What is an operational decision?
Operational decisions are at the heart of any organization, whether it is a business, a government institution, or even a nonprofit. They are essential to ensure the proper daily functioning of these entities. But what exactly is an operational decision? Discover in this article the fundamentals of operational decisions and how transition management can occupy a crucial place in this process.
Definition of Operational Decisions
Operational decisions are choices made by an organization’s managers to govern daily activities and internal processes. They are focused on completing tasks and solving immediate problems. Not to be confused with strategic decisions that focus on the long-term vision and overall direction of the organization.
Operational decisions contribute to the smooth daily running of a business through their ability to maintain stability, manage resources and ensure overall business performance. These decisions help meet daily challenges, maximize the efficiency of internal processes and respond to changing market needs.
The Actors of the Operational Decision
Decision-making involves many people and levels of responsibility, each with a particular role.
Key players involved in operational decisions
Operational decisions are made at different levels of the organization:
- General management : the general management of the company is responsible for the overall vision of the organization. She makes strategic decisions that affect the entire company.
- Operational managers : Operational managers are responsible for implementing strategic decisions at the operational level. They supervise daily activities, set goals, and make decisions to achieve those goals.
- Field employees : These are all the people who carry out daily operational tasks. Their experience and expertise are essential in providing valuable information for decision-making.
- Support services : Departments such as human resources, finance, and IT provide essential information and services to support operations.
Roles and responsibilities of operational managers
Operational managers play a central role in operational decision-making. Their responsibilities include:
- Planning : operational managers develop detailed plans to achieve the objectives set by general management. They set priorities, allocate resources and establish schedules.
- Implementation : They oversee the implementation of operational plans, ensuring that employees perform tasks efficiently and in accordance with company standards.
- Monitoring and controlling : Operational managers monitor performance, identify potential problems and take corrective action when necessary.
- Communication : they ensure the transmission of essential information between general management and field employees.
Collaboration between different levels of management to make effective decisions.
For better collaboration between different management levels, top management must work closely with operational managers to ensure that strategic decisions are implemented adequately. This collaboration is achieved through open, transparent communication and alignment of objectives.
The operational decision-making process
Operational decision-making is an iterative process that requires reflection, strategy, and above all, clear steps to arrive at the best solution.
- Identify the problem or decision to be made : this could be an operational challenge, an opportunity to be seized or a situation that requires a response.
- Collect relevant data : once the problem has been identified, you need to collect the relevant data. This can include internal company information, such as financial data or performance reports, as well as external data, such as market or competitive information. The more complete and accurate the data, the better.
- Analyzing available options and decision making : This step often involves weighing the pros and cons, considering the risks and opportunities, and determining the best possible option.
- Implement the chosen plan : you must now put in place a concrete action plan to implement the decision. This step involves allocating resources, defining objectives, creating schedules and designating those responsible.
- Evaluate results : Once the plan is in place, it is essential to monitor and evaluate the results. This makes it possible to check whether the decision taken was effective and whether the objectives were achieved. If necessary, adjustments can be made to improve performance.
Operational decisions can take many forms, such as inventory management, schedule planning, resource allocation, cost management, etc. For example, the decision to reorganize the supply chain to reduce costs is a common operational decision.
The impact of operational decisions
Operational decisions have a direct impact on the overall performance of the company . A series of good operational decisions can improve the efficiency, productivity and profitability of the organization. On the other hand, bad decisions can lead to financial losses, a decline in the quality of products or services, or even a loss of customers.
A good operational decision could be the adoption of new technologies to automate production processes , which increases efficiency and reduces costs. On the other hand, a poor operational decision could be to neglect preventative equipment maintenance, leading to costly downtime.
Challenges and strategies in operational decision-making
Operational managers often face challenges such as managing limited resources, pressure to maintain quality while reducing costs, and the need to make rapid decisions in changing environments .
To overcome these challenges, skills can be developed including time management, problem solving, communication, agility and leadership. Additionally, data analysis and the use of advanced technologies can help make more impactful decisions.
In summary, operational decision-making is based on a structured process, in-depth reflection, and constant evaluation of results. To make the best decisions, you have to be flexible and adaptable. Interim management offers valuable expertise to guide organizations through these pivotal decisions and help them thrive in an ever-changing world. Ultimately, effective operational decision-making is essential to maintaining the long-term success of any organization.
