Decision Making Flashcards
the process of identifying and choosing alternative courses of action in a manner of appropriate to the demands of the situation
Decision Making
8 Decision Making Process
- Diagnose a problem
- Analyze Environment
- Articulate problem or opportunity
- Develop viable alternatives
- Evaluate alternatives
- Make a choice
- Implement decision
- Evaluate and adapt decision results
2 Approach in Solving Problems
Qualitative Evaluation and Quantitative Evaluation
help organizations determine how much inventory to keep on hand to meet customer demand while minimizing holding costs and stockouts. Common methods include Economic Order Quantity (EOQ) and reorder point analysis.
Inventory Models
involves analyzing waiting lines or queues. It helps optimize processes where entities wait in line for service, such as customer service centers, call centers, or manufacturing operations.
Queuing Theory
are used for optimizing the flow of resources in complex systems. They include techniques like the Critical Path Method (CPM) and Program Evaluation and Review Technique (PERT), which are commonly used in project management.
Network Models
involves predicting future values of a variable based on historical data and trends. It is crucial for demand forecasting, financial planning, and capacity planning.
Forecasting
is used to establish relationships between variables. It helps in identifying the impact of one or more independent variables on a dependent variable. Linear regression is a common technique in this category.
Regression Analysis
involves creating models to imitate real-world processes and experimenting with them to understand how they function. It is particularly useful when making decisions about complex systems where analytical solutions are impractical.
Simulation
is an optimization technique used to find the best outcome in a mathematical model with linear relationships. It’s applied to problems where resources need to be allocated efficiently, such as in production planning and resource allocation.
Linear Programming
deals with the selection of a subset (sample) from a larger population for the purpose of drawing conclusions about the entire population. It is fundamental in statistical analysis, hypothesis testing, and market research.
Sampling Theory
involves using statistical methods to make decisions under uncertainty. It considers factors like risk and uncertainty to arrive at the most favorable course of action.
Statistical Decision Theory
This term refers to evaluation of alternatives using intuition and subjective judgement.
Qualitative Evaluation
This term refers to the evaluation of alternatives using any technique in a group classified as rational and analytical.
Quantitative Evaluation
