lecture2 - The Decision-Making Process Part I ISQM 474 R....

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The Decision-Making Process Part I ISQM 474 R. Nakatsu
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Types of Decisions, Structuredness Structured Semistructured Unstructured
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Types of Decisions, Scope Operational (affects a particular activity, short-term) Tactical (mid-level scope) Strategic (affects a large portion of the organization, long-term)
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The Decision-Making Process Decision-making is a process of choosing among alternative courses of action for the purpose of attaining a goal or goals. Three steps (Simon, 1977): 1) intelligence ; 2) design ; 3) choice
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1. Intelligence Phase Search and scanning procedures Data collection Problem identification Problem ownership
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2. Design Phase Identify key variables Develop alternatives Predict and measure outcomes Formulate a model decision tables decision trees influence diagrams
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Identify Key Variables Decision Variables Uncontrollable Variables Outcome Variables Financial investment investment alternatives timing of investment
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lecture2 - The Decision-Making Process Part I ISQM 474 R....

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