ACCA Performance Management (F5) Certification Practice Exam

What are the levels of management decision-making?

1. Operational, Administrative, Supervisory

2. Strategic, Tactical, Operational

3. Immediate, Short-term, Long-term

4. Planned, Adaptive, Reactive

The correct answer is: Strategic, Tactical, Operational

The levels of management decision-making are categorized into strategic, tactical, and operational levels, each serving a distinct purpose in the organization’s hierarchy. Strategic decision-making occurs at the highest level of management and involves long-term planning and defining the overall direction and goals of the organization. This includes decisions like entering new markets, developing new products, or making significant investments. Such decisions are often made by senior executives and shape the future of the organization. Tactical decision-making is the middle level, where managers translate the strategic goals into specific actions. These decisions are typically medium-term and may involve resource allocation, budgets, and policies for different departments. Tactical management is essential for ensuring that the strategic plans are effectively implemented on the ground. Operational decision-making is concerned with day-to-day operations and short-term activities. It involves decisions that help run the organization smoothly on a day-to-day basis, such as scheduling, staffing, and quality control. This level ensures that the tactical plans are executed efficiently. Understanding these levels of decision-making is crucial, as they reflect the progressive nature of management functions and help in effective organizational planning and performance monitoring. Each level plays a vital role in achieving the organization’s broader objectives by ensuring that strategic directions are translated into actionable tactics and operational activities