Decision Analysis Introduction

Decision Analysis Introduction

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  DECISION ANALYSIS InS1 Business Prasetiya Mulya Business School
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  FOUR BASIC PATTERNSOF THINKING WHAT’S GOING ON? Enables us to impose order where all had been disorder, uncertainty, or confusion. WHY DID THIS HAPPEN? Enables us to move from observing the effect of a problem to understanding its cause so that we can take appropriate actions to correct the problem or lessen its effects WHICH COURSE OF ACTION SHOULD WE TAKE? Enables us to decide on the course of action most likely to accomplish a particular goal WHAT LIES AHEAD? We attempt to assess the problem that might happen , the decision that might be necessary in the future
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  The ability toask and answer the questions (‘ what’s going on’, ‘why’, ‘which’ and ‘what lies ahead’ ) made civilization possible By accumulating answers to these questions, humans learned how to deal with complexity, how to discover why things are as they are, how to make good choices, and how to anticipate the future
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  BASIC PATTERNS OFTHINKING IN THE ORGANIZATIONAL CONTEXT SITUATION APPRAISAL Assessing and clarifying situations, sorting things out, breaking down complex situations into manageable components, and maintaining control of events. PROBLEM ANALYSIS Based on the cause-and-effect thinking pattern, to identify, describe, analysis and resolve a situation in which something is going wrong without explanation. DECISION ANALYSIS Based on choice-making pattern of thinking. We can analyze the reason for making the decision and examine its purpose, analyze the available options and analyze the relative risks of each alternative. POTENTIAL PROBLEM ANALYSIS Based on our concern with future events. Based on the idea that thinking and acting beforehand to prevent a problem is more efficient than solving a problem that has been allowed to develop.
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  YOUR JOB RECOGNIZE SITUATION SEPERATE SET PRIORITY LOCATE PA OR DA OR PPA POTENTIAL PROBLEM ANALYSIS ENSURE SUCCESS OF ACTIVITY DECISION ANALYSIS CHOOSE A COURSE OF ACTIONS PROBLEM ANALYSIS EXPLAIN A DEVIATION
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  YOUR JOB SpecifyDeviation Statement PROBLEM ANALYSIS POTENTIAL PROBLEM ANALYSIS DECISION ANALYSIS Anticipate Likely Causes Anticipate Problems Action Plan Statement Compare & Choose Generate Alternatives Classify Objectives Establish Objectives Decision Statement Verify Test for Probable Cause Develop Possible Cause Provide for Information Select Action
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  CHARACTERISTICS OF THE3 APPROACHES TO MAKING DECISIONS ‘ THINKING FIRST’: science, planning, programming, the verbal ‘ SEEING FIRST’: art, visioning, imagining, the visual, ideas ‘ DOING FIRST’: craft, venturing, learning, the visceral, experiences (HENRY MINTZBERG & FRANCES WESTLEY)
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  IT WORKS BESTWHEN.. Henry Mintzberg & Frances Westley, 2001 Discipline can be applied Thoughts can be pinned down A few simple relationship rules can help people move forward Communication across boundaries is essential The context is structured Complicated specifications would get in the way Commitment to those solutions is key The data is reliable The situation is novel and confusing Many elements have to be combined into creative solutions The issue is clear DOING FIRST SEEING FIRST THINKING FIRST
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  … decisiontheory has now evolved from a somewhat abstract mathematical discipline which when applied was used to help individual decision-makers arrive at optimal decisions, to a framework for thinking that enables different perspectives on a problem to be brought together with the result that new intuitions and higher-level perspectives are generated Phillips L.D. (1989)
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  Decision analysis willnot solve a decision problem, nor is it intended to. Its purpose is to produce insight and promote creativity to help decision makers make better decisions. Keeney, R.L. (1982)