Decision Analysis

DECISION ANALYSIS

Definition: A systematic procedure based on thinking patterns used to make choices in the hopes that they are good ones. It involves considering the Elements of a good choice and weighing them against your MUSTS/WANTS and any risks before making a final decision: The book is full of mumbo jumbo on this, but it isn't rocket science. We do some decision analysis almost every time we take a course of action.

1.Develop a Goal or Decision Statement. ACTION Oriented statement. Will imply a decision is necessary. This is simply realizing that a decision/choice must be made and stating the need for a decision. - Provide focus -Identify Level (who? Commander, Resource Advisor, etc.). Be sure that this is concrete. "Fix the air conditioner" is not a good decision statement, it must be more specific.

2. Determine the Criteria OBJECTIVES (Musts and wants): Considering and defining the requirements/factors necessary to make a successful choice. These are the "requirements" and the "options". The "needs" and "wants". The "must have" and the "nice to have". MUSTS are required. WANTS are added extras. MUSTS are mandatory, measurable and specific. WANTS are subjective, not mandatory, desirable traits. Brainstorming. Make sure objectives are not LOADED; this will eliminate possible alternatives by narrowing the focus too much toward a single alternative. BRAINSTORMING

3.Compare alternatives to the criteria. Research to find comparable Alternatives. Matching alternatives against MUSTS will determine "Who can Play". Matching those finalists against WANTS will determine "who will win". This will ensure that decisions are based upon your defined criteria MUSTS and WANTS , priorities for each (weighted factors), and that your possible "courses of action" or alternatives were chosen properly. Involves research!!!

4. Conduct Risk Analysis. Consider the risks involved when making a final choice to ensure the safety and success of the choice. Determining possible or even rumored Pros and Cons. This sometimes results in a change to MUSTS and a reevaluation (starting over). Can also result in picking the number 2 Alternative.

The following mumbo-jumbo is from the text-book :

MAJOR ELEMENTS OF Decision Analysis

1.Develop a GOAL or decision Statement (Your charter, or the name of the decision): This provides the focus and sets limits/boundaries for the choice. The words used in the decision statement must be very clear in order to maintain the proper focus and LEVELof the choice you will make. EXAMPLE: The 12CS resource advisor's office will investigate no less than 15 automobile manufacturer's in order to purchase a vehicle to support the 12CS computer maintenance shop.

2.Objectives for the decision (what do you want to accomplish through this decision): Details which compliment the decision statement which provide a clear understanding of what needs to be accomplished through the decision. The objectives are divided into 2 categories: MUSTS and WANTS

MUSTS: Absolutely mandatory objectives. Without these objectives being met, the decision will be a failure. These MUSTS have to be concrete and measurable so that you can weed out any "possible alternatives or candidates" that cannot meet your objective. These are your required NEEDS. A potential candidate will either have this capability or not. It has to be clear.

WANTS: All other objectives that are not considered a MUST have. The wants will allow you to better evaluate possible candidates as they are compared to each other. These are "nice to have" additions. Wants can be tricky if they are restated MUSTS. WANTS that are restated MUSTS are usually ambiguous and non-measurable. These are things like "works and plays well with others". Many candidates may meet this criteria, but there may only be one clear-cut candidate that meets it BEST. In addition to the MUSTS and WANTS, the objectives also include constraints (limits). The result is a list of the appropriate Musts and Wants. EXAMPLE: MUSTS: American manufacturer, 7 passenger seating, front/side airbags, ABS, 7 CF cargo area. 3.0L engine, WANTS: Lowest possible cost, longest warranty, Air conditioning/heater, Radio/CD, cloth interior, full-size spare tire.

3. Alternatives (Candidates to choose from): These are the possible candidates that you evaluate using your MUST and WANT objectives as a guideline for comparison. There are ideal alternatives (a perfect fit that fulfills all your requirements without incurring risk) which are rare. Most of the time there will have to be a best balanced choice, which is the best choice of available candidates with the lowest risk factor.

4. Consequences of the Choice (associated risk): This involves searching for any risk involved with your best choice. We must thoroughly evaluate all possible "adverse consequences" (bad stuff) prior to making a final decision. If the risk analysis isn't done properly, and possible problems taken into account, the decision could prove to be bad. EXAMPLE: Buying a car with a 100,000 mile warranty only to have the company go out of business before your first warranty action.

TECHNIQUES of decision analysis

1.The decision Statement The decision statement is then broken down and acted upon based on the requirements stated.

2.Objectives for the decision; After creating this list of objectives NEEDS/WANTS at top, each NEED is considered crucial, so any alternative/candidate that cannot fulfill this NEED cannot be considered a viable competitor. This is called: Evaluation of Alternatives against MUST Objectives. During this stage, NEEDS are considered GO/ NO GO criteria. If a MUST criteria is not met, the Alternative (potential candidate) is considered a NO GO and removed from the list. Who ever is left after the GO/ NO GO test must then be compared based on WANTS and then RISKS.

WANTS must first be prioritized and listed by IMPORTANCE. These WANTS are then WEIGHTED based on their importance from 10 (most important), to 1 (least important). WANTS are not mandatory so the weight given to each can have a tremendous affect on the overall decision-making process. The priority and Importance level establishes "what matters most" in the list of the "nice to have" criteria. The higher the weight, the more crucial it is to your overall success. Too many high or low priorities can flaw the decision process so be careful. Be realistic and honest in weighing the wants.