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The decision analysis and its name indicates a method used to structure the decision-making process.

Introduction

The decision analysis used to structure the decision-making process. It helps to clarify the objective, to assess the risks and benefits to make the best choice.

Step 1-Definition of decision

The decision-making framework is defined. We will describe the context and the decision that we will have to make.

Step 2-Define objectives

Second step, we list the objectives of this decision making. We prioritize them according to 2 classes:

  • the necessary expectations: These are the objectives that we must achieve.
  • Operational expectations: These are the objectives related to the situation that we would prefer to have, but which cannot be considered as mandatory. They will be given a ” weight ” of prioritization.

 

Finally, we indicate the constraints of our system: these are the elements for which we will not be able to do anything, because mainly due to legislation or means that we do not have.

Step 3 – List the alternatives

We are here in a phase of creativity. We generate as many alternatives as possible, even if these can be improbable see infeasible.

Step 4 – Test alternatives

We then test all the alternatives to the expected objectives of this decision-making. We will eliminate alternatives that do not meet the required objectives. Then we will do the evaluation by comparing it with the operational objectives. They will be evaluated via a scale of 1 to 10.

Example:

Weight

Alternative 1

Score 1

Alternative 2

Score 2

Alternative 3

Score 3

Expectation 1

6

4

24

8

48

1

6

Expectation 2

2

7

14

3

6

3

6

Expectation 3

8

7

56

2

16

8

64

Expectation 4

4

2

8

7

28

8

32

102

98

108

Score the alternatives to objectives one by one via a scale from 1 to 10.

Identify the final score by multiplying the weight of each goal by the score.

Step 5 – Take the decision

Last step, we take the 2 – 3 alternatives having the most important previous score, then identify the potential problems or the negative effects of each one. A table like this is built for each of the selected alternatives:

Adverse reaction

Probability

Importance

Score

A

3

9

27

B

7

4

28

C

7

3

21

76

Then, a ratio is calculated by dividing the score obtained from the side effects by the score obtained in step 4. In essence, we will choose the alternative with the smallest score, since it is the one that offers the most advantage for the least of adverse effects.

Taking our example, the decision ratio for alternative 1 is 76/102 = 0.745. This ratio will be compared to the others.

Once the decision is taken, the method asks to propose a plan to minimize the identified side effects.

Source

C. H. Kepner, B. B. Tregoe (1980) – Rational Manager: Methods of problem analysis and decision making

C. H. Kepner, B. B. Tregoe (1981) – The new Rational Manager

J. Kosina (2004) – Quality improvement methods for identification and solving of large and complex problems

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