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      Question

      Which of the following is not an operational

      decision?
      A Determining how much inventory to keep on hand Correct Answer Incorrect Answer
      B The nature of a marketing campaign Correct Answer Incorrect Answer
      C Deciding the components and raw materials to buy from suppliers Correct Answer Incorrect Answer
      D Deciding the location of the plant for optimal distribution of products Correct Answer Incorrect Answer
      E All are operational decisions Correct Answer Incorrect Answer

      Solution

      Operational decisions are determinations made in regard to the routine, ongoing activities in the functional areas of an organization. These relate to day-to-day functioning or operations of business. Middle and lower-level managers take these decisions. Strategic decisions are important decisions which affect objectives, organisational goals, and other important policy matters. These decisions usually involve huge investments or funds. These are non-repetitive in nature. Deciding the location of the plant is a strategic decision to optimally manage the logistics cost and manage the supply chain efficiently. These decisions involve huge investments, made by the firm, in acquiring building(s), arranging and installing plant and machinery.

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