Handbook of Decision Analysis, 2nd Edition

Foreword to the 1st Edition

This handbook represents a significant advance for decision professionals. Written for practitioners by practitioners who respect the theoretical foundations of decision analysis, it provides a useful map of the tools and capabilities of effective practitioners. I anticipate that this and future editions will become the primary repository of the body of knowledge for practicing decision professionals.

This Handbook Is Timely

The practice of decision analysis (DA) is at a major inflection point. That high‐quality decisions can generate immense value is being demonstrated again and again. Leaders of organizations are increasingly aware of how opportunities are lost by making “satisficing” decisions – that is, decisions that are “good enough.” The benefit‐to‐cost ratio of investing in better decisions is frequently a thousand to one. I know of no better opportunity for value creation anywhere. As Frank Koch,¹ president of the Society of Decision Professionals (SDP), has said, “Benefit to cost ratios ... are immense simply because the added cost of doing DA is negligible. We would still be paying the analysts and decision makers without DA; they would simply be talking about different things. The incremental cost of having a better, more relevant conversation is zero, so regardless of the benefit, the ratio is infinite! Even if I throw in the cost of training and learning some software, that's measured in thousands and the benefits are clearly measured ...