic conditions or sales trends.

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